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Housing benefit cap reform delayed

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Iain Duncan Smith said the housing benefit cap will be delayed until January 2012 for existing claimants

A new cap on housing benefit is to be delayed by nine months to give those affected more time to negotiate a cheaper rent or find a new home.

The announcement of the £400-a-week limit on housing benefit sparked outcry earlier this year, with some MPs warning of an exodus of poorer families from expensive areas of London and other cities. London Mayor Boris Johnson warned he would not accept the “Kosovo-style social cleansing” of the capital.

Work and Pensions Secretary Iain Duncan Smith has now announced that the implementation of the cap, due in April 2011, will be delayed until January 2012 for existing claimants.

To offset the cost of the change, a cut in housing benefit rates for new claimants will be brought forward from October to April next year. New claimants will also be subject to the cap from April 2011.

Regulations laid before Parliament will limit housing benefit payments to £250 a week for a one-bedroom home, £290 for a two-bed property, £340 for a three-bed house and £400 for four beds or more.

Reforms introduced by Mr Duncan Smith are intended to slice £2 billion off the £21 billion annual budget for housing benefit by 2014/15.

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