Are you of working age and currently in receipt of housing benefit? If so, you may be affected by the under-occupation cap.
What is the under-occupation cap?
The government is introducing a cap on housing benefit for working age tenants who are under-occupying their home. From April 2013, you will have a reduction in your housing benefit if you have:
- One spare room - your housing benefit will be cut by 14% of the rent
- Two spare rooms - your housing benefit will be cut by 25% of the rent.
You will be considered as under-occupying if you have more bedrooms than you need. Under the new rules, one bedroom is allowed for each of the following:
- Every adult couple
- Any other adult aged 16 years or over
- Any two children of the same sex aged under 16 years old
- Any two children aged under 10 years old, regardless of sex
- Any other child aged under 16 years old
- A non-resident carer (the claimant or their partner has a disability and need overnight care).
If your housing benefit has been reduced, you may need to make up the difference from other income. If you do not pay your rent in full, you could lose your home.
How will I know if I will be affected?
Housing benefit entitlement letters will include details of any reduction and what your housing benefit entitlement is. We will also contact tenants that we know have been affected by the cap.
All tenants considering downsizing will be offered individual support on moving home, which will include registering them for a cash incentive, mutual exchange scheme (Homeswapper) and for Housing Moves, the pan London scheme. Your housing manager will help you to tackle any potential barriers to moving and help you find suitable properties to move to. We can also ‘match up’ under-occupying households with families which are in overcrowded accommodation. We also work closely with the cash incentive team at Housing Options and downsizing tenants will be given priority to move.
All tenants wishing to stay put will be offered budgeting advice so they can afford to stay, income maximisation advice and employment and training advice where relevant. We will also liaise with the benefits service to establish suitability for taking in a lodger.
If tenants are unable to move they will still be required to pay the shortfall in housing benefit, though some tenants may be eligible for a discretionary housing payment.
Which households will be exempt from the cap?
The cap only affects working age households. Working age claimants are normally aged over 18 years old and under pension age. Pension age claimants are people who have reached the qualifying age for State Pension Credit. The qualifying age is gradually increasing. To find out if you are eligible, please visit https://www.gov.uk/pension-credit/overview.
What choices are available?
If you are under-occupying you can:
- Move to a smaller property which matches your current household size
Make up the difference in rent from other benefits or income.
What can I do to avoid the under-occupation cap?
The best course of action to avoid the under-occupation cap is to move to a smaller property. If you do decide to move, we recommend you take action quickly, as you will still be required to pay the shortfall in rent until you move.
You can register with Homeswapper, a free service which enables you to make contact with other tenants wishing to move in the UK. You can register at www.homeswapper.co.uk or by contacting your estate office, where you can also find advice on the accommodation you can exchange to.
Cash incentive scheme
Westminster City Council also runs a cash incentive scheme where you can be given money to move to smaller accommodation. If you are eligible and under the state pension credit age, you can receive £1,000 for every bedroom given up, plus up to £2,000 towards removal and decorating costs. There is a limited amount of money available and it is on a first-come, first-served, basis. If you would like to find out more, please contact Steve Payne, cash incentive officer, Housing Options Service, on 020 7641 1000.
Housing Moves is the Mayor of London’s scheme to help social tenants in London relocate to other parts of the capital. All council tenants with a secure or assured tenancy can apply. Priority is given to tenants who:
- Are under-occupying and wish to downsize
- Are in work or training
- Wish to move in order to give care.
This choice based lettings scheme allows you to register and view details of all available properties on the Housing Moves website. You can then express an interest in the ones that suit you.
You can register for Housing Moves at http://www.housingmoves.org. CityWest Homes will need to check your application form before you can express an interest in properties.
How can I get help to manage a reduction in benefits?
If you are affected by the under-occupation cap and you choose not to move, or you are waiting to move, your income from benefits will reduce. Working out a household budget can help with managing your finances.
There is a useful online budget planner at https://www.moneyadviceservice.org.uk/en/tools/budget-planner.
We can also make an appointment for you to see a specialist adviser, who can give budgeting, debt and benefits advice. Please contact your estate office for an appointment.
How else can I increase my household income?
If you or a member of your family is out of work, we can arrange for you to see someone who will help with interview techniques, preparing CVs, access to jobs and job specific training. Contact your estate office to find out more.
What if I need a spare room for personal reasons?
If you think they need a spare room for personal reasons such as a disability or you are fostering, you may be eligible for a discretionary payment to cover the capped amount. The eligibility criteria for these payments is limited and there is no guarantee of a payment. Please contact your estate office for advice.