DWP announces it'll pay millions £785 each from April under new rates

The DWP has announced that Local Housing Allowance rates will change for 2024, taking effect from April 1.

The Department for Work and Pensions is to give millions of people £785 each from April in new benefit rates. The DWP has announced that Local Housing Allowance rates will change for 2024, taking effect from April 1.

This means that a total of 1.6 million households will benefit from an increase in LHA rates, according to the government. In April, the government will increase the Local Housing Allowance (LHA), the first time it has done so since April 2020 and amid record high rents.

LHA will be increased to cover the cheapest 30% of local market rents. This means anyone renting a home that is among the cheapest 30% of private rental properties in their area should be able to cover their entire rent with housing benefit.

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Work and Pensions Secretary Mel Stride said: "Housing costs are the number one expense for families. This £7 billion boost to Local Housing Allowance over the next five years, along with our landmark Back to Work reforms, reflects our fair approach to welfare – helping people into employment while protecting the most vulnerable with the unprecedented cost of living support."

Alex Clegg, economist at the Resolution Foundation, said: "The increase to LHA rates from April is very welcome news for low-income renters, who could see their housing support boosted by £80 per week for a three bed property.

"However, the way that LHA rates are calculated means that housing support will fall short of covering many households' rental costs, as rents have continued to rise since the new rates were announced back in September."

The government shared some numbers and explained: "Estimated number of households who will gain from an increase in LHA rates to the 30th percentile of local rents for 2024/25: 1,600,000. Estimated average annual gain for households who will gain from an increase in LHA rates to the 30th percentile of local rents for 2024/25: £785".