Angela Rayner accuses landlords of profiting from local housing allowance

Angela Rayner has rejected calls to unfreeze the local housing allowance (LHA) arguing that increasing LHA rates would simply funnel more money to landlords.

In a Housing, Communities and Local Government Committee (HCLG) session on the spending review, Housing Secretary Angela Rayner rejected calls to unfreeze the Local Housing Allowance, emphasising that the solution was to “not give money to private landlords” and focus instead on building more homes.

Ms Rayner also accused landlords of evicting families without excuse, then hiking rents and putting someone else in their place.

Not give money to private landlords

Florence Eshalomi, chair of the HCLG, questioned Ms Rayner over the government’s stance on the Local Housing Allowance and said the freeze was pushing families into poverty. She asked whether a case was being made to review the allowance.

The Conservative government announced an end to the four-year freeze to LHA rates in 2023; however, the Labour government froze the LHA rates again during the Budget last year.

Ms Rayner swerved Ms Eshalomi’s question and claimed the government is working to alleviate the pressures on homelessness, adding that it is spending £34 billion per year on housing support, including £12 billion in the private rented sector.

However, Ms Rayner blamed landlords for benefiting from Local Housing Allowance payments.

She told the committee: “In the longer term, the only way we are going to fix this crisis is not by giving more money to private landlords for people who should be in social housing; we need to have a social housing revolution.

“That is why I have been so bold as to push for the biggest increase in the Affordable Homes Programme, alongside the rent convergence.”

Landlords evict families with no excuse

Ms Eshalomi then fired back at Ms Rayner and asked: “Whether the local housing allowance freeze is a political choice by the government to push children into poverty.”

Ms Rayner again talked about the government’s funding commitment to housing support, but then repeated that private landlords were to blame.

She said: “We are investing by putting money into local housing allowance, but the truth is that the way to fix the problem is not by having significant rent increases under private landlords who put social tenants in private accommodation.

“The way to fix the problem is to have more social housing for people who desperately need it.”

NRLA warning on LHA

Ms Eshalomi pointed out that even the National Residential Landlords Association (NRLA) has spoken of the impact of the local housing allowance. The NRLA has extensively campaigned to restore the Local Housing Allowance (LHA) rates to the 30th percentile of local market rents.

Ms Rayner argued the government was building 1.5 million homes to tackle the crisis, but Ms Eshalomi said: “We can’t build homes fast enough. In the interim, they are renting in the private rented sector, but a lot of them are not able to rent locally because of the freeze on the local housing allowance.”

Ms Rayner again did not answer the question and, once again, blamed landlords, saying: “Again, on top of that, we have the Renters’ Rights Bill, with its protections, and the extra money we set aside for homelessness prevention.

“Local councils can look at some of that for ways to prevent homelessness and at section 21 no-fault evictions, along with other challenges that families face that lead them into homelessness in the first place.

“We have seen landlords evict families, with no excuse, and then ramp up the rent and put somebody in. That is because the housing market is in such a dire situation. We have taken measures to try to prevent some of those egregious practices, as the same time as building the homes that we need.”

Despite Ms Rayner’s claim landlords evict for no reason, the English Housing Survey Private Rented Sector report for 2021-2022 reveals that the majority of renters (77%) ended their last tenancy because they wanted to move, not because of eviction.

Watch a clip of Angela Rayner from the committee below