§ Mr. Kidney
To ask the Secretary of State for Work and Pensions pursuant to his written statement of 1 December 2003,Official Report, column 49WS, on housing benefit subsidy reform, how the new subsidy system for housing benefit and council tax benefit will he implemented, with particular reference to transitional relief; and what the arrangements will be for payment of the administration grant.416W
§ Mr. Pond
The new subsidy system will be introduced on 1 April 2004 to all local authorities in England, Wales and Scotland. All claims relating to the 2004–05 subsidy year will be made under the new rates and rules. We issued a subsidy Circular (S9/2003) to authorities on 1 December to explain all the detailed changes; a copy of this circular is available in the Library.
Although the overall levels of funding under the new system will be cost neutral compared to the old system, we recognise that individual authorities may gain or lose under the new arrangements. A transitional protection scheme has therefore been put in place. At the end of 2004–05 subsidy claims from each local authority will be compared with the amounts of subsidy they would have received had they claimed under the subsidy rules in place in 2003–04. The scheme will ensure that in the first year no authority will lose more than 1 per cent. of the funding which they would have received had the rates not changed.
Details of individual allocations to authorities of administration grant for 2004–05 will be issued in a circular by the end of the month. The administration grant will be paid to authorities in 12 monthly instalments from April 2004.