§ The Secretary of State for Work and Pensions (Mr. Andrew Smith)In October 2002, I announced a wide ranging programme of Housing Benefit reforms aimed at giving tenants choice and promoting personal responsibility. The centrepiece of those reforms is the Local Housing Allowance—a set amount allowance for housing costs based simply on household composition and location, and reflecting market rents.
We are testing this new scheme, for tenants renting accommodation in the private sector, in nine pathfinder local authorities, representing different types of housing markets, before rolling it out nationally. When we launched the policy I promised to keep colleagues updated on progress and I know there has been interest from many hon. Members in these groundbreaking reforms. I am pleased to report as of 9 February all pathfinders are up and running and implementation has gone smoothly.
Already some 19,000 tenants are enjoying the benefits of Local Housing Allowance in the Pathfinder areas, and a further 25,000 will transfer over the coming months.
For tenants in the private rented sector the local housing allowance means, for the first time, they will know in advance how much they will receive towards housing costs. This greater certainty about the amount of benefit that will be paid will help people make the move from benefits to work. Tenants will be able to choose where to live and whether to spend all, less or more than this on rent, out of their total income. These are the same choices that we all make.
103WSIt follows that to have this freedom of choice, and to exercise this personal responsibility payments of local housing allowance are normally made to the tenant rather than the landlord.
we recognise that some tenants, who have not been used to having those choices and responsibilities, will need help and support. We also recognise that it is important to provide safeguards for landlords against tenants who default on their rent. We are providing a range of safeguards for landlords, and support and advice for tenants.
It is too early to provide any firm analysis but I am pleased to report that there are already signs of tenants exercising choice by negotiating rent, and moving to accommodation that is more appropriate to their needs, and that landlords are working with pathfinders and claims are being processed more quickly.
We will continue to closely monitor and evaluate the pathfinder stage before extending the benefits of the Local Housing Allowance nationally.