More than three-fifths of private tenants on Universal Credit face shortfall

Analysis of official Government data revealed 35,878 people in the area receiving a housing element to the benefit with 22,834 left facing a shortfall.

And they are facing a shortfall of a mean average of £101 per month due to a combination of rising rents and the freeze to the Local Housing Allowance (LHA).

The National Residential Landlords Association (NRLA) has urged the Government to scrap the freeze to rates, introduced during the pandemic in April 2020.

It is used to calculate the maximum amount people renting from a private landlord can claim in housing benefit or a Universal Credit payment, the Government says.

The increase was introduced to cover the bottom 30 per cent of private rents in any area. It was frozen in cash terms in April last year until 2022/2023 by ministers.

But the NRLA has warned the freeze – initially welcomed amid the pandemic – could have a negative effect with people having to find the money for rent elsewhere.

The Government data, up to November last year, shows there were 7,766 private rented households in Wolverhampton who were in receipt of Universal Credit with a housing cost support element to it, with 4,862 facing an average monthly shortfall of £90.

In Dudley, it was 6,175 households with 4,190 facing a shortfall of £97. In Walsall, it was 6,551 with 4,096 facing a shortfall of £88. In Sandwell, it was 8,858 with 5,664 facing a shortfall of £100.

Elsewhere, in Stafford, it was 1,680 households with 1,089 facing the shortfall of £100. In Cannock Chase, it was 1,852 with 1,040 facing a shortfall of £95. In South Staffordshire, it was 1,060 households with 783 facing a shortfall of £140. And in Wyre Forest, it was 1,936 households with 1,110 facing a shortfall of £99.

Further afield, in Shropshire, there were 4,484 households with 3,118 facing a shortfall of £100. And in Telford and Wrekin, it was 5,404 households with 3,289 facing a shortfall of £75.

Don Robbie, West Midlands spokesman for the NRLA, said: "The benefits system fails to provide renters and landlords across the West Midlands with the security they need.

"It cannot be right that housing benefit support fails to reflect the reality of current rent levels. The freeze merely exacerbates the already serious cost of living crisis for tenants across the region.

"The Chancellor needs to listen and respond to the concerns of both renters and landlords by unfreezing housing benefits as a matter of urgency."

The Office of Budget Responsibility said the freeze meant the original £1 billion cost of the policy in 2020/2021 would decline to £300 million by 2025/2026 – and LHA rates would fall back below the 30 per cent of cheapest local rents over time – making it harder on private renters.