Scottish and Welsh governments call on Westminster to unfreeze LHA rates and scrap bedroom tax

Scottish and Welsh ministers have written a joint letter to the UK government urging it to unfreeze local housing allowance (LHA) rates and scrap the social housing bedroom tax as part of its approach to tackling poverty.

Sent ahead of the upcoming budget, the letter to the secretary of state for work and pensions Pat McFadden and education secretary Lucy Powell, asked Westminster to ensure LHA rates cover the lowest 30% of rents in an area “as an absolute minimum” - a move estimated to lift 75,000 children out of poverty by the end of UK parliament.

This is something the Scottish government has previously called for, while the Welsh government has asked for LHA to be restored to the 50th percentile over time, the same level as when LHA was first introduced in 2008 before it was cut to 30% in 2011.

LHA rates are used to calculate the amount of financial support towards private sector housing a tenant can receive if they claim universal credit.

Shirley-Anne Somerville, Scottish social justice and housing secretary and Sioned Williams, deputy first minister of Wales, also called on Whitehall to remove the bedroom tax, which reduces the amount of housing benefit a social tenant can receive if they are deemed to have more bedrooms than they need.

“While each of our governments is taking action within devolved responsibilities, many of the most powerful levers for tackling poverty remain reserved to the UK Government. The forthcoming Budget therefore presents an important opportunity to deliver meaningful improvements for children and families across the United Kingdom,” the ministers wrote.

They also called for targeted bill discounts to offset rising utility bills, particularly for those being “disproportionately impacted” by the war in the Middle East. The letter acknowledged a “considerable number” of off-gas grid properties in rural and coastal communities in both countries, while one in four Welsh households are living in fuel poverty with a further 16% at risk.

If approved, 660,000 households in Scotland would see their estimated fuel bills go down by an average of £700, said the letter.

The Scottish and Welsh governments signed the Cardiff Agreement last month, pledging to work together on areas including tackling child poverty and the cost of living.