benefit is to be reformed.
For the first time funding for social and private tenants' housing
Pensions - as part of a wholesale reform aimed at making the process
The changes, which take place from April 2004, will be as follows:
- Subsidy will be paid at the rate of 100 per cent for all housing
and council tax benefits correctly paid by local authorities in
England, Wales and Scotland.
- The subsidy rate for properly backdated claims will increase from
50 per cent to 100 per cent.
- Councils will be subsidised for incorrect local authority
overpayments in a performance-related way, linked to an authority's
achievements against thresholds set by DWP.
- Local authorities will be paid a contribution towards the cost of
discretionary local schemes for war pensions disregards.
- A transitional protection scheme will apply, designed to cushion
the impact on local authorities of implementing the subsidy reform
- DWP aims to produce a new claim form combining subsidy claims for
housing benefit for social and private tenants and council tax
Housing benefit minister Chris Pond said: 'These reforms will mean a
simpler, more transparent system for local authorities and address
some of the problems of the past. Rationalising the subsidy system is
also an important part of our housing benefit reforms.
'I am particularly pleased that we will be able to make a
contribution towards the cost of local disregards for war pensions,
paying tribute to those who have served their country.'
Some elements of the subsidy system remain unchanged, including the
subsidy rates for claimant error, fraud and other overpayments.
1. The Local Government Act 2003 provides for Rent Rebates for so cial
tenants to be taken out of the Housing Revenue Account (HRA). As a
result, ministers have agreed to transfer responsibility for payment
of Rent Rebate subsidy from the ODPM and National Assembly for Wales to DWP from 2004/05.
2. Since DWP is already responsible for Rent Allowance and Council
Tax Benefit subsidy and Rent Rebate subsidy in Scotland, ministers
also agreed that the 5.5 per cent residual RA/CTB subsidy currently
paid to authorities through the Revenue Support Grant /Grant Aided
Expenditure in Scotland should transfer from ODPM, the Welsh Assembly
Government and Scottish Executive (SE) to DWP. All subsidy funding is
therefore now under the control of DWP from 2004/05.