Croydon residents are increasingly struggling to meet the cost of rent as government figures reveal a sharp increase in the number of people claiming housing benefit.
Statistics released by the Department for Work and Pensions (DWP) show a rise of 20.7 per cent more recipients of Local Housing Allowance, more commonly known as housing benefit, in the period from June 2010 to May 2011. This places Croydon in the top fifth of local authorities in the UK noting a growth in payments.
The other three boroughs along the East London Line also recorded an increase.
There were hikes in Hackney by 15.4 per cent, Tower Hamlets by 12.5 per cent and Lewisham by 10 per cent respectively.
As a result there are now 12,220 people in Croydon receiving help towards the cost of rent. Numbers stand at 10,640 in Lewisham, 8,510 in Hackney and 4,820 in Tower Hamlets respectively.
The figures suggest that increasing numbers of households in the area are likely to be hit by government plans to slash housing benefit rates from January, as rent levels continue to soar across the capital.
Jad Adams, from Croydon Nightwatch, a charity that helps homeless people, said: “Things are getting more difficult; those already hard-up before the recession are even worse off now.
“We already see many people evicted, so if housing benefit is reduced this will mean more due to arrears. For many people locally it already doesn’t cover all of the cost of rent.”
From January next year only the bottom 30 per cent of the local rental market will be covered by housing benefit for new claimants. The benefit is currently calculated to include the bottom half of properties types in an area. Furthermore people aged up to 34 will only be able to claim single room rate – pushing many properties out of reach of the unemployed and low-income families.
An officer from a well-known south London housing charity who did not wish to be named told East London Lines: “People on benefit will have to work out with their landlords whether they will accept a reduced rent. This will be a business decision for landlords, which is not helpful for tenants.
“Nobody in the housing sector thinks that the changes are good for people at risk of homelessness, private landlords or housing providers.”
In a recent report by housing charity Shelter, Hackney and Tower Hamlets were found to be among the top ten most unaffordable places to live in the country, with ‘affordable’ defined as accommodation where rent does not exceed 35 per cent of household income. Overall across London average rents increased by 12 per cent in the year to June – high above inflation which is currently around the 5 per cent mark.
A parliamentary question tabled in June this year by Baroness King of Bow revealed that around 970 people claiming housing benefit in Tower Hamlets “will experience a loss” as a result of the cap and removal of the rate for five-bedroom properties.