Exempt accommodation is defined in subparagraph (10) of paragraph 4 of Schedule 3 to the Housing Benefit and Council Tax Benefit (Consequential Provisions) Regulations 2006 (SI 2006/217) as follows:
- “Exempt accommodation” means accommodation which is -
- a resettlement place provided by persons to whom the Secretary of State has given assistance by way of grant pursuant to section 30 of the Jobseekers Act 1995 (grants for resettlement places); and for this purpose, “resettlement place” shall have the same meaning as it has in that section; or
- provided by a non-metropolitan county council in England within the meaning of section 1 of the Local Government Act 1972, a housing association, a registered charity or voluntary organisation where that body or a person acting on its behalf also provides the claimant with care, support or supervision.
Local Reference Rent
The average rent for property of a suitable size for the Housing Benefit claimant, carried out by the Independent Rent Officer. The LRR provides a limit on the amount of Housing Benefit that can be paid - the claimant can only receive the lesser of the LRR and the Claim Related Rent.
An LRR is only set for the following types of accommodation:
- Conventional private tenancies where the claimant has been getting HB for the same home since 2008
- Unconventional privately rented accommodation (including accommodation in the voluntary and charitable sectors):
- Accommodation where the rent includes a substantial amount for meals prepared and served (“board and attendance”)
- Rarely, a registered housing association tenancy where the local authority considers that the rent charged for the dwelling is unreasonably high
Local Housing Allowance
Local Housing Allowance is used to determine the Maximum Rent (LHA) for private tenants in conventional accommodation whose HB award began since April 2008. Maximum Rent (LHA) is the maximum amount that can be covered by Housing Benefit and its is defined in Regulation 13D of the Housing Benefit Regulations 2006:
Determination of a maximum rent (LHA)
13D. (1) Subject to paragraph (3) to (11), the maximum rent (LHA) shall be the local housing allowance determined by the rent officer by virtue of article 4B(2A)(c) or (4) of the Rent Officers Order which is applicable to –
- the broad rental market area in which the dwelling to which the claim or award of housing benefit relates is situated at the relevant date; and
- the category of dwelling which applies at the relevant date in accordance with paragraph (2).
In November 2015, the government announced that any new tenancy in the regulated social sector (registered housing associations and local authorities) entered into from 1 April 2016 will be subject to the LHA.
Maximum Rent (Social Sector)
The Maximum Rent (Social Sector) is more commonly known as the “bedroom tax” and is referred to ministers and DWP officials as the “removal of spare room subsidy”. The MR(SS) is determined under Regulation B13 of the Housing Benefit Regulations 2006.
B13. (1) The maximum rent (social sector) is determined in accordance with paragraphs (2) to (4).
The relevant authority must determine a limited rent by–
- determining the amount that the claimant’s eligible rent would be in accordance with regulation 12B(2) without applying regulation 12B(4) and (6);
- where the number of bedrooms in the dwelling exceeds the number of bedrooms to which the claimant is entitled in accordance with paragraph (5) to (7), reducing that amount by the appropriate percentage set out in paragraph (3); and
- where more than one person is liable to make payments in respect of the dwelling, apportioning the amount determined in accordance with subparagraphs (a) and (b) between each such person having regard to all the circumstances in particular, the number of such persons and the proportion of rent paid by each person.
The appropriate percentage is –
- 14% where the number of bedrooms in the dwelling exceeds by one the number of bedrooms to which the claimant is entitled; and
- 25% where the number of bedrooms in the dwelling exceeds by two or more the number of bedrooms to which the claimant is entitled.
Where it appears to the relevant authority that in the particular circumstances of any case the limited rent is greater than it is reasonable to meet by way of housing benefit, the maximum rent (social sector) shall be such lesser sum as appears to that authority to be an appropriate rent in that particular case.
The claimant is entitled to one bedroom for each of the following categories of person whom the relevant authority is satisfied occupies the claimant’s dwelling as their home (and each person shall come within the first category only which is applicable –
- a couple (within the meaning of Part 7 of the Act);
- a person who is not a child.
- a child who cannot share a bedroom.
- two children of the same sex.
- two children who are less than 10 years old.
- a child,
The claimant is entitled to one additional bedroom in any case where –
- a relevant person is a person who requires overnight care; or
- a relevant person is a qualifying parent or carer.
- more than one sub-paragraph of paragraph (6) applies the claimant is entitled to an additional bedroom for each sub-paragraph that applies;
- more than one person falls within a sub-paragraph of paragraph (6) the claimant is entitled to an additional bedroom for each person falling within that sub-paragraph, except that where a person and that person’s partner both fall within the same sub-paragraph the claimant is entitled to only one additional bedroom in respect of that person and that person’s partner.
For the purposes of determining the number of occupiers of the dwelling under paragraph (5), the relevant authority must include any member of the armed forces away on operations who –
- is the son, daughter, step-son or step-daughter of the claimant or the claimant’s partner;
- was the claimant’s non-dependant before they became a member of the armed forces away on operations; and
- intends to resume occupying the dwelling as their home when they cease to be a member of the armed forces away on operations.
In this regulation “relevant person” means –
- the claimant.
- the claimant’s partner.
- a person (“P”) other than the claimant or the claimant’s partner who is jointly liable with the claimant or the claimant’s partner (or both) to make payments in respect of the dwelling occupied as the claimant’s home.
- P’s partner
“Care” (as distinct from “support” or “supervision”) includes:
- Helping a physically disabled person to get out of bed, wash, dress, use a toilet or eat meals.
- Guiding and assisting a person with a learning disability as they go about tasks that would be relatively simple for a person without such a disability: buying food, preparing food etc
- Carrying out tasks on behalf of a disabled person because they do not have the physical or mental capacity to do those things at all, not even with supervision: dealing with correspondence, arranging appointments etc
Support in the context of supported accommodation and housing benefit is a broad term that can apply to many activities which, in different ways, help people to overcome difficulties that might otherwise prevent them from living in their accommodation. Examples include:
- Drug or alcohol counselling
- Help dealing with correspondence and benefit claims.
- Budgeting on a low income
- Repairs and maintenance over and above what a landlord would normally expect to do
There are good reasons why exempt accommodation is exempt from benefit limits.
Charitable or voluntary sector tenants
Both the Local Reference Rent and the Local Housing Allowance represent average market rents for various different property sizes. The figures take no account of any special requirements or extra running costs associated with the Housing Benefit/Universal Credit claimant’s need for care, support or supervision. Because the landlord has to cover these costs for the tenancy to remain viable, exempt accommodation status allows the local authority to pay a higher rate of benefit. Examples of special requirements and higher running costs include the following:
- If a tenant has physical disabilities it might be necessary to adapt the accommodation, for example by installing a wetroom or through-lift, or widening doorways to ensure adequate manoeuvring space for a wheelchair
- The accommodation might need to be in a certain location:
- Secluded so that tenants who exhibit challenging behaviour do not disturb their neighbours
- Away from busy roads or noisy playgrounds if tenants are very sensitive to noise
- Easily accessible by wheelchair - not just internally but on the approach to the dwelling
- The property might need expensive fixtures and fittings and equipment:
- Adjustable hospital-style beds
- Cooking and heating appliances that are safe to be used by people with learning disabilities, such as instant cooling hobs
- Higher repair and maintenance costs associated with:
- Accidental damage caused by tenants with learning disabilities.
- More rapid wear and tear of furniture caused by prolonged incorrect use (again associated with learning disabilities)
- Replacing items stolen by tenants which is a more likely occurrence when providing accommodation to certain client groups.
Registered housing association tenants
A key policy intention behind the Maximum Rent (Social Sector), or “bedroom tax”, is to encourage tenants with spare bedrooms to consider moving to smaller accommodation. But the government recognises that there are likely to be good reasons why a person living in exempt accommodation might have an extra bedroom, including:
- Overnight visits from relatives who might have travelled a long way to visit the tenant.
- Storage space for medical supplies or disability-related equipment
In addition the options that are available to general needs tenants faced with the Maximum Rent (Social Sector) might be unavailable or unsuitable in exempt accommodation:
- Finding employment
- Taking in a lodger
The benefit cap can affect working age tenants in any rental market sector: private, voluntary sector or registered housing association. The policy intentions behind the benefit cap include incentivising people to seek work and encouraging people with expensive accommodation to move to a cheaper area. But for the reasons listed above neither of these options may be realistic in exempt accommodation and for good reasons the accommodation may well be more expensive than a general needs tenancy. Exempt accommodation is protected from the benefit cap by excluding Housing Benefit from the benefits that count towards the cap. This means that claimants living in exempt accommodation will very rarely be capped.