A group of charities have urged the Prime Minister to reverse the decision to freeze Local Housing Allowance (LHA) rates.

In an open letter written by 19 leading poverty, housing, and homelessness charities, the organisations highlight their ‘deep concern’ over the Chancellor’s decision to freeze LHA rates for the third year running in last week’s Budget.

The letter, signed by groups including the Joseph Rowntree Foundation, Shelter, and Trussell, warns that current LHA rates do not reflect the 23% rise in private rent levels since September 2023, meaning that the disparity between rents and the support available is ‘at a record high’.

It argues that the ‘widening shortfalls’ are giving private renters no option but to use money allocated for bills to cover rent costs, leaving 78% of those receiving housing support without essentials, and placing a further 56% in arrears with household bills.

‘For many people, this reality becomes untenable and they can no longer afford to stay living in their homes, and councils are left to pick up the pieces’, the letter reads.

It adds: ‘Uprating LHA in 2027/28 would have cost £1.7bn. That cost has been passed directly on to low-income renters and will drive-up poverty, destitution and homelessness, increase spend on temporary accommodation and critically undermine your commitment to end rough sleeping.’

As part of their call to action, the groups have urged the Prime Minister to reverse the decision, as well as asking that LHA rates are restored to the 30^th percentile of local rents.

They also call for the rollout of an inflation-linked rent cap that would address a ‘key underlying driver of the housing benefit bill – high and rising rents’.

‘You have been clear that tackling homelessness is a top priority. These two steps would bring your vision within reach by tackling the cost of rent and ensuring that housing support for those who need it actually covers the cost of a home’, the letter states.

The Government has been contacted for comment.