A maintained freeze on local housing allowance (LHA) rates could push 60,000 Londoners into homelessness over the next six years, according to new analysis.
Research from Alma Economics, commissioned by London Councils, found that between 16,500 and 22,000 London households in the private renting sector are likely to become homeless by 2030 unless LHA is raised.
London Councils calculated that this equated to 58,740 people becoming homeless, including 28,000 children.
The cross-party group said one in seven private renters in the capital are reliant on LHA, which eligible households receive as part of their housing benefit or Universal Credit.
LHA has been frozen for three years. The research found that restoring LHA to cover at least 30% of local market rents would save public finances in London more than £100m a year, particularly through reduced pressure on homelessness services but also decreased spending on the NHS and social care.
London Councils said ending the freeze on LHA was one of its top priorities in its submission to the Government ahead of the Autumn Statement.
London Councils’ executive member for regeneration, housing and planning, Darren Rodwell, said: ‘London is the epicentre of the national homelessness crisis.
‘The situation is increasingly unmanageable and requires urgent government action. We cannot continue in this disastrous direction.
‘Just as the Government boosted LHA during the Covid-19 pandemic to prevent a wave of mass homelessness, we need a similar emergency response to the situation today.’
