Housing benefit cuts could lead to debt troubles

Fri, 06 Jan 2012

Low income families could see their debt problems worsen as a result of the introduction of housing benefit cuts.

A study carried out by the Chartered Institute of Housing (CIH) for the Guardian revealed these households are likely to encounter shortfalls in their rent payments due to the new welfare reforms.

According to the research, people will therefore face the choice of debt, reducing living expenses or the prospect of homelessness if they cannot afford to keep up their rent payments.

Effective from January 1st 2012, these alterations mean a high number of properties are no longer fully covered by local housing allowance for private tenants, with 800,000 abodes throughout the UK becoming unreachable for families of a low income.

Grainia Long, interim chief executive of CIH - which is a not-for-profit group and registered charity - described the findings as astonishing, adding the reforms will result in the current market being unable to meet demand for homes .

The industry figure added: "The only feasible option for many families who want to stay in their communities will be to borrow more or to spend less on essential items such as food."
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