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Housing Benefit: Shared Accommodation Rate

Published Wednesday, November 26, 2014

The Shared Accommodation Rate (SAR) limits the amount of Housing Benefit that single person under the age of 35 can receive. This note provides background information on the operation of the SAR and its extension in January 2012 to claimants under age 35.

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The Shared Accommodation Rate (SAR, previously the Shared Room Rate) was introduced in 1996 and originally limited the Housing Benefit that a single person under the age of 25 could receive to the average rent level charged for a room in a shared house. The SAR has been controversial since its introduction.

As part of the October 2010 Spending Review the Government announced that the SAR would be extended to cover single claimants up to age 35 from April 2012. This change was brought forward to 1 January 2012 and was implemented by The Housing Benefit (Amendment) Regulations 2011 (SI 2011/1736).

Prior to implementation draft regulations, an Impact Assessment and an Equality Impact Assessment were published and referred to the Social Security Advisory Committee (SSAC) for consultation. The Impact Assessment stated that around 20% of the 1-bedroom Local Housing Allowance (LHA) caseload (at March 2010) would receive, on average, £41 per week less benefit than under the previous rules. The change was expected to affect around 63,000 people. The consultation exercise ended on 17 June 2011 and the SSAC’s report was published, with a Government response, in July 2011. The SSAC recommended that the proposals should not go ahead. The Government rejected the SSAC’s recommendations but included in the final regulations (Housing Benefit (Amendment) Regulations 2011 (SI 2011/1736)) two additional exemptions which only apply to the extended age group.

The Regulations were considered by the Merits of Statutory Instruments Committee in September 2011 and in Grand Committee (House of Lords) on 12 October 2011.

This note provides background to the SAR, some comment on its extension to under 35s and evidence of its impact to date.

Guidance on the implementation of the SAR extension and exemptions to it are contained in DWP Housing Benefit/Council Tax Benefit Circular A12/2011 (revised).

Commons Briefing papers SN05889

Author: Wendy Wilson

Topics: Housing, Housing benefits, Private rented housing

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