Housing benefit claimants in work double

National Housing Federation (NHF) research show that middle-income households earning between £20,000 and £30,000 a year accounted for two-thirds of all new housing benefit claims during the past six years.

The report, ‘Broken Market, Broken Dreams’, which used data from the Department for Work and Pensions and the English Housing Survey, showed the proportion of households having to claim housing benefit despite being in work has doubled to 22% since 2008. The federation predicts this figure could rise to one in three in the next five years. 

It suggested increasing housing costs were behind the rise in middle-income claimants and also highlighted the impact of years of only building half the number of homes needed, stagnant wages and more people renting privately due to a critical shortage of affordable homes. 

Between November 2008 and May 2014, there were 570,000 new households claiming housing benefit who were also in work, the equivalent of almost 300 households per day. That increase in working claimants accounted for more than three-quarters (79%) of new housing benefit claims made over that time.

David Orr, chief executive of the NHF, said: ‘Our shortage of affordable housing is now leaving families on a decent wage unable to cover the cost of their homes. This isn’t sustainable or right.  

‘In the 1970s, around 80% of government housing spend went on building homes with about 20% on housing benefits, but today it’s the other way round. Billions of pounds being spent on housing benefit is just a costly sticking plaster. What we need is a long-term solution to build the affordable homes we need, so that hard working families can support themselves.

‘Politicians need to address the problems of the housing market now, and commit to ending the housing crisis for a generation.’