The growing government Housing Benefit bill is due to a shortage of social rented housing and increased subsidies for expensive private sector rents, new research from the Scottish Federation of Housing Associations (SFHA) has revealed.

The SFHA has called on the UK Government to stop stigmatising tenants in the social housing sector, and for both the UK and Scottish Governments to work together to maximise investing in new affordable homes for rent – the most cost-effective way to the public purse of meeting the huge need for affordable housing.

Evidence extracted from official government figures by the federation reveal that there is overwhelming evidence that expensive private rents are the cause of the growing volume and value of housing benefit claims.
Specifically, our research reveals:

UK-wide, in the past ten years the cost of Housing Benefit spent on private tenants has increased 153%, compared to a 21% increase for council and housing association tenants.

By 2011-12, 40% of the entire spend on housing benefit in 2011/12 went to tenants of private landlords, despite the fact that two-thirds of the entire caseload is made up of social tenants. Housing Benefit costs an average 70% more per week when used in the private sector than in council or housing association homes.

In Scotland, the last five years have seen housing benefit expenditure increase by 76% for private tenants, compared to just a 10% increase for tenants renting from councils or housing associations.

SFHA Chief Executive Mary Taylor said:

“Our research reveals that not only are social housing tenants being blamed, erroneously, for causing a huge increase in the housing benefit bill, but it also reveals that investing in more new build affordable housing is the most financially attractive option for the government to help provide the affordable housing that people so badly need.

“For many households, wages alone cannot support housing costs and that there is a persistent need for affordable housing.

“The SFHA therefore, is calling on the UK government to stop stigmatising social housing, and for both UK and Scottish Government to direct as much funding as they can to providing new build homes for rent, which achieves far better value for the public purse than subsidising expensive private sector rents. We call on the Scottish Government to take note of these figures as it sets its spending priorities for 2013-14.”