Discretionary Housing Payments (DHP) policy

Introduction

DHP funding can help people with housing costs, including those affected by:

  • the benefit cap
  • removal of the spare room subsidy in the social rented sector
  • Local Housing Allowance (LHA) rates

You may be awarded DHP to cover the following costs:

  • a rent shortfall (the difference between your Housing Benefit/UC Housing Costs and your rent charge)
  • rent deposits
  • rent in advance if you need to move home

This DHP Policy should not be seen in isolation. It is part of a broad range of services available as part of a developing integrated local welfare assistance provision. Its aim is to protect the vulnerable but at the same time be realistic about the financial means available.

The DHP Policy

The Council aim to use the full allocation of DHP funding provided by Government to support vulnerable tenants with their housing costs and help them secure or maintain stable and affordable housing solutions.

In most cases, DHP will be used for short term needs giving tenants time to take the appropriate actions to change their personal situation. There will be exceptions where longer-term support may be valid due to individual circumstances and for economic reasons. Examples of instances where longer term support would be considered are:

  • people with a disability who have had substantial adaptations to their home
  • foster carers affected by the size criteria in the social rented sector and
  • housing that offers a stable tenancy and affordable rent

The council experiences large demand for DHP however, due to the limited DHP funding available, it is not possible to help everyone who applies.

Applications for DHP are normally subject to an income and expenditure review. DHP will not normally be considered where:

  • suitable alternative more affordable housing is an option. This will include accommodation in the private rented sector. The issue of whether the accommodation is suitable will consider whether it is reasonable to expect the tenant to move having regard to the impacts on health and schooling where children are present
  • alternative income sources are available. This will include unclaimed benefits and tax credits, income from other adults living in the household and savings over an agreed level
  • alternative and more relevant options exist. This includes tenants facing shortfalls because of sanctions applied by Jobcentre Plus, tenants with disproportionate expenditure on debts and loans where debt restructuring provides a realistic alternative and tenants with disproportionate expenditure on non-essential items

Support for tenants subject to the Benefit Cap

Households impacted by the Benefit Cap may be prioritised for support where:

  • financial support is required to facilitate a move to more affordable accommodation
  • the shortfall in rent is too great to cover from other household income
  • alternative more affordable accommodation is not appropriate
  • a lower rent cannot be negotiated
  • there is a real risk of the family becoming homeless
  • there are lone parents with children under 2 years old
  • older people approaching pension age where work is not a realistic option
  • support for tenants subject to the Removal of the Spare Room Subsidy (RSRS)

In the longer term, tenants will be expected to try and improve their situation. For example, by increasing their income or moving to more affordable accommodation.

Support for tenants subject to the removal of the spare room subsidy (RSRS) in the social rented sector

Priority will be given to tenants living in homes where the home has been adapted for disability and foster carers who will not be allowed an extra room for a foster child under the benefit rules.

It will not be possible to protect all tenants impacted by the Spare Room Subsidy within the Government's funding contribution, and the criteria set out in this policy will be used to determine eligibility for DHP support, targeting the following:

  • tenants where a member of the household is disabled, and the property has undergone significant adaptation because of the disability
  • foster carers and supported Kinship Care arrangements
  • parents requiring an additional room under child access arrangements where alternative housing options, including options in the private sector, are not appropriate
  • older people approaching pension age where work is not a realistic option
  • families expecting a first child where housing allocation has been made on this basis
  • any other bedrooms used for overnight care
  • adults unable to share and who are not in receipt of a qualifying benefit for an extra room

Support for tenants subject to Local Housing Allowance restrictions

The Local Housing Allowance (LHA) affects tenants in the private-rented sector and have been in force since April 2011. However, for tenants already getting benefit at the time the changes came in received transitional protection for a while. The impact of the LHA rates depends on:

  • whether rents are reduced to reflect the new LHA rates
  • the levels at which LHA are set by the VOA

In the first instance, landlords should be encouraged to reduce rents in exchange for direct payments of HB. Where this is not appropriate, DHP support will be targeted to those private sector tenants where:

  • it is unlikely there would be alternative more affordable accommodation
  • the tenant is subject to the Shared Accommodation Rate but requires an additional room under child access arrangements
  • there are exceptional circumstances that mean it is not appropriate for the tenant to move to more affordable accommodation

DHP will not normally be made to tenants entering a new tenancy. LHA rates are made public, and most landlords are aware of the rates for the types of accommodation they provide. An exception to this will be where a tenant has had to move quickly, perhaps because they are fleeing domestic violence or there is another compelling reason.

Support not related to LHA changes, Benefit Cap or RSRS

The DHP scheme has been in operation since 2001 to provide additional help to tenants facing a shortfall in their housing costs. The scheme has tended to focus on tenants facing exceptional hardship such as debt, unavoidable additional short-term expenditure or high housing costs caused by the need to live in a particular area.

Typically, this support went to private rented sector tenants. This is because tenants are required to have a shortfall in their rent support and far fewer social sector tenants had a shortfall in their rent. The changes brought about by the Benefit Cap and Social Sector Size Criteria mean that more social sector tenants have a shortfall in their rent support. This in turn means more applications for support.

It is intended to continue with the policy of targeting this support to tenants facing exceptional hardship such as debt, additional short-term expenditure or other exceptional circumstance that requires short-term support.

Administration

The Discretionary Housing Payment Scheme is administered by the Welfare and Benefits Service. DHP claims can be made online.

Decisions will normally be made within 10 working days of us getting the required information.

It is not intended to allocate DHP budgets for each category of expenditure. Instead, a single DHP budget will apply with expenditure monitored in relation to:

  • total spend
  • spend by reason (Benefit Cap, Size Criteria, LHA, other)
  • spend by tenure type
  • spend by tenants' circumstances (for example, disabled, foster care and UC)

Disputes on DHP decisions will be dealt with through local arrangements and will involve an officer led review.

What DHP cannot cover

DHP cannot be awarded to cover the following costs:

Legislation precludes the following elements of rent, and shortfalls in HB or UC, from being met by a DHP.

Ineligible charges: service charges which are ineligible for HB cannot be covered by a DHP. These are as specified in Schedule 1 to the Housing Benefit Regulations and Schedule 1 to the Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations. Nor can a DHP cover charges for water, sewerage, and environmental services – as defined and calculated under the HB provisions. The service charge rules for UC can be found in the UC Regulations 2013, Schedule 1.

Increases in rent due to outstanding rent arrears: under Regulation 11(3) of the Housing Benefit Regulations and Regulation 11(2) of the Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations, where a claimant's rent is increased on account of outstanding arrears owed by the claimant in respect of their current or former property, the shortfall cannot be covered by a DHP.

Sanctions and reductions in benefit: DHPs cannot meet these because to do so would undermine the effectiveness of the sanctions or reduction in benefit. These are any:

  • reduction in Income Support (IS) or income-based Jobseeker's Allowance (JSA(IB)) due to a Reduced Benefit Direction (RBD) (reduction in benefit of 40 percent of the personal allowance that applies only to IB or JSA(IB)) for failure to comply with the Child Support Agency in arranging maintenance
  • reduction in benefit because of non-attendance at a work-focused interview. This applies both where the person's HB is reduced and when any other benefit that the person is receiving (such as IS) is subject to a sanction
  • reduction or loss of benefit due to a JSA employment sanction. JSA is not payable for the period of sanction if they have contributed towards their unemployment status, for example, by leaving employment voluntarily or failing to attend a prescribed training scheme. In such cases it may be possible for a reduced rate of JSA to be paid under the JSA hardship provisions
  • reduction in benefit due to a JSA sanction for 16/17 year olds – for certain young people who receive JSA under a Severe Hardship Direction. JSA is not payable for the period of the sanction if they have contributed towards their unemployed status, for example, by leaving employment voluntarily or failing to attend a prescribed training scheme
  • restriction in benefit due to a breach of a community service order
  • reduction in UC due to a sanction as specified under regulations 100 to 114 of the UC Regulations 2013

Benefit suspensions: HB or UC can be suspended either because there is a general doubt about entitlement or because a claimant has failed to supply information pertinent to their claim. In such cases, a DHP cannot be paid. One of the intentions of the suspension provisions is to act as a lever to ensure that the claimant takes the necessary steps to provide the authority with the required information/evidence - paying a DHP could reduce the effectiveness of this lever.

Council tax Support: when the person is getting Council Tax support but not HB or help with housing costs in UC: in other words, when a person is only getting local Council Tax support, you cannot award a DHP towards a rental liability.

Mortgage costs including interest payments: To qualify for an award of Discretionary Housing Payments, a relevant award of universal credit must include an amount of housing cost (as defined by section 11 of the Welfare Reform Act 2012) AND be calculated in accordance with Schedule 4 of The Universal Credit Regulations. Schedule 4 is for renters only. Schedule 5 is for housing costs element for owner-occupiers, and with the introduction of The Loans for Mortgage interest Regulations 2017, now mainly consists of some service charges only.

A notice period if you have had to move properties at short notice

Shortfalls caused by HB or UC overpayment recovery: when recovery of an HB or UC overpayment is taking place, such shortfalls should not be considered for a DHP.

From Annexe A of DWP Discretionary Housing Payments Guidance Manual 2022 (updated May 2022).