South Hams Citizens Advice have claimed that just an increase to the Local Housing Allowance benefit will not address the inequalities currently facing private renters on benefits in the South Hams.

In last week’s autumn statement, the Chancellor announced an increase to the LHA alongside a multitude of tax cuts and a minimum wage increase.

The Chancellor of the Exchequer, Jeremy Hunt, announced an earlier than expected round of tax cuts to national insurance and business rates, as well as an increase to the minimum wage for over 21’s to £11.44 an hour.

But perhaps most significantly for the South Hams was an increase to the Local Housing Allowance benefit to at least reach the top 30th percentile of individuals rent in private housing.

South Hams Citizens Advice recently published a report asking for LHA to be increased after a three year freeze. The increase in this benefit will relieve the burden for people on universal credit and trying to afford monthly rent in the private sector.

South Hams Citizens Advice responded to the autumn statement saying: “We welcome the Chancellor’s decision to return the LHA to the 30th percentile but this very blunt tool does not redress the inequalities uncovered by our research.  Average rents across the UK increased 11.7% in the 12 months to Sept 23 but by 28% across the South Hams.  

“In places like South Hams where there is already an incredibly short supply of affordable housing to rent, demand for second homes and holiday lets puts additional pressure on the housing market and rents skyrocket. Increasing the LHA will do little to redress the financial hardship felt by local people who are forced to rent at premium prices.

“Tenants living in these rural communities are put at significant financial disadvantage and we will continue to call for the boundaries of the Broad Rental Market Area to be redrawn.”

Anthony Mangnall MP for Totnes said of the LHA increase: “I think it makes an absolutely enormous difference and this is about making sure we recognise the impact inflation had had on it and we can get it to a stage where we can it to a stage where it will be more beneficial to people across the whole country and obviously when you couple this with the national living wage which we are increasing to £11.44 an hour, a 9.8% increase, this is stuff that is going to make a real difference and when you couple that again with the national insurance cut of 2% you’re really putting some meaningful cash into peoples bank accounts."

The Chancellor also announced a two percent cut to national insurance which will be implemented from January 6th 2024, increasing after tax wages for 27 million workers.

It was also announced that alcohol duty will be frozen until August 2024, encouraging people to buy alcoholic drinks from pubs and restaurants rather than supermarkets.

The Chancellor encouraged local authorities to speed up planning applications for businesses by promising financial incentives for those who process them quickly and allow business to grow in their area.

Sir Gary Streeter MP for South West Devon said: “I thought it was focused and skilful. I strongly support the tax cuts for the self-employed and support for small businesses- the backbone of the South West Devon constituency. Also, the push to get people back to work is very welcome. Hard working people are fed up with the stubborn minority who abuse our generous benefit system. It was an autumn statement for growth.”

The Chancellor also promised £500 million for the technology sector, to fund AI innovation. Mr Mangnall added: “I’m going to be speaking to the Chancellor about seeing if we can attract some of that money into the South West, obviously I think we should be much more proactive in and positive about where we lead in terms of financial services and financial technology. But we should be very very positive about where we lead in AI, quantum computing and photonics and areas like this. Of course, South Devon is home to a large chunk of the photonics sector, and I want to make sure that it is playing its part. So, it’s very welcome to see the chancellor recognising this, but it’s also playing to our strength and that’s exactly what we need to do if we want to see the economy grow.”