The Resolution Foundation has urged Prime Minister Andy Burnham to increase housing benefit spending by £2 billion annually by linking Local Housing Allowance (LHA) rates to local rental prices at the October 28 Budget. This matters because LHA rates have been frozen since April 2024 despite rising rents, leaving claimants with growing monthly shortfalls; the think tank argues that relinking rates to rents would improve rental affordability for low-income families.

Housing benefit currently totals £39 billion annually, with over a million new eligible claimants since 2020. Families in Inner East London face typical monthly shortfalls of up to £324, and gaps exceed £100 in over half of English areas. The proposal has sparked political controversy: opposition Conservative figures oppose increased spending, with Kemi Badenoch instead proposing £4 billion in cuts to fund defence spending. The think tank contends that unfreezing LHA would genuinely improve affordability rather than simply inflate landlord profits.