Reconsider the deferred Housing Benefit child personal allowances #2825

Summary

Under the Secretary of State's Housing Benefit regulations, councils add a personal allowance for each child or young person in the claimant's family: £87.88 a week in 2026-27, for pension-age and working-age claimants alike. The model's housing_benefit_applicable_amount has no term for it under either set of regulations, though it adds the two child disability premiums (#2221) and the protected family premium (#2223). For a pension-age claimant with one child, the model therefore leaves out £87.88 a week (£4,569.76 a year), and one more amount for each further child. #1933 adds the same amount to pension-age Council Tax Reduction, so Housing Benefit would remain the only one of the two that omits it.

We document the omission as deferred (#2232, and docs/book/assumptions/housing-benefit-child-allowances.md), because we cannot tell from current ages which children kept protection under the two-child restriction, or what a Child Tax Credit assessment included. The Secretary of State removed the restriction for pension-age Housing Benefit from 8 June 2024 (SI 2024/611 regs 1 and 6) and for working-age Housing Benefit from 6 April 2026 (SI 2026/316 regs 1 and 2(2)), the dates #2232 records. From 2026-27 every child counts and the amount needs no claim history, and in the restricted years a family with one or two children always got an amount for each child. We propose reconsidering that deferral and adding the amount, at least where no restriction applies.

What the law says

Pension-age Housing Benefit: SI 2006/214

Regulation 22(1) (reg 22):

Subject to regulations 61 and 62 and Schedule A1 […], the applicable amount of a claimant shall be the aggregate of such of the following amounts as apply in his case— (a) an amount in respect of his personal allowance, determined in accordance with paragraph 1 of Schedule 3; (b) an amount determined in accordance with paragraph 2 of that Schedule in respect of ... children or young persons ... who are members of his family; (c) if he is a member of a family of which at least one member is a child or young person, an amount determined in accordance with paragraph 3(1) of Part 2 of that Schedule (family premium); […] (e) the amount of any premiums which may be applicable to him, determined in accordance with Parts 3 and 4 of that Schedule (premiums).

The Secretary of State removed the words the ellipses mark in (b), with effect from 8 June 2024. SI 2024/611 regulation 6, headed "Abolition of the two child limit for pension age housing benefit", reads: "(a) in paragraph (1)(b)— (i) omit “up to two individuals who are either”; and (ii) omit “and”; (b) omit paragraphs (5A) to (5D)." By regulation 1, the Regulations "come into force on 8th June 2024".

Schedule 3 paragraph 2(1) (Sch 3):

The amounts specified in column (2) below in respect of each person specified in column (1) shall, for the relevant period specified in column (1), be the amounts specified for the purposes of regulation 22— […] Person in respect of the period— (a) beginning on that person's date of birth and ending on the day preceding the first Monday in September following that person's sixteenth birthday; | (a) £87.88; (b) beginning on the first Monday in September following that persons 16th birthday and ending on the day preceding that person's twentieth birthday. | (b) £87.88.

The Secretary of State set the amount in the Social Security Benefits Up-rating Order 2026, article 24(6)(b): "in paragraph 2(1), in sub-paragraphs (a) and (b) of column (2) of the table for “£84.66” substitute “£87.88”".

The model already handles the family premium (housing_benefit_family_premium gates it on a protection category) and the enhanced disability and disabled child premiums (housing_benefit_child_disability_premiums).

Working-age Housing Benefit: SI 2006/213

Under regulation 22(1)(b), councils add "an amount determined in accordance with paragraph 2 of Schedule 3 in respect of children or young persons who are members of his family" (reg 22). The Secretary of State gave it that form from 6 April 2026, in SI 2026/316 regulation 2(2): "(a) in paragraph (1)(b) for “up to two individuals who are either children or young persons and” substitute “children or young persons”; (b) omit paragraphs (2) to (5)." Councils use the same £87.88 for each child or young person under Schedule 3 paragraph 2(1) (Sch 3); the Secretary of State set that figure in article 23(6)(b) of the 2026 Order: "for “£84.66” substitute “£87.88”".

What the model does now

Line numbers refer to main at 2da212abc; #1933 does not change these files.

• In policyengine_uk/variables/gov/dwp/housing_benefit/housing_benefit_applicable_amount.py:77-109, the model adds up the adult personal allowance (single, couple or lone parent, by age and by the pension-age switch housing_benefit_pension_age_regulations_apply), benefits_premiums, housing_benefit_family_premium, housing_benefit_child_disability_premiums and housing_benefit_main_phase_esa_allowance_adjustment. It counts no children for the paragraph 2 amount, under either set of regulations.
• policyengine_uk/parameters/gov/dwp/housing_benefit/allowances/ holds single, couple, lone_parent, age_threshold and pension_age_cutoff, and no child or young person amount.
• In docs/book/assumptions/housing-benefit-child-allowances.md, we record the omission (lines 3-11) and keep implementation deferred under Document deferred historical Housing Benefit child-allowance rules #2232 (lines 98-113): "This includes the proposal to implement only unrestricted periods."
• housing_benefit_child_disability_premiums.py and housing_benefit_family_premium.py count children through is_child_or_young_person_for_legacy_benefits, which a child amount can reuse.

Reproduction

We ran 2026 households in Maidstone, Cardiff and Glasgow, each with a 72-year-old private renter, State Pension of £12,570, no savings and annual rent of £6,000. Each claims Housing Benefit and declines Pension Credit and Universal Credit. B0 has no child; in B1 we add a ten-year-old with no disability benefit, and in B2 we give the child the highest DLA care rate. In B0c and B1c we add £5,000 of private pension. For 2025, we also ran a 35-year-old in Maidstone who reports an existing Housing Benefit award: W0 lives alone and W1 has a ten-year-old. The Python situation below sets up B1 in England; change the child's inputs, location or private pension for the other cases.

situation = {
    "people": {
        "pensioner": {"age": {2026: 72}, "state_pension": {2026: 12_570}},
        "child": {"age": {2026: 10}},
    },
    "benunits": {"benunit": {
        "members": ["pensioner", "child"],
        "would_claim_pc": {2026: False},
        "would_claim_uc": {2026: False},
        "would_claim_housing_benefit": {2026: True},
    }},
    "households": {"household": {
        "members": ["pensioner", "child"],
        "country": {2026: "ENGLAND"},
        "local_authority": {2026: "MAIDSTONE"},
        "brma": {2026: "MAIDSTONE"},
        "tenure_type": {2026: "RENT_PRIVATELY"},
        "rent": {2026: 6_000},
        "council_tax": {2026: 2_000},
        "savings": {2026: 0},
    }},
}

Expected and model amounts

For this pensioner in 2026-27, councils use a personal allowance of £256.00 (Sch 3 para 1(1)(b)) and a child or young person amount of £87.88 (para 2(1)(a)). They give no family premium on a claim made after 1 May 2016, and for the B2 child they add a disabled child premium of £84.46 and an enhanced disability premium of £33.99. We multiply weekly amounts by 52. The same regulations cover England, Wales and Scotland.

So the model's B1 equals its B0, where councils add 87.88 × 52 = 4,569.76, and its B2 exceeds B0 by the child disability premiums alone.

In 2025-26, councils used a working-age child amount of £84.66 (the figure the Secretary of State replaced in article 23(6)(b) of the 2026 Order). The single (25 or over) and lone parent (18 or over) allowances had the same value, so W0 and W1 share a personal allowance. The model gives £4,786.60 for both W0 and W1, where councils add 84.66 × 52 = 4,402.32 for the child.

Effect on the award

In B0 to B2 the pensioner's income (£241.73 a week) falls short of £256.00, so the child amount would not change the award; the model gives £6,000.00 against an eligible rent of £6,000.00. With £5,000 of private pension, B1c has applicable income of £16,570.00 in the model. That falls short of the statutory £17,881.76, so the claimant gets the appropriate maximum Housing Benefit, 100% of their eligible rent of £6,000 (SSCBA 1992 s.130(3)(a); SI 2006/214 reg 50). The model compares the income with its applicable amount of £13,312.00, deducts 65% of the excess (reg 51) and gives £3,882.30, the same as for B0c without the child (£3,882.30).

Scope of a fix

1. Parameter. Add gov.dwp.housing_benefit.allowances.child_or_young_person, a weekly amount, with 84.66 from 2025-04-01 and 87.88 from 2026-04-01 (2026 Order articles 23(6)(b) and 24(6)(b)). Source earlier years from each year's Up-rating Order. Northern Ireland's regulations need their own check.
2. Restriction. Add the two-child limit with its dates for each set of regulations, ending on 7 June 2024 for pension-age and 5 April 2026 for working-age Housing Benefit (SI 2024/611; SI 2026/316). Within the restricted years, a model that counts up to two children gives the right amount for every family with one or two children, and understates a family with three or more whose children kept protection or whose Child Tax Credit assessment included more. Document deferred historical Housing Benefit child-allowance rules #2232 deferred this component in full, including unrestricted periods. To implement this proposal, we would reopen that decision and need agreement on the required facts, absent-data behaviour and changes within a year.
3. Variable. Add housing_benefit_child_amounts (BenUnit, YEAR, GBP): the number of is_child_or_young_person_for_legacy_benefits members, limited as in step 2, times the weekly amount, times WEEKS_IN_YEAR. Add it to the return of housing_benefit_applicable_amount.
4. Documentation and tests. Update parameters/gov/dwp/housing_benefit/README.md and docs/book/assumptions/housing-benefit-child-allowances.md, and the lone-parent cases in housing_benefit_applicable_amount.yaml that assert the omission. Add YAML cases B0 to B2 and W0 to W1, and property tests for these invariants: the amount is nil without a child or young person; it adds per child in unrestricted periods and stops at two in restricted ones; both sets of regulations give the same amount per child; and the applicable amount never falls when a child joins the family. Add a differential test: for an English pension-age family in 2025 and 2026, the Housing Benefit child amount equals council_tax_reduction_pensioner_child_amounts from Pensioner council tax reduction: applicable amount (post-April-2021 allowance, children, severe disability premium) and income (Child Benefit, tariff income) #1933, since both use £84.66 and £87.88 in those years.

We have not estimated the population impact.

Related: #2232, #2221, #2223, #1933.

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