Social tenants in Scotland 2016

Section 5: Housing Costs and Income

5.1 Rent levels in social housing

Data from the Scottish Housing Regulator, as published in their Charter Indicators and Data by Outcomes and Standards ^[18] , shows that the average rent for a social sector property in Scotland in 2016/17 was £74.44, with housing association properties averaging £80.28 per week, 16% higher than the average rent of £69.20 for a local authority property.

Average housing association rents were higher than local authority rents for each property size category in 2016/17, with average housing association rents ranging from £69.96 per week for a 1 apartment property to £96.36 per week for a 5 apartment property. Local authority average weekly rents ranged from £59.71 for a 1 apartment property to £79.36 for a 5 apartment property.

Note that apartment size categories are based on a count of the number of bedrooms and living/dining rooms. Kitchens, bathrooms, toilets and utility rooms are not included.

Chart 5.1: Average weekly rents, 2016/17, by social landlord type and property size

The average rent of £74.44 for a social sector property in Scotland in 2016/17 was an increase of 2.1% on the previous year.

Over the four financial years from 2013/14 to 2016/17, average weekly social sector rents have increased by 4.5% from £67.96 in 2013/14 to £70.99 in 2014/15, after which there was an annual increase of 2.7% to £72.90 in 2015/16, following which there has been a 2.1% annual increase to £74.44 in 2016/17.

This is a cumulative increase of 9.5% between 2013/14 and 2016/17, which equates to a real terms increase of 5.0% (i.e. an increase of 5.0% over and above the level of CPI inflation over these years).

Average social sector rents have increased over each of the last two financial years for each property size category.

Chart 5.2: Average weekly rents, 2013/14 to 2016/17, for social rented housing

Table 5.1: Average weekly rents 2013/14 to 2016/17, by social landlord type and property size

	2013/14			2014/15			2015/16			2016/17
	housing association average	local authority average	All social housing average	housing association average	local authority average	All social housing average	housing association average	local authority average	All social housing average	housing association average	local authority average	All social housing average
1 apartment	Split not available		£59.45	£67.32	£57.82	£64.06	£69.27	£59.34	£65.97	£69.96	£59.71	£66.55
2 apartment			£65.01	£74.72	£61.81	£68.53	£76.52	£63.68	£70.38	£77.87	£64.90	£71.67
3 apartment			£66.87	£74.98	£65.33	£69.59	£76.91	£67.23	£71.54	£78.32	£68.89	£73.13
4 apartment			£72.71	£82.98	£70.08	£75.68	£85.12	£71.75	£77.60	£86.68	£73.66	£79.42
5 apartment			£81.83	£92.13	£75.57	£84.05	£94.59	£77.10	£85.98	£96.36	£79.36	£88.02
All sizes			£67.96	£76.92	£65.78	£70.99	£78.86	£67.60	£72.90	£80.28	£69.20	£74.44

Source: Scottish Housing Regulator Reports on the Scottish Social Housing Charter Findings

Note that apartment size categories are based on a count of the number of bedrooms and living/dining rooms. Kitchens, bathrooms, toilets and utility rooms are not included

Table 5.2 below shows average weekly social rents over the 3-year period from 2014/15 to 2016/17, by social rent provider and country. Average social rents in England were £97.84 per week for Private Registered Providers of social housing stock as at 31 March 2016, and £87.36 per week for local authority stock in 2016/17. Average social rents in Scotland in 2016/17 were therefore around 18% lower for housing association stock and 21% lower for local authority stock when compared with figures for England.

Table 5.2: Average weekly social rents, 2014/15 to 2016/17, by social rent provider and country

	2014/15	2015/16	2016/17
Housing Association Properties
Scotland	£76.92	£78.86	£80.28
England (Private Registered Providers of social housing stock)	£92.30	£95.89	£97.84
Wales	£79.16	£82.05	£83.93
Northern Ireland (rent gross of service charges)	£97.99	£101.71	n/a
Local Authority Properties
Scotland	£65.78	£67.60	£69.20
England	£85.89	£87.93	£87.36
Wales	£75.19	£78.44	£81.15
Northern Ireland (Northern Ireland Housing Executive)	£63.46	£66.60	£66.61

Sources:
Scottish Housing Regulator Reports on the Scottish Social Housing Charter Findings
MHCLG live tables on rents, lettings and tenancies (Table 702 and 704)
StatWales tables on social housing stock and rents
Northern Ireland Housing Statistics 2016/17

Note there may be some differences in the detail of how each set of average rent figures are calculated, therefore comparisons between countries should be seen as indicative rather than highlighting exact differences.

England figures for housing association properties are recorded as at 31st March 2014 for 2014/15, 31st March 2015 for 2015/16, and 31st March 2016 for 2016/17.

Average social rents in Wales were £83.93 per week for housing associations in 2016/17 and £81.15 per week for local authority stock in 2016/17. Average social rents in Scotland in 2016/17 were therefore around 4% lower for housing association stock and 15% lower for local authority stock when compared with the equivalent figures for Wales.

Average social rents in Northern Ireland were £101.71 per week for housing associations in 2015/16 (latest figure available), whilst local authority Northern Ireland Housing Executive rents averaged £66.61 per week in 2016/17. Average local authority rents in Scotland were therefore around 4% higher when compared with the equivalent figures for Northern Ireland. A comparison can’t be made in the latest year for housing association rents, but when looking at data for 2015/16 it can be seen that average housing association rents in Scotland were around 22% lower than the equivalent figures for Northern Ireland.

Chart 5.3 below shows a comparison between average social rents in Scotland for a 3 apartment property (i.e. 2 bedrooms plus 1 living room) and average private rents ^[19] in Scotland for a 2 bedroom property. It can be seen that social rents in Scotland for this size of property have been around half the level of private sector rents for each of the last three years 2013/14 to 2016/17.

Chart 5.3: Average weekly rents Scotland, 2013/14 to 2015/16, by sector (private sector rent years to end September)

5.2 Household income – banded net income

The Scottish Household Survey collects information on the annual net income of households. In 2016, 29% of social rented households had a net household income of between £10k and £15k, whilst 20% had income of between £15k and £20k.

Chart 5.4: Net income of social rented households, 1999, 2007 and 2016

The distribution of income levels appears to have shifted upwards from 1999 to 2015. For example, in 1999 22% of social rented households had a net income of £6k or less, and this has dropped to 3% of households in 2016. Correspondingly only 3% of social rented households had a net income of more than £20k in 1999, and this has increased to 29% of households in 2016. Some of these changes may be due to general inflation levels across the time period 1999 to 2016.

There was little difference in net household income between local authority and housing association households in 2016, as shown in Chart 5.5 below.

Chart 5.5: Net income of social rented households, 2016, by social landlord

Chart 5.6 below shows the net annual income of social rented households between 2013 and 2016 for each local authority. Orkney had the highest proportion earning less than £10,000 a year (30%) whereas Shetland had the highest proportion earning over £30,000 a year (21%).

Chart 5.6: Net annual income of social rented households, 2013 to 2016, by local authority

Note: survey data from the four years from 2013 to 2016 has been combined together to provide a sufficient sample size to allow a local authority level analysis. However local authority sample sizes across these four years vary from 100 in East Renfrewshire up to 1,260 in Glasgow City, and so there will be larger margins of error for some local authorities than others, and as such some differences between local authorities should be treated with caution, as these might reflect sampling variation rather than real changes.

There were differences in net income levels in 2016 between different tenures. In 2016, 68% of social rented households had a net income of £20k or less, which compares to 45% of private rented households, 45% of households owned outright and 16% of households buying with a mortgage.

Chart 5.7: Net income of households, 2016, by tenure

Information about household income is also collected through the Family Resources Survey ^[20] . Chart 5.8 below shows the net household income profiles of households by tenure over the 3-year period from 2013/14 to 2015/16, based on the Family Resources Survey. The data shows similarly shaped income distributions to the Scottish Household Survey based analysis in Chart 5.7 above.

Chart 5.8: Net income of households, by tenure, 2013/14 to 2015/16

Chart 5.9 below shows the distribution of net household income for social rented households, by country, and Table 5.3 shows the percentages for all tenures. For social rented households, the distributions of incomes in Scotland were broadly similar to the other countries in GB, however there were some differences, for example, the percentage of social households earning less than £15k was higher in Scotland (46%) than in England (39%). There were also some differences in the private rented sector; Table 5.3 below shows that 19% of households in England were in the top income bracket, which was higher than the equivalent percentages for Scotland (13%), or Wales (12%).

Chart 5.9: Net income of social rented households, 2013/14 to 2015/16, by country

Table 5.3: Net annual income of households, by country and tenure, 2013/14 to 2015/16

		£0 - £6,000	£6,001 - £10,000	£10,001 - £15,000	£15,001 - £20,000	£20,001 - £25,000	£25,001 - £30,000	£30,001 - £40,000	£40,000+	All	Base
Scotland	Social Housing	3	15	27	20	13	9	8	3	100	2,044
	Private Rented Sector	4	8	18	17	16	10	15	13	100	1,187
	Buying with Mortgage	1	2	6	9	11	10	20	41	100	2,283
	Owned Outright	3	8	16	17	12	11	14	21	100	2,970
England	Social Housing	3	10	26	22	15	9	9	6	100	7,615
	Private Rented Sector	3	6	13	16	15	13	17	19	100	6,985
	Buying with Mortgage	1	2	4	7	9	11	22	44	100	12,240
	Owned Outright	3	9	16	15	13	10	14	20	100	14,767
Wales	Social Housing	2	12	31	26	13	6	6	4	100	437
	Private Rented Sector	4	12	20	16	16	8	10	12	100	356
	Buying with Mortgage	1	2	8	9	10	12	23	35	100	676
	Owned Outright	4	11	17	16	12	13	10	17	100	1,049

Source: Family Resources Survey 2013/14 to 2015/16

Based on the Scottish Household Survey data, looking at social rented households in Scotland in which an adult had moved into the address within the last 12 months (which includes new-lets as well as changes to existing household compositions), 28% had a net income of over £20k, a figure similar to the equivalent percentage of 29% for all social households in 2016.

Chart 5.10: Net income of social rented households where an adult has moved into the address within the last 12 months

5.3 Households in the lowest income quintile

Income quintiles divide households into 5 equally sized groups to reflect their net household income. For the purposes of this analysis, household responses to the Family Resources Survey have been ranked by their net unequivalised income, from lowest to highest ^[21] . The ranked dataset has then been divided into 5 equally sized groups, where households with the lowest incomes are in the first quintile, right through to the households with the highest income, which are in the fifth quintile. In this section, the lowest income quintile refers to the 1 in 5 (20%) of households in each of Scotland, England, or Wales, that have the lowest net household income in each of these countries.

Chart 5.11 below shows that a greater percentage of social rented households are in the lowest income quintile. In 2013/14 to 2015/16, 36% of social rented households were in the lowest income quintile group in Scotland, which broke down to 36% for local authorities and 37% for housing associations, and which was higher than the equivalent percentages for other tenures (22% of private rented households, 20% of households who own outright and 6% of households who own with a mortgage).

The category of households owned outright is likely to include some retired people who have already bought their houses and who are now on relatively low incomes, who could be described as “asset rich and cash poor”.

Patterns of change over time are not particularly clear. Whilst the survey data presented suggests decreases in the proportion of local authority and private rented households that are in the lowest income quintile, due to sampling variation there is insufficient evidence to say whether or not these decreases are genuine.

Chart 5.11: Percentage of households in lowest income quintile, Scotland

The chart below provides a comparison of Scotland with other countries in the UK for the period 2013/14 to 2015/16. There was little difference between countries. For local authority housing, Scotland (36%) and England (36%) showed similar proportions of households in the lowest income quintile, which was higher than the percentage in Wales (28%). In the housing association sector, the percentages ranged from 29% in Wales to 35% in England and 37% in Scotland. In the private rented sector, 22% of households in Scotland were in the lowest income quintile, higher than the 19% in England (there was insufficient evidence to say whether the difference between Scotland and Wales reflects a genuine difference).

Chart 5.12: Percentage of households in lowest income quintile in each country, 2013/14 to 2015/16

5.4 Housing costs as a proportion of income

Table 5.4 and Chart 5.13 below show the median ratio of housing costs as a proportion of net household income from 2006/07 to 2015/16 for each tenure category. This analysis is based on the ‘ratio of housing costs to income’ which is also used as an indicator in the Scottish Government Housing and Regeneration Outcome Indicators Framework ^[22] , with additional analysis to split out social rented into the constituent categories of local authority and housing association households. In this analysis Housing Benefit payments are included in the net household income. Net income is the total income received by the households excluding taxes such as income tax and council tax. Net income has not been adjusted (“equivalised”) for family size. Housing costs include rent gross of Housing Benefit, as well as water rates and service charges where applicable.

For the analysis presented in this report, pooled samples across 3 or 4 years of data have been used to improve statistical reliability. Across the 3-year period from 2013/14 to 2015/16, local authority households in Scotland spent on average 23% of their net household income on housing costs, a figure similar to the equivalent percentage of 25% for housing association households. The social sector combined ratio over 2013/14 to 2015/16 was 24%. These figures compare to equivalent figures of 25% for private rented households, 9% for households owned with a mortgage and 3% for households owned outright. The similar ratio figures between social households and private rented households is likely to reflect those in the private rented sector having higher average rental costs but also having higher average income levels to those in social housing.

Table 5.4: Median ratio of housing costs to net unequivalised by tenure, Scotland only

	2006/07 to 2009/10		2010/11 to 2012/13		2013/14 to 2015/16
	Ratio	Base	Ratio	Base	Ratio	Base
Local Authority	22%	2,581	22%	1,492	23%	1,229
Housing Associations	25%	1,689	24%	1,044	25%	815
Social sector	23%	4,270	23%	2,536	24%	2,044
Private rented	26%	1,543	27%	1,274	25%	1,187
Owned with mortgage	12%	5,679	9%	3,159	9%	2,283
Owned outright	3%	5,022	3%	3,410	3%	2,970

Source: Family Resources Survey

Housing costs as a proportion of income for those owning with a mortgage or who own outright are lower than each of the rented sectors, which may reflect either higher average household incomes or lower housing costs. In particular, households who own their properties outright have no rental or mortgage costs.

In Scotland, average ratios of housing costs to net household income have remained relatively stable over time within each tenure category. Broadly, the patterns of change over time are unclear, however there has been a decrease in the median ratio of housing costs to income in for households owned with a mortgage, from 12% in 2006/07 to 2009/10 to 9% in 2013/14 to 2015/16.

Chart 5.13: Median ratio of housing costs to net unequivalised household income, by tenure and year, Scotland

Chart 5.14 below illustrates how the average ratios of housing costs to income have differed for each GB country over the 3-year period from 2013/14 to 2015/16. Social rented households in Scotland were on average paying less on housing costs as a proportion of income (24%) than households in England (30%) and a similar ratio to Wales (28%).

Chart 5.14: Median ratio of housing costs to net unequivalised household income, 2013/14 to 2015/16, by tenure and country

Table 5.5: Median ratio housing costs to net unequivalised, 2013/14 to 2015/16, by tenure and country

	Scotland		England		Wales
	Ratio	Base	Ratio	Base	Ratio	Base
Local Authority	23%	1,229	28%	3,581	27%	229
Housing Associations	25%	815	31%	4,034	30%	208
Social sector	24%	2,044	30%	7,615	28%	437
Private rented	25%	1,187	32%	6,985	29%	356
Owned with mortgage	9%	2,283	10%	12,240	9%	676
Owned outright	3%	2,970	3%	14,767	3%	1,049

Source: Family Resources Survey

Using these ratios, it is also possible to estimate how many households are spending more than 30% of the income on housing costs, as shown in Chart 5.15 below which covers the 3 year period from 2013/14 to 2015/16. In the social sector, 32% of households in Scotland were spending more than 30% of their net income on housing costs, lower than the 50% seen in England and 46% seen in Wales. Findings for local authority and housing associations are also presented, however caution is required when comparing countries due to smaller sample sizes. In the private rented sector, 39% of households in Scotland were spending more than 30% of their net income on housing costs, similar to the 49% in Wales, but lower than the 55% seen in England.

Chart 5.15: Percentage of households spending more than 30% of net household income on housing costs, 2013/14 to 2015/16

5.5 Financial support - Housing Benefit and Discretionary Housing Payments

Housing Benefit is available to support eligible low income households with the cost of renting their home. It cannot be used to pay for other costs, such as food or heating, and households that do not pay rent (e.g. because they are owned with the help of a mortgage) are not eligible. The award can cover the whole cost of rent or part of it, depending on income, circumstances, and other factors such as the type of landlord and local housing allowance rates.

Universal Credit is being introduced in stages across the UK. It will eventually replace Housing Benefit, income support, income-related employment and support allowance, income-based jobseeker's allowance, child tax credits, and working tax credit. Some Universal Credit claimants will receive the housing element, which will provide help with rent costs. By March 2016, Universal Credit Live Service had been introduced to nearly all areas of Scotland for single jobseekers and East Lothian became the first area in Scotland to receive Universal Credit Full Service for all claimants. In addition, from 2015 a Universal Credit pilot expanded beyond the existing single claimant group for claimants in Inverness. At March 2016 there were 6,160 Universal Credit awards with housing elements paid to claimants in the Social Rented sector, and 2,902 to claimants in the private rented sector.

Chart 5.16 below shows the percentage of households receiving Housing Benefit from 2011 to 2016 for each tenure, for Scotland, England and Wales, based on data from Department of Work and Pensions ( DWP), StatXplore and Ministry of Housing, Communities and Local Government ( MHCLG) stock by tenure figures.

Chart 5.16: Housing Benefit claimants as a percentage of dwellings by tenure and country

Table 5.6 shows that in Scotland, the percentage of households receiving Housing Benefit has decreased across all of the rented housing sectors between 2011 and 2016, now standing at 60% of local authority households, 62% of housing association households, and 23% of private rented sector households.

The percentage of households receiving Housing Benefit in Scotland is slightly lower than England or Wales across all three rented tenure categories. For example, in 2016, 60% of local authority households in Scotland received Housing Benefit, compared to 67% in England and 70% in Wales.

In March 2016, there were also some households in receipt of the housing element of Universal Credit. The figures in Tables 5.6, 5.7 and 5.8 show that these households equated to 1% of social sector and 1% of private sector households in Scotland, England and Wales.

Table 5.6: Number of households and percentage of households in receipt of housing support by tenure at end March each year, Scotland

		2011	2012	2013	2014	2015	2016
Local Authority	Number of households	320,000	319,000	318,000	318,000	317,000	317,000
	Received Housing Benefit	207,121	206,938	205,019	199,597	196,183	190,119
	% receiving HB	65%	65%	64%	63%	62%	60%
Housing Association	Number of households	275,000	277,000	277,000	278,000	278,000	278,000
	Received Housing Benefit	177,289	179,884	179,743	177,854	175,939	171,560
	% receiving HB	64%	65%	65%	64%	63%	62%
Social Sector	Number of households	595,000	597,000	596,000	595,000	595,000	594,000
	Received Housing Benefit	384,410	386,822	384,762	377,451	372,122	361,679
	Received Universal credit housing element						6,160
	% receiving Housing Benefit	65%	65%	65%	63%	63%	61%
	% receiving UC Housing Element						1%
Private rented	Number of households	303,505	347,324	368,468	374,748	381,929	394,022
	Received Housing Benefit	90,267	96,723	99,633	98,707	96,187	90,047
	Received Universal Credit Housing Element						2,902
	% receiving Housing Benefit	30%	28%	27%	26%	25%	23%
	% receiving UC Housing Element						1%

Note: Universal Credit claimant statistics for for March 2015 are not available, however there would have been a small number of claimants at that point in time.

Sources: DWP StatXplore, Stock by tenure figures from MHCLG Live Tables and Housing Statistics for Scotland

Table 5.7: Number of households and percentage of households in receipt of housing support by tenure at end March each year, England

		2011	2012	2013	2014	2015	2016
Local Authority	Number of households	1,726,000	1,693,000	1,682,000	1,669,000	1,643,000	1,612,000
	Received Housing Benefit	1,203,705	1,196,152	1,175,645	1,150,260	1,125,040	1,078,936
	% receiving HB	70%	71%	70%	69%	68%	67%
Housing Association	Number of households	2,255,000	2,304,000	2,331,000	2,343,000	2,387,000	2,430,000
	Received Housing Benefit	1,568,111	1,626,130	1,656,817	1,644,308	1,627,277	1,626,244
	% receiving HB	70%	71%	71%	70%	68%	67%
Social Sector	Number of households	3,981,000	3,997,000	4,013,000	4,012,000	4,030,000	4,042,000
	Received Housing Benefit	2,771,816	2,822,282	2,832,462	2,794,568	2,752,317	2,705,180
	Received Universal credit housing element						32,742
	% receiving Housing Benefit	70%	71%	71%	70%	68%	67%
	% receiving UC Housing Element						1%
Private rented	Number of households	4,105,000	4,286,000	4,465,000	4,623,000	4,773,000	4,847,000
	Received Housing Benefit	1,376,314	1,455,055	1,485,416	1,466,129	1,395,103	1,314,170
	Received Universal Credit Housing Element						35,885
	% receiving Housing Benefit	34%	34%	33%	32%	29%	27%
	% receiving UC Housing Element						1%

Note: Universal Credit claimant statistics for for March 2015 are not available, however there would have been a small number of claimants at that point in time.

Sources: DWP StatXplore, Stock by tenure figures from MHCLG Live Tables and Housing Statistics for Scotland

Table 5.8: Number of households and percentage of households in receipt of housing support by tenure at end March each year, Wales

		2011	2012	2013	2014	2015	2016
Local Authority	Number of households	89,000	88,000	88,000	88,000	88,000	87,000
	Received Housing Benefit	64,837	65,134	64,709	63,266	62,319	60,948
	% receiving HB	73%	74%	74%	72%	71%	70%
Housing Association	Number of households	134,000	135,000	135,000	135,000	136,000	137,000
	Received Housing Benefit	99,286	101,146	101,782	100,931	100,382	99,883
	% receiving HB	74%	75%	75%	75%	74%	73%
Social Sector	Number of households	223,000	223,000	223,000	223,000	224,000	224,000
	Received Housing Benefit	164,123	166,280	166,491	164,197	162,701	160,831
	Received Universal credit housing element						1,226
	% receiving Housing Benefit	74%	75%	75%	74%	73%	72%
	% receiving UC Housing Element						1%
Private rented	Number of households	180,000	189,000	188,000	196,000	208,000	202,000
	Received Housing Benefit	79,123	84,203	87,289	86,684	84,627	80,805
	Received Universal Credit Housing Element						1,739
	% receiving Housing Benefit	44%	45%	46%	44%	41%	40%
	% receiving UC Housing Element						1%

Note: Universal Credit claimant statistics for for March 2015 are not available, however there would have been a small number of claimants at that point in time.

Sources: DWP StatXplore, Stock by tenure figures from MHCLG Live Tables and Housing Statistics for Scotland

Chart 5.17 shows the median percentage of housing costs covered by Housing Benefit, as measured by the Family Resources Survey over the period from 2013/14 to 2015/16. The average figures presented have been calculated based on the median ratio of the value of Housing Benefit received as a proportion of total housing costs for each household in the survey. Note that the calculation only includes households that are in receipt of some amount of Housing Benefit.

Percentages of housing costs covered by Housing Benefit can be lower than claimant rates for a number of reasons:

• If the claimant’s income exceeds a pre-determined amount (the applicable amount), then the Housing Benefit award will be less than their rent.
• If the household is in the private sector, Housing Benefit amounts can be capped at the Local Housing Allowance rate.
• Housing benefit can only cover rent costs whereas housing costs can include other charges such water rates, ground rent, and service charges.
• The spare room subsidy (also known as the ‘bedroom tax’) can reduce Housing Benefit for households in the social sector if the household is deemed to have more bedrooms that required for the residents of the household. The bedroom tax is mitigated in Scotland through Discretionary Housing Payments.

When looking at local authority households in Scotland in receipt of Housing Benefit, the average (median ratio) value of housing costs covered by Housing Benefit was 94% (see Chart 5.17 below). This means that when looking at the ratio of Housing Benefit to housing costs for each household and then ordering these from low to high, the median (middle) value of all these ratios was 94%. The figure was the same (94%) for housing association households. For private rented households the equivalent figure was 84%.

Social rented households in Scotland had a median value of 94% of housing costs covered by Housing Benefit, a figure higher than the equivalent percentage for England (89%) The figure for Wales was also 89% however due to sample sizes there is insufficient evidence to say whether or not this is significantly different to Scotland’s figure.

Housing costs can include more than just rent, and therefore for many households Housing Benefit is likely to make up a higher proportion of rent than compared to total housing costs. When looking at the ratio of Housing Benefit to rental costs for each social rented household and then ordering these from low to high, the median (middle) value of all these ratios is estimated to be 100% (i.e. more than half of social rented households are receiving Housing Benefit that covers their rent by 100%). An estimated 65% of social rented households are estimated to have their rent fully covered by Housing Benefit.

Chart 5.17: Median percentage of housing costs covered by Housing Benefit for claimants in Scotland, 2013/14 to 2015/16

Discretionary Housing Payments ( DHPs) are administered in Scotland by local authorities, and may be awarded when a local authority considers that a claimant on Housing Benefit or Universal Credit (which includes a housing element towards rental liability) requires further financial assistance towards housing costs.

During 2016/17, the UK Government made £15.2 million available to Scottish Local Authorities for DHP funding. The Scottish Government made an additional £35 million available, money estimated to be sufficient for local authorities to fully mitigate the Removal of the Spare Room Subsidy, also known as the ‘bedroom tax’.

During 2016/17, almost 113,000 DHP awards were granted, with an average award value of £460. This figure is likely to include a sizeable number of cases affected by the Removal of the Spare Room Subsidy, where local authorities continued to make up their shortfall in weekly rent through the use of DHPs. The total value of awards spent across Scotland in 2016/17 was £51.9 million.

For further details see Discretionary Housing Payments in Scotland Statistics publications available at http://www.gov.scot/Topics/Statistics/Browse/Social-Welfare/dhp.

5.6 How well households are managing financially

The Scottish Household Survey asks respondents how well their household is managing financially. In the latest year (2016), 31% of social rented households stated that they managed well, an increase from 21% in 1999.

Chart 5.18: How well social households are managing financially, 1999, 2007 and 2016

There is very little difference in responses between local authority and housing association households in 2016, with similar percentages being reported for each category.

Chart 5.19: How well social households are managing financially, 2016, by social landlord

Chart 5.20 below shows how well social rented households are managing financially between 2013 and 2016 for each local authority. Orkney had the highest proportion reporting they are managing well (42%) whereas Perth & Kinross and Glasgow had the lowest proportions reporting they were managing well financially (both 21%).

Chart 5.20: How well social households are managing financially, 2013 to 2016, by local authority

Note: survey data from the four years from 2013 to 2016 has been combined together to provide a sufficient sample size to allow a local authority level analysis. However local authority sample sizes across these four years vary from 100 in East Renfrewshire up to 1,260 in Glasgow City, and so there will be larger margins of error for some local authorities than others, and as such some differences between local authorities should be treated with caution, as these might reflect sampling variation rather than real changes.

Chart 5.21 below shows how social households compare to other tenures for how well they are managing financially in 2016. Social households are less likely to be managing well (31%) compared with private rented households (45%), households buying with a mortgage (63%) and households who own outright (73%). Correspondingly social households are more likely to not be managing well (18%) compared with other tenures (11% for private rented households, 5% for households buying with a mortgage and 2% for households who own outright).

Chart 5.21: How well households are managing financially, 2016, by tenure

When looking at social rented households in Scotland in which an adult had moved into the address within the last 12 months (which includes new-lets as well as changes to existing household compositions), 23% stated they managed well in 2013 to 2016, a figure lower than the equivalent percentage (31%) for all social households in 2016. Whilst 27% stated they did not manage well in 2013 to 2016, a figure higher than the equivalent percentage (18%) for all social households in 2016. This suggests that newly formed social rented households are less likely to be managing well financially than more established social rented households.

Chart 5.22: Financial management of social rented households, where an adult has moved into the address within the last 12 months