Also housing allowance for the free sector, but around 300,000 tenants are declining

The cabinet wants to implement a major change in the housing allowance system: the surcharge no longer depends on the amount of the rent, but only on income. This is stated in a bill by Minister De Jonge for Housing and Spatial Planning.

This proposal allows people with a low income and high rent in the free sector to also receive housing allowance. This is expected to concern around 136,000 households.

Furthermore, in the plans, around million households that now receive housing allowance are improving. At the same time, there is also a group of more than 290,000 households that are declining in the plans: they will receive up to 98 euros per month less housing allowance.

Low income, high rent

Currently, you get housing allowance if you are over 23 years old and have a rent of 763.47 euros or lower. For younger people, a maximum rental amount of more than 440 euros applies. This expires in the new bill and categories with fixed amounts will replace that. Also, service costs are no longer considered.

The fixed rent is a fictitious rent with which the Tax Authorities want to count from now on when granting the housing allowance. So it no longer looks at the rent that someone pays. For example, do you have a rent of 650 euros, are you an adult and have a low income? From now on, the tax authorities will charge with a rental amount of 520 euros.

And that can have consequences for the surcharge, because people with a higher rent than the fixed amount will receive less surcharge. The government wants to compensate for this by reducing rents for the lowest incomes (up to 120 percent of the social minimum) from 2024 onwards. This again does not apply to private tenants.

Criticism

Aedes, VNG and the Woonbond criticize the new plans. They find the effects of the transformation of the housing allowance in the longer term still unclear. The organizations fear that the group that receives less housing allowance is much larger than the more than 290,000 people mentioned by the cabinet, because new tenants and people who move have not been included.

The new law is due to take effect in 2024, with a transitional period of five years. This way, tenants can get used to the new surcharge amounts. The Senate and House of Representatives have yet to agree to this proposal.