Councils are cutting off housing benefit payments to tenants who are entitled to receive them, as an unintended consequence of sanctions applied to other benefits.

Jobseeker’s allowance and employment support allowance claimants can have sanctions applied to their claims if they miss appointments or fail to do enough to find work. But many are also having their housing benefit cut, because they are unaware that they need to tell councils their financial circumstances have changed. Local authorities are stopping claims as a result.

Charities warn they are dealing with a rising number of housing benefit problems as the number of JSA and ESA sanctions soar - because many recipients don’t realise the reductions could affect their claim.

The number of sanctions against benefit claimants deemed not to be doing enough to find work increased to 860,000 in the year to June 2013, the highest for any 12-month period since statistics began to be recorded in their present form.

Housing associations have also reported anecdotal evidence of tenants falling into rent arrears as a consequence of housing benefit being cut off the back of another sanction.

Homelessness charities, including umbrella body Homeless Link and Crisis, have raised the problem with the Department for Work and Pensions. They are feeding into a review of the way sanctions are communicated, being carried out for the DWP by Matthew Oakley, a former economist at think tank Policy Exchange.

Katharine Sacks-Jones, head of policy and campaigns at Crisis, said: ‘People are not being advised that their housing benefit will be affected and that they may need to re-apply for it. Often they only realise there’s a problem when they are in arrears or facing eviction.

‘There needs to be clear communication between the different [council] benefit departments to prevent people’s housing benefit being affected by sanctions [applied elsewhere].’

In its evidence to the Oakley review, Homeless Link called on the DWP to ensure the potential impact of a sanction on a claimant’s housing benefit is explained - and how a claimant can avoid this happening.

A spokesperson for Circle Housing Group confirmed it was starting to hear ‘anecdotal’ evidence of problems as a result of sanctions being robustly applied.

A second association, that did not wish to be identified, confirmed it had seen similar problems.

A DWP spokesperson said that sanctions should not affect claimants’ housing benefit.