London Councils has warned government plans to reform the welfare system could be driving rents up in the capital.

The Tackling Welfare Reform report says some London boroughs have seen rents rise by more than 20% over recent months and low-income families are being hit disproportionately by changes to housing benefits.

According to the report, more than two thirds of the growth in housing benefit receipts are from the private rented sector.

The report calls for the welfare system to take the higher living costs in London into account and for a full assessment of the financial burdens being created for local authorities under the reforms.

‘Councils want to support families, but the double whammy of the scale of welfare changes alongside cuts to council budgets make this a massive challenge,' said London Councils chair, mayor Jules Pipe.

‘The report shows that to avoid creating a chaotic system where the only beneficiaries are landlords and letting agents, the Government must ensure its reforms reflect London's housing crisis.'