Charedi leaders are fearful of the impact of the government's proposal for a £400 a week cap on housing benefit for rented homes with four bedrooms or more.
A Hackney Council report on the proposal concludes: "Ethnicity analysis of local housing allowance [LHA] claimants who will be adversely affected by the cap proposal clearly shows that the Charedi community will be the most severely affected."
The report noted that, 18 months ago, LHA levels were typically £550 for a five-bedroom property. The LHA is the amount Hackney pays towards the rent of people claiming benefit. If the rent is more, the tenant is responsible for the balance.
"It's the talk of the whole area," said Michoel Posen of Agudas Israel Community Services in Stamford Hill. "Everyone is very worried." If the proposal was adopted, some families would move out of the area, most probably to Manchester, where rents are cheaper.
"Some people will have to downsize and cram more children into the same room. Others will drag it out and then throw themselves on charity. This will discriminate against large families."
London Jewish Forum chief executive Alex Goldberg also expressed concern about the benefit cap.
"People on low incomes in the general community in Hackney are in social housing," he explained. "About 70 per cent of the Charedi community is in private rented accommodation paid for through housing benefit. There was a theory that they were in social housing in the '60s and '70s but were chased off and never went back. So the pattern has built up over decades.
"There must be a way of creating a situation where we have affordable housing for families that have been here for generations and this applies to other ethnic groups in London."
Both London Mayor Boris Johnson and Hackney Mayor Jules Pipe are pressing the government to change the policy, which is set to become law in April.