Nope you have not missed anything...
LHA's should not have an impact until RSL's have completed 'rent restructure' and that is not until 2010...
The policy intent of the DWP has always been to impliment LHA payments in the private rented sector, and make sure it is running smoothly well before turning to the position of RSL's (which would by extension affect Local Authority housing stock (such as it is, and such as it will be by 2010).
Of course, all this is dependent on the outcome of the next election... Before the 1997 General Election, regs had already been laid and guidance issued to Local authorities on the restriction of all rents of single people under 60 years old (in the private rented sector), to the Single Room Rent level...
As the primary legislation is so weak, the HB scheme can be amended at almost any time, and in any shape and having any result as the Secretary of State might choose...
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