Housing Benefit has traditionally played an important role in preventing homelessness. It has saved people from losing their homes during a period of illness or unemployment.
However, we are concerned that government reforms to Housing Benefit are weakening this safety net. Many of these reforms haven’t taken into account what accommodation is available and how much it costs. This means that in many parts of the country, Housing Benefit no longer covers the cost of renting. This is having a significant impact on homelessness.
Over the next few years housing benefit will gradually be replaced by the government’s new benefit system, Universal Credit. In Scotland the government has gained some powers over housing costs paid through Universal Credit.
What needs to change
Across Great Britain we are calling on the government to:
- Reconsider how they calculate Housing Benefit for people renting from private landlords so it covers people’s rent in all parts of the country. Read more about Local Housing Allowance.
- Make more shared accommodation available or rethink the rules about how much Housing Benefit under 35 year olds can get. Read more about the Shared Accommodation Rate.
- Look at the impact of the benefit cap on homelessness.Read more about the benefit cap.
- Reduce the long delay before people receive their first Universal Credit payment. Read more about Universal Credit.
In England and Wales we are calling on the government to:
- Do more to protect 18 to 21 year olds from becoming homeless as a result of new benefit rules. Read more about 18 to 21 year olds.
- Make it easier for people to have their rent paid directly to their landlord under Universal Credit. Read more about Universal Credit.
Local Housing Allowance
Local Housing Allowance is Housing Benefit paid to people who rent from private landlords.
In recent years the government has changed the way it calculates Local Housing Allowance, meaning it is no longer set in relation to actual market rents. This has included freezing Local Housing Allowance rates at their current level until 2020. Rents are rising in many parts of the country. This means more and more people now have a shortfall to pay or are unable to find a home to rent that they can afford.
We are calling on the government to reconsider how they calculate Local Housing Allowance so that it covers people’s rent in all parts of the country. We collect evidence, published in the Homelessness Monitor, on the impact of Housing Benefit reform on homelessness and work with MPs and peers to raise these issues in parliament.
Shared Accommodation Rate
The Shared Accommodation Rate is the lowest level of Housing Benefit for people who rent from private landlords. It is intended to cover the cost of a room in a shared property.
Changes to Housing Benefit rules mean that more people are restricted to this very low rate. In 2012 the government increased the upper age limit from 24 to 34. This puts pressure on a very limited supply of affordable shared properties. As a result, homelessness services across the country are finding it difficult to house homeless people under 35.
From 2019, single people under 35 who live in social housing will also have their Housing Benefit capped at the Shared Accommodation Rate. We are concerned this will put people under 35 at increased risk of homelessness. We are calling on the government to make more shared accommodation available or to rethink the rules.
Our Sharing Solutions programme has funded projects which support people in shared accommodation rented from private landlords. We support local authorities and housing associations with practical advice on how they can support shared tenancies. Visit our Housing Centre for more information.
18 to 21 year olds
As of April 2017, 18 to 21 year olds are no longer automatically entitled to support through the benefit system to cover their housing costs. The government expects young people who are out of work and claiming Universal Credit to live with their parents. Some young people who can’t live at home will be protected but we have serious concerns that others could become homeless.
Along with other homelessness charities, we are calling on the government to do more to protect young people from becoming homeless as a result of this measure.
The Scottish government has said it will make sure that young people in Scotland continue to get support with housing costs. We are talking to them about how they can do this.
Briefings and research:
- Joint briefing Universal Credit (Housing Costs Element for claimants aged 18 to 21 (Amendment) Regulations 2016) (Word) - February 2017
- Support for housing costs for young people (PDF) - 2015
- The withdrawal of support for housing costs under Universal Credit for young people: more pain for little gain? - 2015
The benefit cap limits the overall amount that people can claim if they’re unemployed by reducing their Housing Benefit. In 2016 it was reduced further therefore affecting smaller households (including single people) and more people outside London. Given that it will affect more people, we are concerned the cap will have a greater impact on homelessness. We will be monitoring the impact of the cap, including through the Homelessness Monitor. We want the government to do the same, and to rethink the policy if it leads to increased homelessness.
We want the government to do the same, and to rethink the policy if it leads to increased homelessness. People should get help to find cheaper accommodation or a job, not just have their benefits taken away.
By 2022, Housing Benefit will be rolled into Universal Credit. This is happening gradually. Some people are already receiving it. People will receive all their benefits in one monthly payment, including the payment intended to cover their rent. We support the government’s aim of simplifying the benefits system through Universal Credit. But we are concerned that some people might get behind on their rent.
In England and Wales we are calling on the government to make it easier for people to have their rent paid directly to their landlord.
In Scotland the government has agreed with us that it should be possible for rent to be paid directly to landlords. They are changing the law to make this happen.
We are also calling on the UK government to reduce the long delay before people receive their first payment.
Read more about our work on Universal Credit.