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Welfare and housing policies blamed for rise in homelessness

Crisis’s most recent Homelessness Monitor 2019 for England highlights concerns that housing and welfare policies are increasingly leading to homelessness. 

Respondents believe rise in homelessness attributable to housing and welfare policies

Setting the context for the rise in homelessness and for the increasing need for temporary accommodation, the report highlights that the number of social lets in England continues to decline as a result of the long-term impact of ‘right to buy’ and inadequate levels of new build social housing and charts the reaction of key stakeholders to this decline. The report states that 18,000 fewer social lets were made to homeless households in 2017/18 than in 2007/08 despite statutory homelessness having risen substantially over that period.

By mid-2018 some 85,000 homeless households were living in temporary accommodation, equating to over 200,000 people. Respondents to the research which informed the report believe that housing and welfare policies affecting low-income households have a far more profound impact on homelessness trends than the general economic climate. The report notes that the UK government does not necessarily accept this characterisation of the causation of rising homelessness in England, especially the link made with welfare reform and commissioned research to develop a suite of quantitative, predictive models of homelessness.

Affordability checks by social landlords restricting access to social housing

Respondents commented that social landlords’ allocation policies were often the source of problems for those who needed to access social housing, with one respondent suggesting that housing associations were generally squeezing out higher risk and non-economically active households, showing a preference instead for working households. Some of the respondents to the research expressed concern at housing association practices such as requiring deposits and rent in advance and/or excluding benefit-reliant households with refusals made on the grounds of affordability issues.  The report notes that financial capability checks are regularly used to determine the level of affordability for tenants in order to ensure the sustainability of the tenancy.

The revelation that housing associations are routinely excluding the poorest tenants in these ways, has resulted in councils throughout England becoming concerned that such policies are actively undermining their attempts to house homeless people. Furthermore, there was a general concern among respondents that because of lack of government support, housing associations could be driven to seek profit, rather than adhering to social values.

Impact of the Homelessness Reduction Act

A major focus of the report is on reactions to the recent homelessness legislation in England (The Homelessness Reduction Act 2017), which focuses on prevention of homelessness. The report notes that under the new legislation, people are initially recorded as seeking assistance rather than as homeless, with subsequent interventions recorded as ‘prevention of homelessness’. Currently the statistics are ‘experimental’ and there is only one quarter’s worth of recorded data.

The most striking homelessness prevention ‘growth activity’ has involved debt advice and financial assistance, amounting to 60,000 prevention instances in 2017/18 compared to only 16,000 in 2009/10 – which would seem highly consistent with the impacts of ‘welfare reform’ on those in precarious housing circumstances.  The report states that welfare reforms are highly relevant to homelessness trends, particularly those which relate to the provision of support for low income households in the private rented sector, namely the Local Housing Allowance (LHA) reforms (including the Shared Accommodation Rate).

Rise in homelessness linked to continuing affordability problems for private tenants

The report makes the connection between the reduction of LHA rates since their introduction in 2008 and the rise of homelessness presentations as a result of the inability to sustain private tenancies. As a consequence of the reductions in LHA there has been a growing gap between the actual rents experienced by PRS tenants and the amount which is covered by LHA. This gap has to be paid by tenants, often out of other benefits, and is implicated in the rise of evictions due to loss of private tenancies.

Universal Credit difficulties compounding existing affordability issues

Affordability problems are shown to be further impacted by the roll-out of Universal Credit (UC), with increases in financial hardship including rent arrears and the subsequent increase in court actions and against those tenants who are unable to sustain their rental payments as a result of problems with UC. Recent figures released as a response to a Parliamentary question revealed that over half of all UC claimants had some of their benefits deducted at source by DWP in order to pay off debts to utility companies or landlords in October 2018.  These debt recovery practices have been described as uncoordinated and have been cited as one route into destitution. The report highlights that the UN Rapporteur on extreme poverty and human rights stated ‘No single programme embodies the combination of the benefits reforms and the promotion of austerity programmes more than Universal Credit. Although in its initial conception it represented a potentially major improvement to the system, it is fast falling into Universal Discredit’.

Increase in temporary accommodation placements

Crisis's report also notes that temporary accommodation placements for homeless households continue to rise and now stand 71% higher than they did in 2011.  The authors found a disproportionate rise in the usage of bed & breakfast type placements to temporarily house homeless households. This type of placement is often regarded as unsuitable and the Scottish Government has restricted the amount of time that a homeless person can spend in this type of temporary accommodation to 7 days. This increasing usage of unsuitable temporary accommodation arrangements points to a shrinkage in the resources available to councils to effectively accommodate homeless persons. 

This comprehensive review of homelessness statistics and government policies which impact on homelessness is sobering reading, particularly as it relates to the cost of renting in the private rented sector for benefit claimants and in terms of the barriers to accessing social housing via housing associations.  A comparable report covering Northern Ireland is due to be published later this year.

Tagged In

Benefits, Outside NI, Homelessness