A budget to end homelessness

Tuesday, 23 October 2018 - 12:43pm

With years of reduced spending on housing-related support and increasing gaps between income and rents, now is the time for Government to invest in tackling the structural causes of homelessness.

House made of notes and coins

The extent of homelessness across England is a national crisis. The past three years have seen the number of people sleeping rough in England increase by 73% and is predicted to rise by 76% in the next decade. Shelter has calculated that in England 268,330 people are either rough sleeping, single people in hostels, households owed the statutory duty by a local authority or homeless households being accommodated by social services. Since December 2010, the number of households in expensive temporary accommodation alone has increased by 66%.

There has no doubt been many positive moves to address the crisis this year. The Homelessness Reduction Act, which came into force in April, provides a new legislative framework for local authorities to refocus their work on preventing homelessness. In August, the Government made the welcome announcement to maintain Housing Benefit for all supported housing and set out its plan to make good on its commitment to halve rough sleeping by 2022 and end it by 2027 in the Rough Sleeping Strategy, including new funding commitments for dedicated outreach teams and for emergency bed spaces.

However, to truly end homelessness, the Budget will need to address three key structural problems:

1.   Shortage of low-cost housing

"The demand for housing services and homeless services has increased throughout the age range as options are so slim, more and more are struggling to afford a home to live in." (Local authority respondent). Young and Homeless 2018

The lack of truly affordable housing, i.e. housing at submarket rents, currently both contributes to homelessness and causes significant challenges for individuals looking to move on from homelessness - 73% of respondents in our Annual Review of Single Homelessness Support in England  identified the lack of affordable housing as preventing people from moving on from their services.

This is driven by a lack of available social housing, barriers to accessing the private rented sector (including a shortage of one bedroom properties and few incentives for private landlords to let to people claiming benefits), and an ever-increasing gap across most of England between people’s incomes and the rents in their areas as a result of the freezing of the Local Housing Allowance, currently projected to continue this year.

To end homelessness, the Budget should make commitments to increase the supply of truly affordable housing, reverse the freeze on the Local Housing Allowance and review levels so that they reflect the reality of the local rental market.

2.   A broken safety net

Universal Credit has been rolled out across England with an aim to simplify the benefits system and to help more people move into and progress in work while supporting the most vulnerable. However, our members and people with lived experience of homelessness have consistently highlighted that Universal Credit is not currently meeting its aims for people experiencing homelessness, leading in some cases instead to serious hardship.

Members have told us of people regularly waiting around 7-8 weeks to receive payment due to errors within the operation of Universal Credit and the requirements placed on people throughout the process of making a new claim. With no other financial resources, people are steered to take out Advance Payments, but the high repayment rates of these, applied on top of other existing deductions, makes managing outgoings impossible.

To end homelessness, the Budget should invest in the aims of Universal Credit, offering greater levels of legacy benefit run-ons in addition to the current two weeks of Housing Benefit, and reduce the total level of deductions that can be made from an award to ensure people can manage outgoings. Further, Universal Credit rollout, including both natural and managed migration, should be paused until identified issues faced by people with a history of homelessness in making and managing a Universal Credit claim are fully addressed.

3.   Reduced funding of high-quality support

Recent years have seen significant cuts to housing-related support funding. 39% of homelessness accommodation projects reported a decrease in funding in the past year, with members reporting that further reductions will place the existence of some services in jeopardy.

Homelessness and housing-related support services deliver cost savings across public service budgets as well as better outcomes for vulnerable people. Services enable people to live more independently, preventing the need for more costly residential services and improving outcomes for people in areas such as health, wellbeing and employment. The most comprehensive evaluation of Supporting People found that a £1.6 billion investment generated net savings of £3.4 billion to the public purse. This included avoiding £315.2 million health costs, £413.6 million costs of crime and criminal justice and £96 million costs of homelessness. Further, there is a significant body of evidence that a Housing First approach has proven extremely effective in generating savings and delivering outcomes for people with multiple and complex needs.

To create a truly sustainable homelessness sector, this Budget should provide assurances about levels of support funding to meet current and future need, including revenue funding for support elements of Housing First schemes.

This Budget offers an opportunity for Government to tackle the causes of homelessness, making spending previously committed far more efficient and improving outcomes for people who do experience homelessness. Read our full submission with further recommendations.