The Autumn Statement is a month away and is our opportunity to highlight the needs of people experiencing homelessness, and the sector to the Treasury. As part of our Keep Our Doors Open campaign we have continued to ask for increased support for the sector to help with financial pressures due to rise in inflation, and the impact of increased energy costs.
But we also know the pressure that increased demand for services is causing as we see a rise in people becoming homeless. As rents in England continue to rise, many of these people are pushed to our doors from the Private Rental Sector. This is why our submission also calls on Government to support low-income renters to avoid homelessness. Along with other members of the Cover the Cost Coalition, we are calling on Treasury to uplift the Local Housing Allowance (LHA) and prevent homelessness for thousands who rent privately across the country.
In the absence of sufficient social housing, more and more people are forced to turn to the private rental sector for a roof over their heads. LHA, the benefit which is supposed to support private tenants, should cover the cheapest 30% of the market to ensure everyone has access to a home. But instead, LHA remains frozen at 2020/21 levels. Average rents in England increased by 5.5% in the last year, the biggest increase since records began. For many of the low income renters whose benefit levels have fallen behind their rent, homelessness is both traumatic and totally preventable.
For many, the situation has reached breaking point. Analysis from the IFS shows just 5% of new rental properties in England are covered by LHA. In bigger cities it is already worse meaning that, for many people, there are simply no homes left in the Private Rental Sector that they can afford.
Homelessness is a devastating experience. Allowing it to grow for avoidable reasons would be a national disgrace. People who cannot be accommodated in the private sector have no choice but to turn to the homelessness system. And the same benefit shortfalls also prevent people from moving on, with around 40% of residents in homelessness accommodation unable to find permanent housing in an unaffordable market. Temporary accommodation rates have also reached record highs with 104,510 households including over 130,000 children trapped in short term, unsuitable housing at a cost of £1.7 billion to local authorities.
Allowing such avoidable homelessness is cruel and shortsighted. At a time when services are already struggling to match demand and councils face bankruptcy due to unsustainable temporary accommodation bills, we should be doing everything possible to keep people in their homes and where they are already experiencing homelessness help them move into secure, permanent housing as quickly as possible. Chancellor Jeremy Hunt has previously committed to ‘protect the most vulnerable’ through the cost of living crisis. But as the cost of renting continues to spiral, failure to uplift LHA will instead push more and more people onto our streets and trap them in unsuitable, expensive temporary accommodation.
So, with a month to go until the Autumn Statement, we join with the sector to ask the Treasury: uplift the Local Housing Allowance. Doing so is the single greatest action you can take to support people at risk of homelessness in England.