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John Perry @_ John Perry is Policy Adviser to the Chartered Institute of Housing and an editor of the annual UK Housing Review.

Still not tackling the causes of homelessness

The regular Homelessness Monitors published by Crisis for each of the four countries of the UK have helped marshal the evidence and focus attention on a persistent problem which rational minds would have thought had been solved in the UK well before this century began. Unfortunately, not only is this not the case but in England, at least, things are getting worse month by month.

As the latest Monitor shows, this in great part is due to the ending of private sector tenancies, the biggest growth factor in homelessness cases. This in itself is a reflection of the greater use low-income families are forced to make of the private sector, and of the churn in the sector caused by rising rents and house prices, and ever-changing rules about benefit entitlements and benefit levels. In addition, low-income families who are in work are likely to be in low-paid, insecure jobs, which jeopardise their holding onto a tenancy.

Benefit changes such as the ‘shared accommodation rate’ (which makes it difficult for people under 35 to find a letting at an affordable rent) have forced people out of the sector. And private landlords are less likely to be tolerant of periods in which tenants can’t pay their rent and more likely to evict them. Where this happens, they naturally present themselves as homeless to their local council.

Councils are facing unprecedented pressures with diminishing resources to deal with them. For example, over the last twenty years the numbers of lettings they can make annually has fallen by 70%. As the CIH’s latest UK Housing Review will show, not only has the number of lettings fallen but the proportion going to homeless households is down to 23% compared with 34% in 1995/96.

And while the government has committed to maintaining the Homelessness Prevention Grant which helps councils maintain their prevention services, at the same time the sector’s capacity to house homeless people, especially those needing extra support from the voluntary sector (such as those experiencing domestic violence), is being badly eroded.

Perhaps the most worrying development is that the coalition’s welfare reforms, which are only now beginning to show their full effects, are to be quickly followed by a raft of other measures, including a massive overhaul of the system through the introduction of universal credit.

It’s not surprising that social landlords feel as if they are being shifted unstoppably into unknown territory. The mix of new reforms will include direct payments of universal credit to tenants (instead of landlords), the cuts in entitlement that were only postponed by the Chancellor when he halted the changes in tax credits (but not in universal credit) in the Autumn Statement, the freezing of benefit levels from 2016/17, and the limiting of support for families with three or more children to the rates for those with only two children.

Supported housing may be particularly affected if a proposed 1% rent cut in the social sector applies to it and if it is also subject to another of the new welfare reform measures, the limiting of HB payments for rents in the social sector to the maximum levels that apply in the private sector through local housing allowances. Because of staffing costs, supported housing, including schemes directed at previously homeless households, is particularly vulnerable to such cuts in income. If support services are withdrawn, more people will inevitably end up on the streets.

It is hardly surprising that almost three-quarters of councils surveyed for the Crisis report considered that the roll-out of universal credit, which brings together a range of means-tested benefits including housing benefit, will increase homelessness. It is also interesting that a majority of councils would welcome a review of homelessness legislation to formalise and lengthen the period in which they are obliged to offer help to prevent homelessness.

This is modelled on recent Welsh legislation, which is itself in the early stages of implementation. It is probably a reflection of local authorities’ realism in accepting that lettings from their own stock for homeless households are going to be in increasingly short supply, and that a changed approach and greater use of the private rented sector are the only practical alternatives.

But it remains the case that only long-term answer to rising homelessness is to build more homes for letting at genuinely affordable rents. Unfortunately, here too, investment is being shifted away from building rented housing and towards promoting homeownership. The homeless and potentially homeless are caught in a many-sided and tightening trap – rising rents, tighter controls on their access to benefits, cuts in homelessness support, and reduced access to housing with rents they can afford. It seems unlikely that the next Homelessness Monitor will have better news than this one.