Daniel Blake Operations Manager South e: daniel_blake@shelter.org.uk t: @danielblake68

Shelter’s work We provide support to people facing housing and homelessness issues across the country, through face-to-face services, digital advice, and our helpline – Hub Centres in major cities We campaign to strengthen the housing safety net, improve the private rented sector, and get more affordable homes built KEEP, ACCESS, IMPROVE – Focus on prevention 50th Year – How Much has changed?

What’s happening?

Affordability crisis Average house prices in England and Wales are now almost nine times average earnings. Private renters spend almost half of their take home pay on rent Housing benefit decoupled from PRS market ‘Pay to Stay’ proposals could see market rents introduced in the social sector for households earning over set thresholds

Overview of the housing crisis Average house prices in England and Wales are now almost nine times average earnings. The number of priority need households accepted as homeless in the last year was 40 per cent higher than five years ago Almost 70,000 households are currently homeless and living in temporary accommodation in England Over 100,000 children without a home 1.24 million households were on social housing waiting lists last year

Scale of the problem

Welfare and Family Reform

The key issues Research conducted by Shelter shows that reforms to Local Housing Allowance and the Benefit Cap will make significant parts of the country unaffordable to low income families in receipt of housing benefit. This won’t just effect large families in London and the South East, but families with one or two children across many parts of the country. Cuts to housing support for 18-21s and a cap on housing benefit in the social rented sector will be disastrous for young people and the provision of supported accommodation. As a new wave of welfare reforms comes online – at a time when the supply of social housing is contracting and private renting is becoming more and more expensive – things are only going to get worse for low income households. We know from the majority of councils that existing welfare reforms have already contributed to the steady increase in homelessness across England.

Freeze to Local Housing Allowance Shelter’s key ask: The government should review the four year freeze to housing benefit in the private rented sector to ensure that this keeps up with market rents. A targeted affordability fund should be made available in areas where rents are especially high – for example London and parts of the South East. The Chancellor announced in the 2015 Summer Budget that LHA rates will be frozen for four years – twice the two year freeze promised in the Conservative manifesto. Local Housing Allowance rates set the maximum amount of support that private renters can receive towards their housing costs. The system was one of the big losers in the 2010 Emergency Budget, when rates were re-pegged from median local rents (meaning families on housing benefits could afford half the homes in their local area) to the bottom 30th percentile – meaning only three in ten homes in an area are affordable. It was a big chunk of support for families to lose overnight but we always warned the real risk would be felt down the line. In 2012 the link between LHA rates and local rents was broken entirely – meaning housing benefit no longer increased as rents rose. Instead LHA rates were up-rated by CPI inflation from April 2013; an arbitrary measure that meant the safety net became unresponsive to rising rents and localised pressures.

Lowering the Benefit Cap Shelter’s key ask: Statutory homeless households – typically families- living in temporary accommodation should be exempted from the benefit cap. To avoid the most harmful impacts, key groups should be exempted from the policy, for example: those excluded or estranged from their family; those experiencing, or recently experienced homelessness; those with dependents. The benefit cap restricts the amount of benefits that families who aren’t working can claim. Currently, a family not eligible for Working Tax Credits can claim a maximum of £26,000 a year in benefits. The Bill will slash this total to just £20,000 for families outside of London and to £23,000 a year for families in London. We have a keen interest in the benefit cap. Housing benefit is included in the cap and is cut to ensure that households do not breach the limit. Although housing costs vary widely across the country – a challenge the housing benefit system itself deals with admirably – the benefit cap imposes a crude limit that applies from Teesside to Torquay.  The high cost of housing across much of the country is the reason that many families find themselves affected by the cap.  An unworkable benefit cap can have a major and crude impact on a low income family’s ability to afford their home.

18-21s Shelter’s key ask: We urgently need to see a better understanding of the impact of this policy, in particular on key groups, such as young people and homeless people living in supported housing. The government must publish a full impact assessment so the full scale of this policy can be understand. Politicians are proposing a new form of social security for unemployed 18-21 year olds, which means they are likely lose their entitlement to housing benefit. Shelter is concerned that removing young people’s access to housing benefit will lead to an increase in youth homelessness. These changes come in a context of high youth unemployment, where young people aged 18-24 are almost three times as likely to be unemployed than the general population.1 There is evidence that, with the right kinds of support, young people will find their way into work; 85% of young people on Jobseeker’s Allowance find a job within twelve months.   However, removal of housing benefit would put this at risk, and it would become much harder for those affected to find a stable home and rebuild their lives. Capping housing benefit in the social rented sector 1% social rent cut.

Housing Benefit cap in the social rented sector Shelter key ask (same as with 18-21s): We urgently need to see a better understanding of the impact of this policy, in particular on key groups, such as young people and homeless people living in supported housing. The government must publish a full impact assessment so the full scale of this policy can be understand. In the Autumn Statement the Chancellor announced that the LHA limits will be applied to social renters from 2018, covering all tenancies signed from April 2016. The move means that no social tenant will be able to claim more than they would be entitled to if renting from a private landlord locally. Because private rents are on average twice as expensive as social rents, the majority of social tenants will be unaffected by this move. But there are exceptions, and those social tenants that live in supported housing are set to be hit badly. The biggest impacts will be seen among: people under the age of 35, who will only be eligible for the ‘shared accommodation rate’ on housing benefit; social renters in areas where private rents are low; supported housing provision; new social renters of pension age.

How can we fix it?

More affordable homes Supply is currently nowhere near meeting demand We need more and better new homes We need to get both the private and the public sector building in order to achieve the scale of delivery we need Products like Starter Homes must run alongside, not instead of building more affordable homes.

Changes to homelessness Improved practice from councils: Out of area placements are increasing – practice is mixed Support for non-priority clients Handling of intentionally homeless cases Greater emphasis on homeless prevention Not just funding, but culture change. Although supply is the challenge Changes to homeless legislation Changes in Wales are generally positive, but some concerns.