I beg to move,
That this House has considered local housing allowance rates for homeless young people.
It is a pleasure to serve under your chairship, Mr Hollobone.
Clearly, we have a severe homelessness crisis. The number of people sleeping rough on the streets of England has increased by a huge 165% since 2010, and 103,000 young people were homeless or at risk in 2017-18. In my own city of Brighton and Hove, the scandal and tragedy of homelessness is acute. Vulnerable young people are being let down, left to sleep on sofas, in hostels and on our pavements, cold, frightened and desperately unsafe.
The Minister himself has said, in answers to questions in the House, that the causes of homelessness are numerous, varied and complex. He is right. In the short time we have today, I will address the specific problems caused to vulnerable young people by the significant gap between the cost of renting in the private sector and the local housing allowance rates provided to the young people who need support.
Private renting is expensive, but because there is not enough social housing, young people are forced into the private rented sector as the only alternative to homelessness. The House of Commons Library points to evidence that in many areas, especially areas of high housing demand such as Brighton and Hove, there is a growing gap between the lowest private rents and the amount of local housing allowance. Young people in Brighton and Hove have a particularly hard time because the amount of LHA is calculated by lumping our city in with other towns in the locality where the cost of housing is much lower. The amount of housing support is therefore artificially depressed, leaving young people in an even more desperate position.
Research by the Chartered Institute of Housing illustrates the dire situation for young people. In Brighton and Hove, 30% of properties should be available at or below the LHA rate, yet LHA is so much lower than local rents that only 10% of shared properties and only 5% of one-bedroom properties are affordable. Evidence is also provided by the National Audit Office, which in 2017 concluded that housing benefit changes were contributing to an increase in homelessness.
As hon. Members know, the Government have taken some action. This April, there will be a one-off, 1.7% increase in LHA rates. That sounds positive until we look at what that means for the figures. In Brighton, young people will receive only £5 extra a month. That is a kick in the teeth for homeless young people who are already more than £140 a month short of the average rent for a room in a shared house, as I will explain. Furthermore, because the increase is a percentage, it locks in the freeze of the past four years.
To illustrate the point, the charity Centrepoint analysed the new LHA rates for 2020-21 alongside the average rental costs for the 247 local authorities where rental data are available. It found that, from April, a room in a shared house would be affordable only in three of those 247 local authority areas for those in receipt of the shared accommodation rate. Rightly and urgently, homelessness charities are calling for the local housing allowance, including the shared accommodation rate, to be set at the 30th percentile of local rents, as it was until 2012. I hope that the Minister will push the Treasury for the restoration of that link to rents.
My more specific purpose in securing today’s debate, however, is to urge the Minister to champion two other actions that will cost the Treasury relatively little, but will have a massive impact on two groups of extremely vulnerable young people. The first group to need the Minister’s help is homeless young people under the age of 25 who are ready to move on, but who are trapped in hostels because they cannot find anywhere to rent on the shared accommodation rate. In effect, therefore, they are left locked into emergency accommodation, unable to find a safe place to live and unable to move on. Moreover, in the process, they prevent those in urgent need from finding shelter at the emergency accommodation.
Young people under the age of 25 make up fully 44% of those living in supported accommodation. They end up trapped in hostels, because our welfare system is rife with age discrimination. If I am over the age of 25 and previously spent three months in a hostel, I will be given a higher local housing allowance to help me find a place to live, but if I am under 25 and in exactly the same situation, I still receive the lowest rate. Young people entering a homeless hostel at the age of 18, therefore, will have to wait as long as seven years before they benefit from the rate that would help them to move forward.
Why have the Government turned their back on vulnerable young people who so clearly need support to find a home? Young people experiencing homelessness cannot rely on the bank of mum and dad and cannot move back into the family home to save up, yet they receive the lowest minimum wage and the lowest benefit rate.
In 2018, the charity Depaul UK looked at the shared rooms available in 40 local authority areas in England where official statistics showed that a total of 225 young people were sleeping rough on a single night. Across those 40 areas, only 57 rooms were found to be available for young people at or below the shared accommodation rate. Nine of those 225 young people sleeping rough were in Brighton and Hove, but the research found literally no rooms in our city that were available within the shared accommodation rate for young people claiming benefits.
In Brighton and Hove, the shared accommodation rate for homeless young people is just £360 per month. If we search on Rightmove for shared rooms for that amount, I promise that all we get coming up on the website are parking spaces or garages. That is shameful. The average rent of a room in a shared house is £507 a month. That is a shortfall of more than £141 a month, leaving homeless under-25s unable to move out of a hostel and find somewhere safe to live. In the Prime Minister’s local authority, from April 2020 the monthly shortfall will be more than £236 a month. In the Minister’s own area of Colchester, the shortfall, as I am sure he knows, will be £153 for a homeless young person.
The Minister may ask why young homeless people need the exemption from the shared accommodation rate when the Government have introduced some measures intended to mitigate the impacts of LHA restrictions. For example, in answer to a recent written question, the Minister replied:
“For individuals who may require more support and whose circumstances may make it difficult for them to share accommodation, Discretionary Housing Payments are available.”
I urge the Minister, however, to consider the fact that discretionary housing payments, or DHPs, are not a sustainable solution. They are supposed to be a temporary measure until a household finds more affordable accommodation. Yet for homeless young people, affordable accommodation simply does not exist, due to the reduced rate of housing benefit that they receive.
Moreover, in order to access DHPs, young people need to approach their council or MP for support in applying, and many homeless young people at crisis point may simply not have the know-how or capacity to do that. Furthermore, the state already has the information needed to make a fair decision on providing extra support without forcing someone in that position to apply for discretionary and temporary help—the information is that being homeless and living in a hostel for three months is, in itself, qualification enough for needing more support, whatever age someone is.
Centrepoint, which works daily with young people aged 16 to 24 in that position, estimates that it would cost just £3.68 million a year for the Treasury to exempt such young people from the shared accommodation rate, giving them the higher one-bedroom rate and a chance to move on. That does not even take account of the savings that would accrue from providing stability—the cost of emergency accommodation is high, as is the cost to the state and the young person of the consequences of homelessness.
I appreciate that Ministers accept the logic of providing an exemption to the SAR to people in need, because they are able to find such funding for over-25s who are experiencing homelessness. All I am asking for today is that they will find it in their hearts and budgets to help younger homeless people too.
My second specific ask of the Minister relates to that group of young people who have left care. Care leavers deserve somewhere safe to call home. Many have experienced unspeakable trauma, and surely that is the least we can provide. Again, it is shocking that the local housing allowance received by care leavers drops on their 22nd birthday, putting them at risk of eviction and homelessness. When I say “drops”, I mean it literally plummets. In Brighton and Hove, there are about 300 care leavers aged between 17 and 21. On a care leaver’s 22nd birthday, what does the state do? It takes away £330 a month. In the Prime Minister’s area, a care leaver surviving in the private sector loses a whopping £437 a month. What a birthday gift to vulnerable young people who are on their own, having faced unimaginable trauma and difficulty.
The Government’s rationale for creating such instability, difficulty and risk for 22-year-old care leavers is not at all clear. Perhaps the Minister will explain. The policy seems strongly at odds with previous Government statements. For example, in 2016, the Government rightly accepted the moral obligation to provide care leavers with the support they need, stating:
“The government is passionate about improving the lives and life chances of care leavers. Young people leaving care constitute one of the most vulnerable groups in our society, and both government and wider society have a moral obligation to give them the support they need as they make the transition to adulthood and independent living.”
I could not agree more, and I urge the Minister simply to extend that understanding until a care leaver is 25.
Homelessness charities estimate that the number of care leavers aged 22 to 24 affected by the reduction in housing support is relatively small. The cost of extending their exemption from the low shared accommodation rate until the age of 25 would be in the region of £6 million. As with the previous ask for hostel leavers, it would save the Government money overall by reducing homelessness, distress and all the personal and financial costs associated with crisis management.
To try to demonstrate the genuine need for support for care leavers until the age of 25, I would like to tell the Minister about a case from my local area. A girl in both foster care and residential care was placed with foster carers from the age of 14; as a result, she built a solid relationship with the family she was finally placed with. She has learning difficulties, so any changes to her environment or living circumstances are destabilising. To her great credit, she found a job and established a good routine in the local area, and she maintained a tenancy on a bedsit. She was able to cover the rent between the LHA one-bed rate and her weekly wage. Since turning 22, she is in receipt of the lower shared room rate of local housing allowance. That means she does not have enough to cover the cost of rent each week from earnings and benefits. She is now at risk of homelessness.
It would cost just £3.7 million a year to give vulnerable homeless young people the chance to move on, and just £6 million to continue supporting care leavers with their housing costs until they are 25. That support would save the state money overall, because stable, supported young people could fulfil their potential rather than suffer in chaos and danger. Less than £10 million to make such a huge difference to young people’s lives is not a lot to ask. Will the Minister urgently meet with the homelessness charities and MPs to work on these specific asks ahead of the Budget—the critical moment? Will he use his influence with the Chancellor to provide that relatively small amount that would make a huge difference to young people in my constituency and right across the country?