Concern over housing benefit plan after pilot reveals rise in homeless

The government is to press ahead with its overhaul of the housing
benefit system, despite indications from a pilot project that it
has increased homelessness.

Department for Work and Pensions minister James Plaskitt told the
National Housing Federation annual conference last week that it was
“inconceivable” that wider reform of the welfare state would not
include housing benefit, with necessary legislation expected in the
next couple of months.

A local housing allowance, which is to replace housing benefit, is
being piloted in 18 areas for tenants renting in the private
sector.

Plaskitt said that the allowance, which is paid directly to tenants
and is based on the average cost of housing in each area rather
than a person’s actual rent, reduced complexity and encouraged
choice and individual responsibility.

Emerging evidence from the pilots had found that benefit processing
times were reduced, and there was no significant impact on rent
arrears, he added.

But the minister was challenged by a delegate who told the
conference the scheme had increased homelessness in north east
Lincolnshire – one of the pilot areas.

Doug Pickett, a Liberal Democrat councillor and council
representative on Shoreline Housing Partnership, said the allowance
had prompted landlords to start selling their houses because rent
payments were no longer guaranteed.

He said some people were unable to manage their money and
homelessness had risen so much that the partnership was no longer
able to provide for non-homeless people on its waiting list.

Plaskitt said he was looking into the case but claimed most of the
pilots showed that the allowance reduced homelessness and had no
significant effect on arrears, citing Brighton as particularly
successful.

Plaskitt also announced that he would extend “some form of local
housing allowance” to the social housing sector, but promised to
“tread very carefully” and consult stakeholders.

Patrick South, interim director of policy at Shelter, said its own
monitoring of four pilots suggested that fears about rising
homelessness and arrears had not been realised.

But he said the allowance had to be set at adequate levels when the
programme was rolled out, and that the single room rent, in which
under-25s are only given enough benefit to afford a room in a
shared house, was causing hardship.