As part of the Autumn Budget 2025, Chancellor Rachel Reeves announced today that the Government will introduce new earned income disregards in Housing Benefit for people living in supported housing and temporary accommodation, which will reduce the financial cliff edge as people move into and progress in work.
Responding to the Budget, Emma Haddad, Chief Executive of St Mungo’s, said:
At St Mungo’s, we see how vital work is to a person’s recovery from homelessness, which is why we warmly welcome the Chancellor’s decision to address the long-standing anomaly in the benefits system that discourages people in supported housing from entering work.
This change follows years of persistent campaigning from St Mungo’s and the wider sector. It is reassuring to know our voices have been heard. These reforms will help clients living in supported accommodation return to work and rebuild their lives. We look forward to working with Government to ensure that this solution benefits everyone affected.
However, we cannot ignore that we are in the middle of a homelessness crisis, which is being driven by a persistent shortage of affordable and social housing.
Therefore, the Chancellor’s decision not to unfreeze Local Housing Allowance rates or lift the Benefit Cap is disappointing and a missed opportunity, particularly as it would have protected thousands from homelessness by bringing housing benefit in line with real rental prices.
