The cost of living crisis and homelessness
The crisis will impact people who are already on low or unstable incomes or relying on benefits the most.
Inflation alone will not cause an increase in homelessness and rough sleeping. But it will exacerbate other issues, such as the end of extra accommodation support that was provided to people sleeping rough during the pandemic.
There is a risk that more people will sleep rough for the first time, as households struggle to make ends meet. It will also threaten the progress of people who have rebuilt their lives after homelessness, who may be paying for their own accommodation and bills.
Our asks to Government
We are working with the Government to make the changes needed to support the people through this crisis. These are our top three policy asks:
- To increase benefits now in line with inflation, to make sure people are housed, warm and fed this winter.
- To urgently review the benefit cap, so it is in line with average household incomes and increasing cost of living.
- To make sure that as rents go up, Government support for housing costs increase too.
Although benefits increased by 3.1% in April 2022, this was not in line with inflation, which is now estimated to be at 9.4%. In May 2022, the Government promised that it will increase benefits to match inflation in April 2023. But it needs to happen much sooner than this, to support people through the winter months as energy bills soar.
The benefit cap sets a limit on the amount of benefits that people can receive. With the cost of living rising, people and families are already finding that their benefits are not covering the essentials, like food, showers and toiletries.
So far this year, 84% of the 5.6 million people receiving Universal Credit, many of them in working families, have been forced to go without at least one essential.
Local Housing Allowance (LHA) is a benefit to support people in private rented accommodation to pay their rent. During the pandemic, the Government increased Local Housing Allowance rates so they were in line with the bottom 30% of the market, so people receiving LHA were able to afford higher rents. This was frozen in October 2021, meaning as rents go up, the amount of properties that people can afford will go down.