Charity slams housing support cuts

Looming cuts to housing support will put England at risk of becoming a "knife-edge nation", where people who lose their job will also see their home put under threat, a charity has warned.

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Shelter warned that many more families who live in the private rental sector will be at risk of becoming homeless after Government reforms take effect.

Looming cuts to housing support will put England at risk of becoming a "knife-edge nation", where people who lose their job will also see their home put under threat, a charity has warned.

Shelter analysed the impact that the removal of a "safety net" for people who lose their job will have after the Government's controversial Universal Credit reforms roll out from this autumn.

Under the current system, renters who have not claimed housing benefit in the previous year get the full cost of their rent covered for up to 13 weeks if they become unemployed.

But Shelter warned that under Universal Credit a renter will only receive a standard amount towards their housing costs, which it said is likely to be a lot lower than the average private rent.

The charity fears that many more of the country's 2.5 million families who live in the private rental sector will be at risk of becoming homeless when the reforms take effect.

It identified Manchester, Bristol, east London, Norwich and Newcastle as "worrying hotspots" where high housing costs, high unemployment rates and large numbers of people renting could combine to increase the chances of job hunters becoming homeless.

Shelter's research found that three-fifths of working families are already struggling or falling behind with their rent or mortgage. A previous study by Shelter found that more than one third of workers (35%) could not pay their rent or mortgage for more than one month if they lost their job.

The charity's analysis found that a family renting a three-bedroom home would need to find an extra £100 a month in more than one quarter of the country as soon as they become unemployed, or risk getting into arrears.

In Manchester, the shortfall is likely to be around £145 a month and in Norwich it could be more than £125, according to Shelter's calculations.

Some 61% of renters surveyed by Shelter said they would find it "impossible" to pay their rent if they needed to find another £100.

The findings come at a time when demand from tenants for homes in the rental sector remains strong and rents have been on the increase.

Office for National Statistics (ONS) figures released yesterday showed that rental prices have increased by 1.2% across Britain over the last year, while in London they have risen by 1.9%.

Campbell Robb, chief executive of Shelter, said: "This research highlights the frightening reality that as support continues to be cut, losing your job is increasingly likely to mean losing your home.

"The high cost of housing, rising living costs, and job insecurity are already making it incredibly tough for families to survive. Just one thing, like an illness or redundancy, can be all it takes to tip a family on a downward spiral."

Shelter quoted teacher Abi Reilly, who lives with her husband, a cleaning supervisor, with their two young children in a rented home in Reading.

Ms Reilly said: "Even though my husband and I both work hard, just paying for the essentials of rent, food and bills means we don't have any spare cash left over at the end of the month.

"If either of us lost our jobs now, I don't know how we'd afford to keep the roof over our heads.

"Looking for another job whilst dealing with the risk of losing our current home would be unbearable."

More than three-quarters (77%) of people surveyed by Shelter said finding a new job would be made harder if they also had to find a new home.

The Government said that only a "tiny percentage" of housing benefit claimants receive help from the 13-week rule, which was designed 27 years ago.

It argues that the package of Universal Credit reforms will also give people a much clearer route back into work.

A Department for Work and Pensions spokeswoman said: " This is an outdated and poorly targeted use of public funds that helps only a tiny percentage of housing benefit claimants for a short period of time and fails to support low income workers.

"In fact, three million households will be better off under Universal Credit, with people getting their housing support paid at the rate that reflects their personal circumstances, while also benefiting from better work incentives."