'Removing help with housing costs for young people was a mistake.'
The government's own figures show removing help with housing costs for 18-21-year-olds was a mistake, time to scrap the policy, says CIH policy and practice officer David Pipe.
The government's statistics on its decision to remove many 18-21 year olds’ entitlement to help with their rent shows the policy isn't working.
The measure was first proposed in the Conservative Party manifesto ahead of the 2015 election and was then confirmed in the summer Budget shortly after it. At that time there were very real concern that if young people were not able to access benefits, it would leave thousands without any viable housing options and drive many of them in to homelessness.
Thankfully the policy has been watered down significantly since then so that, by the time it was introduced last April, there were a significant number of exemptions in place. These include anyone who has children of their own, anyone who is working at least 16 hours at the minimum wage and anyone who is deemed unable to live with their parents.
It also only applies in areas where the full universal credit service has been introduced. At this point that is still not the case in most parts of the country, although the rollout is due to accelerate over the coming months and should be complete by September this year.
The statistics show that all of this has greatly reduced the policy’s impact to such an extent that over a three-month period only 90 people were told that they are not eligible to receive the housing costs element of UC (the equivalent of housing benefit).
This is of course excellent news. It’s a huge relief that a policy that we had major concerns about is not affecting large numbers of people in practice. Even so, it is still worth reflecting on what these statistics tell us. I think they confirm two important points.
Firstly, they call into question the original rationale for the policy. At the time it was first announced David Cameron suggested that it was necessary to “end the idea that aged 18 you leave school, go and leave home, claim unemployment benefit and claim housing benefit… You can start a life on dependency.”
The implication was that many young people had plenty of other housing options available to them and were claiming housing benefit simply because they could. However the fact that 96 per cent of those who have since applied for UC to help them to pay their rent were found to qualify for one of exemptions, surely blows this argument out of the water entirely. It should be clear now that the group that this policy was intended to target simply don’t exist, or at least not in any significant numbers.
Secondly, the statistics also suggest that the administrative and other burdens associated with the policy may well outweigh the cost savings it delivers. Details of the amounts saved as a result of claims being refused have not been published but it seems reasonable to conclude that, even once it is in place across the whole of UK, this is not a policy which is going to save the Treasury a large amount of money. It seems entirely possible that cost of administration could even exceed those savings.
And there also remains a danger that landlords may be withdrawing from housing young people unnecessarily. We don’t have the data to quantify this but we do know that when landlords, for example, were required to check the immigration status of their tenants many simply withdrew from housing non-UK citizens entirely.
Private landlords are often a risk adverse group and, as with the immigration checks, many may have decided not let to anyone under 21 ‘just in case’. This could make it much more difficult for some young people to find a suitable place to live, even though we now know that their UC claim will almost certainly be accepted. Is this a price worth paying for such a small cash saving?
Overall the statistics confirm what we have been saying for some time, that young people who apply for help paying their rent do so because they need it and that government would be better off scrapping the measure entirely.
David Pipe is policy and practice officer at CIH.