The Government is being called on to use the Autumn Budget to fix a flaw in the welfare system that penalises young people in supported accommodation for finding work.
Wychavon, Malvern Hills District Council, Platform Housing Group and youth homelessness charity St Basils, have sent a joint letter to Work and Pensions Secretary Pat McFadden, urging an end to a ‘significant barrier to employment’ for young people.
Under current welfare rules, young people in private rented accommodation have their Universal Credit payments gradually reduced as their earnings increase, providing a platform for them to gain financial stability.
But young people who live in supported accommodation – like Wychavon’s Merstow Place scheme or Platform Housing’s The Foyer in Malvern Hills – face steep reductions at a faster rate because their housing welfare support is split between Universal Credit and Housing Benefit. This creates a cliff edge, which not only discourages them from finding or taking on more work but risks plunging them back into crisis.
Wychavon and Malvern Hills’ housing team has seen first-hand the impact of the supported accommodation penalty. In one case, a young woman living at Merstow Place found work as a job coach at the local job centre and was forced to leave the scheme before she was ready because of the rule flaw. This denied her access to the vital support she was receiving at the scheme to help her build the skills needed to live independently.
Cllr Rick Deller, Wychavon’s Executive Board Member for Housing, Regulatory and Customer Services, said: “Supported accommodation like Merstow Place and The Foyer provide a vital stepping stone to support young people to transition from crisis to long-term work and financial independence.
“But this is being undermined by the supported accommodation penalty, which whips away the lifeline young people are relying on, just at the point where they are rebuilding their lives.
"Analysis by the charity Centrepoint shows this penalty could be removed and still save the Treasury almost £5 million a year.
“In the budget this week, the Government can help young people transform their lives, save money and make work pay with a simple change to the rules. I urge them to grasp this opportunity.”
