Changes to the shared accommodation rate will force thousands of vulnerable people out of their one-bedroom flats and into houseshares. Emily Rogers investigates the impact
James takes comfort from his one-bedroom flat in the Coventry suburb of Earlsdon. Unemployed and recovering from a debilitating bowel disease, it gives him the space he needs to get his life back together again.
The 32-year-old, who was made redundant nearly four years ago, moved into the £400-a-month flat in August 2008. He has been looking for work ever since and describes his financial situation as ‘increasingly untenable’. But from next year, he says his situation will become ‘beyond untenable’ when the £103 of weekly housing benefit he receives to cover his rent will be slashed to just £60.
For James, who has Asperger syndrome, a form of autism which causes difficulty in his interaction with others, this will mean losing his home and moving into a room in a shared house. ‘It will be horrible,’ he says. ‘Having to share with people could lead to very distressing living conditions.’
James is just one of 62,500 private renters of one-bedroom flats across the UK who the government has decided should only be entitled to enough housing benefit to cover a single room.
This shared accommodation rate is currently only compulsory for single people under 25. But from January 2012 it will be extended to single claimants under the age of 35. The move will leave around 62,500 people across the UK worse off by an average of £41 a week and by more than a £100 a week in the hardest-hit London boroughs, according to a government impact assessment published last month.
The change, announced in the comprehensive spending review last October aims to save £215 million a year by 2014. It is part of a £1.8 billion package of housing benefit cuts, which Inside Housing is challenging in its ongoing What’s the Benefit? campaign which calls for fairer benefit reform. There are certainly concerns that the shared room rate extension will have unfortunate consequences for many, particularly the vulnerable. Charities and housing providers are calling for a rethink and striving to soften the blow in case that rethink doesn’t come.
Increasing the number of people forced to share a home has sparked fierce opposition from charities warning that it could cause widespread homelessness by forcing thousands out of their homes in search of an already over-stretched supply of shared housing. The government remains committed to the change, leaving James and many like him facing anxious and uncertain futures.
The government’s impact assessment reveals 71 per cent of people affected by the change are men, 84 per cent are unemployed and 18 per cent have registered disabilities, such as mental health problems, not covered by the exemption for those with severe disabilities. An estimated 18 per cent are parents who do not have custody of their children and may depend on self-contained accommodation for continued contact with them.
‘Many of the people claiming will have a range of problems, such as mental health issues, or they might be homeless or coming out of prison,’ warns Katharine Sacks-Jones, head of policy at Crisis. ‘And for vulnerable groups such as these, sharing is often not appropriate and can cause real problems, including tenancy breakdown and homelessness.’
It is hard to quantify how many single 25 to 34-year-old benefit claimants there are with vulnerabilities which will make it difficult or impossible for them to houseshare. Anecdotes about the detrimental effects of the shared accommodation allowance on vulnerable groups keeps rolling off the tongues of front line staff from organisations such as Citizens Advice, which has fought the allowance since its introduction for the under-25s in 1996.
Their stories include a 23-year-old receiving treatment for drug misuse and mental health problems, who is homeless and sleeping on friends’ floors because he knows that life in shared housing would ruin his recovery. Or the woman who had to stop work due to mental health problems, who is recovering well in her own flat near a supportive community health team. Her age will force her onto the shared accommodation rate next year, leaving her terrified at the prospect of being uprooted.
Charities including Citizens Advice and Crisis are pressing for more vulnerable groups than just the severely disabled to be exempt from the change, or for more freedom for councils to exercise discretion in deciding when it’s not suitable for somebody to share.
One of the hardest-hit councils is Islington in north London, where 290 claimants between 25 and 34 will lose an average of £115 a week. That is nearly half their current weekly entitlement, says James Murray its cabinet member for housing.
Mr Murray, whose authority voted in support of Inside Housing’s What’s the Benefit? campaign last year, adds that the change will ‘hurt a lot of people’. ‘If we’re trying to help them, it will put a lot of pressure on our resources,’ he says. ‘We’re already having difficulty in the council getting private rented accommodation generally to house people. And this new change will make it even worse.
‘Lots of boroughs are very concerned about this and many colleagues of all political persuasions I’m talking to are sharing these views about it.’
Islington Council has set up a team to get in touch with those affected by the change. ‘We want to talk to them early, make sure we understand what’s going on and help wherever we can, negotiating with their landlords and finding them alternative accommodation.’
Islington is one London borough, along with Camden and Haringey, where homelessness charities such as St Mungo’s are making every effort to prepare their clients for the change. The charity, which estimates that up to 800 of its 1,500 residents could be affected, has set up PAL Flatmates, a £50,000 scheme to get groups of people together who are ready to move from hostels to house sharing.
Martin Blakemore, its co-ordinator, has been holding informal coffee mornings to help hostel residents team up with potential flatmates and prepare themselves for housesharing. The PAL scheme builds on St Mungo’s Peer Advice Link service, which involves previously homeless people advising hostel residents about moving on to independent living. PAL volunteer Rob, who was homeless but now has his own flat, says moving back to a single room will be ‘catastrophic’ for some.
‘A lot of people we work with have had quite a traumatic time of things and it helps massively to have your own place and shut your front door,’ he says. ‘You might find you need peace and quiet. Maybe you’re trying to stay away from alcohol, but then you’re put in a house with someone who’s drinking daily. I don’t think this change bodes very well. I think the only result is we’ll find a lot of people back on the streets.’
But St Mungo’s is trying to ensure that as many hostel residents as possible cope with the transition. It has a five-bedroom, suburban semi in Enfield, north London, which it is treating as a ‘halfway house’ between supported hostel life and full independence in a shared house. The charity will move groups of its clients in so they can try living with each other for several months, drawing on the charity for help, if need be.
In the meantime, Mr Blakemore will try to persuade private landlords to provide housing for these groups, offering incentives such as an insurance scheme, which involves the charity acting as guarantors for its clients’ rent.
Charitable middle-men like him appear to be up against an additional problem - the shortage of shared homes to accommodate the thousands moving up from hostels or down from self-contained flats.
Nearly three quarters (72 per cent) of almost 350 UK housing advisors surveyed by Crisis in April said there was not enough shared accommodation to move people into, with 87 per cent saying it was already difficult to find homes for the under-25s already on the shared accommodation rate.
Meanwhile the Department for Work and Pensions’ own two-year review of the local housing allowance, published earlier this year, found rent officers had been reporting a shortage of shared accommodation in rural areas or market towns.
Chris Town, vice chair of the Residential Landlords Association, which represents more than 9,500 private landlords, says this group has increasingly preferred to provide self-contained accommodation in recent years, because it attracts higher rents and is easier to manage.
He argues that the extension of the shared accommodation rate from under-25 to under-35 has prompted some landlords to start moving these tenants out before the benefit cuts hit. ‘They have a business decision to make,’ he says. ‘We don’t get any sympathy from lenders at the moment for anything like this, so clearly landlords will have to make decisions, or leave themselves exposed to possible borrowing problems with their lenders.
‘People are left with a stark choice. However much you like a particular tenant, if he can’t manage the asking rent because of the restriction in benefit entitlement, you have to let him go.’
Findings from a National Landlords Association survey of more than 450 of its members suggest most private landlords are not planning any increase in the amount of shared housing they offer as a result of the change.
And both landlord organisations warn that the supply of shared housing will be further choked by ‘article 4 directions’ - measures which use planning law to limit the number of homes in multiple occupation. The NLA says at least 30 councils are going down this route, including Manchester, Leeds and Portsmouth.
In the face of the widespread criticism, ministers argue that more than a third of the single 25 to 34-year-olds in receipt of housing benefit and who will be affected by the change already receive the shared accommodation allowance, because they have chosen to move into single rooms in shared homes.
They insist that extending this allowance to those under-35 will make things fairer by ensuring that people on benefits are not enjoying flats of their own which their in-work peers could not afford.
‘Our housing benefit reforms do not necessarily mean people will need to move, but claimants will have to make the same choices about affordability as those not on benefits,’ a DWP spokesperson says.
Last month’s impact assessment stated that the change would force ‘many’ out of their homes. Ministers seem to be placing their faith in the ‘big society’ to open up rooms in their homes to accommodate them all.
‘If you think that things will be a bit tight and that some people might face unemployment and therefore will need some extra income, we might find that more owner-occupiers in a particular area are renting out spare rooms,’ pensions minister Steve Webb told fellow MPs in March. ‘That might be a very rational thing to do and it will increase supply.’
This idea fills James from Coventry with horror. ‘I would feel really uncomfortable being a long-term guest in someone else’s home,’ he says. ‘I’d be really nervous and not know how to behave. I’d really feel like a cuckoo in the nest.’
Sharing singles: winners and losers from the shared room rate extension
62,500 - the number of 25 to 34-year-olds currently in one-bedroom flats who will lose out
35,780 - the number of 25 to 34-year-olds affected by the extension of the shared accommodation allowance to their age group, but are already on this rate because they have chosen to live in shared housing
£176 - the average weekly housing benefit payment for a one-bedroom flat in London
£102 - the national weekly average housing benefit payment for a one-bedroom flat
£90 - the average weekly shared accommodation allowance for over-25s in London
£70 - the national average weekly shared accommodation allowance for over-25s
40 per cent - the proportion of single, childless, non-student private renters living in shared accommodation
6 - the number of London boroughs where affected claimants will lose an average of more than £100 a week (Camden, Islington, Kensington and Chelsea, Tower Hamlets, Westminster and Brent)
Source: Department for Work and Pensions impact assessment