Thursday, 02 April 2015

Local authorities are hampering efforts to keep people off the streets, charities claim

Councils lock away housing crisis funds

The scrapping of a scheme to provide emergency loans to vulnerable people is worsening homelessness, charities have warned.

Since 1 April people can no longer apply for ‘crisis loans’, which were administered by job centres for essential costs in an emergency.

The government has since handed a £178.2 million fund for crisis loans and community care grants to local authorities, which have replaced crisis loans with their own discretionary schemes.

Homelessness charities, including the London mayor’s No Second Night Out scheme - which aims to stop people sleeping a second night on the streets - used these loans to help pay for deposits and rent advances when securing homeless people private sector accommodation. But since the change charities have found it almost impossible to secure the replacement emergency loans from councils, hampering their efforts to get people off the streets.

Tommy Cloherty, head of homelessness services at charity Hope Worldwide, said he ‘absolutely’ expected this to increase homelessness. ‘There are people who have already missed out on opportunities because they have not been able to provide rent in advance.’

Mr Cloherty said it was a particular problem in London because rents were so high and landlords can ‘cherry pick’ tenants.

Petra Salva, director of the London NSNO scheme, said her staff used to be able to secure crisis loans for three quarters of its service users in the 34-bed spaces it has separate from its two ‘hubs’, usually within a couple of days. Since April it has not managed to secure a single loan.

She said councils refuse loans suggesting alternatives such as budgeting loans - but these take weeks to secure from Jobcentre Plus, by which time a homeless person will have lost a property.

Duncan Shrubsole, director of homelessness charity Crisis, said the loans ‘can make the difference between someone getting a roof over their head or sleeping on the streets’.

‘Ultimately the government needs to rethink this and reintroduce a clear national framework,’ he added.

A spokesperson for umbrella body London Councils acknowledged that since April some clients in need of emergency help had not received the correct advice from Jobcentre Plus: ‘This has led to an increase in referrals and approaches to councils, which are not always able to provide the type of assistance these clients need.’

A spokesperson from the Department for Work and Pensions said: ‘Crisis loans were previously too complex, over-centralised and poorly targeted.’

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