Moral logic is flipped on its head in England’s benefits system, which systematically excludes the poorest people from the only housing that was ever intended for them. Social homes were supposed to be for those who couldn’t afford private rents. However, a new report by Crisis shows that, because the stock of homes has been allowed to collapse, housing associations now ration supply by applying strict affordability tests. The homeless charity found that seven in 10 people with a history of rent arrears and no repayment plan would “sometimes” or “always” be excluded from housing registers. Perversely, England’s welfare system induces the very homelessness that it claims to alleviate.
Financial checks, along with rules requiring “local connections”, sharply narrow who can join the queue for social housing. For those who do, a further round of pre-tenancy checks means that about a third of housing associations refuse accommodation because applicants cannot afford even modest rents, a problem rooted in benefit levels that are simply too low. Homelessness therefore rises by design rather than accident. Its origins lie in the coalition’s austerity programme: instead of building social homes, which would have eased pressure on welfare, the government redefined who could qualify. The then chancellor George Osborne, it was said, resisted building houses that might create Labour voters.
Housing associations began as charitable ventures, with an ethos of personal responsibility. But for most of the 20th century, social housing in England was built and run by councils with central government funding. Then Margaret Thatcher introduced the “right to buy” – selling off millions of units of public housing. Only a fraction were ever replaced. Because local authorities lost stock and revenue, the state shifted responsibility to housing associations, which by 2012 were governed by financial viability requirements. New-builds were constructed with expensive loans.
What was once a moral mission to house excluded people has been replaced by a corporate logic that screens them out. Rent collection became crucial, arrears became a “business risk”, and tenant assessment was prudent stewardship. The localism act of David Cameron’s government, as Crisis says, shifted the responsibility to councils, which could narrow eligibility for housing so that need disappears. This is a cruel system. People with “complex needs” such as disability need support to sustain tenancies, but cuts to local council budgets mean there is no cash to do so.
At the heart of the current dilemma is a catch-22: people are too poor to rent privately, yet too poor to pass affordability tests to get social housing. Scotland shows that this is a policy choice. Scottish housing associations are legally required to rehouse homeless households. In England just 27% of new social lettings go to homeless households. In Scotland the figure is double that. Wales is looking to follow Scotland’s lead; so should England.
There needs to be a wholesale rethink on welfare – not least so those on the lowest incomes can access, and afford, social homes. Crisis says the £39bn decade-long funding for Labour’s “affordable homes” programme is a good start. But it argues that 90,000 homes at social rent need to be built annually for the next 15 years. Without being expanded, the current plans amount to “rearranging deckchairs on the Titanic”. Clearly, if social housing is not rebuilt as a public good in England, the poorest will go under the waves.
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