A near-30percent cut to a government fund supposed to help councils, such as Croydon, to reduce homelessness, coming at a time of rising cost-of-living, risks “tens of thousands of people falling into arrears and facing eviction as people struggle to stay afloat”.
That’s the warning of homelessness charity Crisis, after the Tory government this morning announced that it is cutting £40million from its Discretionary Housing Payment fund.
English and Welsh councils will have £100million available to them in 2022-2023 through DHPs, down from £140million in the current financial year.
Those working in the local authority housing sector were unanimous in their condemnation of the cuts.
David Renard, the housing spokesperson for the Local Government Association, told the Inside Housing website that the government should be increasing its Discretionary Housing Payments.
Renard said today’s announcement of a reduction is “concerning” and comes at a time when a “range of other funding is being withdrawn, such as the Household Support Fund”.
Renard said, “We would like to see a commitment from government to review and increase the Discretionary Housing Payments urgently if demand for support is shown to be greater than last year.
“We also urge the Chancellor to use the forthcoming Spring Statement to put in place effective, sustainable support for low-income households to ensure that they are not at risk of hardship, homelessness and reduced opportunities as a consequence of the squeeze on households finances.”
Darren Rodwell, a member of Croydon Council’s recently established Housing Improvement Board, also hit out at the cuts.
“London faces the most severe homelessness crisis in the country and DHPs are boroughs’ main homelessness prevention tool,” said Rodwell, the Labour leader of Barking and Dagenham Council.
“Huge numbers of Londoners are struggling with the cost of living and reduced funding for DHPs risks undermining our ability to help them avoid homelessness.”
DHP funding is available for anyone entitled to Housing Benefit or the housing element of Universal Credit who needs further help.
The government has made additional DHP funding available to local authorities since 2011, intended to support households adjusting to the welfare reforms, which were introduced in 2013 and brought in cuts and changes to the system.
The cut to the fund, the main objective of which is to prevent homelessness, comes amid the cost of living crisis and soaring energy bills due to rising wholesale gas prices.
A spokesperson for the Department for Work and Pensions said: “This government is working across the country to help people with their housing needs, and is spending over £2billion to tackle and prevent homelessness and rough sleeping over the next three years.
“The change in Discretionary Housing Payment funding also reflects the rise in Local Housing Allowance brought in at the start of the pandemic, which we are maintaining, and government spending on housing support remains higher than pre-covid-19 levels.”
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