Government announces £65m fund to support struggling renters

Renters on low incomes who have built up arrears during the pandemic will be given funds to prevent them from falling into homelessness, the Westminster government has announced.

The £65m support package will be available for households at risk of eviction or homelessness to claim from their local council.

The Big Issue’s Stop Mass Homelessness campaign has been warning of a surge in homelessness in the months ahead after renters racked up arrears during the pandemic. 

With protections and support in place during the pandemic – such as the eviction ban, the furlough scheme and the £20 universal credit increase – withdrawn in recent months, thousands of families living in private rented homes are at risk of homelessness.

The Big Issue has been calling for renters’ debts to be paid off since launching the Stop Mass Homelessness campaign in the summer. 

The campaign asked the government to pay £360 million in rent arrears and provide additional support to help those unable to pay their rent or mortgage since its inception.

Lord John Bird, founder of The Big Issue, welcomed the announcement but added “far greater action will be needed to stop a catastrophic rise in homelessness”.

The government’s £65m package for renters is on top of the £500m for small grants to vulnerable households already pledged through the Household Support Fund in September. Renters are also able to access £140m of discretionary housing payments from their local council to prevent evictions.

“We have taken action throughout the pandemic to support the most vulnerable families, and it is vital we continue to provide support as we enter the winter months,” said rough sleeping minister Eddie Hughes.

“This new funding will support families that are struggling and help to get them back on their feet as we begin to recover from the Covid-19 pandemic.”

But the funding has faced criticism for failing to cover the true scale of the debt crisis.

The Joseph Rowntree Foundation (JRF) laid bare that scale earlier this week. The anti-poverty charity reported that 950,000 low-income households are living in rent arrears.

A household can be evicted from their property for just two months’ worth of rent arrears under section 8 of the Housing Act.

JRF asked the government to offer targeted debt relief with £500m grant funding through the Household Support Fund to support families with rent debt as well as household bills, council tax and energy costs.

Lord John Bird, founder of The Big Issue, said: “I am very pleased to hear the government has listened to our call to keep people in their homes and stop mass homelessness. It is vital that they are taking preventative action to ensure people will not be left homeless this winter. The end of furlough and the lift of the eviction ban have posed a very grave danger to everyday families and individuals who are struggling to make ends meet as a result of Covid-19 poverty.

“This is certainly a welcome announcement, however there is £360 million in rent arrears in the UK currently, so far greater action will be needed to stop a catastrophic rise in homelessness. We have seen brilliant and bold action taken by this government during the Everyone In programme and the Job Retention Scheme. I hope we see more of this over the next few months.

“Although one of our calls to the government has been in observed in part here, we desperately need to see investment in jobs and training in sustainable industries as part of the long-term solution.”

Homelessness charity Crisis has also been urging the government to boost support for renters after revealing the number of universal credit claimants at least two months behind on rent soared by 70 per cent in the first half of this year.

“We of course welcome this funding that should help keep some of those most at risk of homelessness off the streets this winter. It is now vital councils use this funding to help people most at risk of losing their home,” said Jon Sparkes, chief executive of Crisis. 

“But with almost a million households across the UK in rent arrears and the cost of living rising rapidly, it is impossible for this funding to meet the demand we face. To prevent homelessness in the first place, we desperately need the UK government to ensure that housing benefit covers the true cost of renting by unfreezing the Local Housing Allowance.” 

Alicia Kennedy, director of Generation Rent, said the funding is a “significant step forward” but feared “it won’t be enough to prevent families hitting crisis point”.

Chris Norris, policy director for the National Residential Landlords Association, agreed that that the funding “does not fully reflect the scale of the problem”. He said: “With warnings that rent debts could pose a risk to the economic recovery and the government admitting that many landlords are highly vulnerable to arrears the Chancellor must go further.”

The Big Issue is working to prevent thousands of people hit by the pandemic from falling into homelessness in the months ahead through the Stop Mass Homelessness campaign. Sign our petition and find out how you can take action now here.