Press release: Young people living independently need a stable foundation of housing and income if they are to earn and learn

A report published today (23 May 2018) by the Social Security Advisory Committee (SSAC) calls on the UK government to do more to help young people living independently take advantage of training and employment opportunities by easing the immediate – and in some cases very significant – pressure on their day-to-day budgets.

At least 300,000 young people live independently on benefits – that’s 1 in 25 of all 16 to 24 year olds. Many of them have absolutely no choice but to live independently due to circumstances outside of their control. They may, for example, be care leavers without any close family or unable to live at home because they are at risk of abuse or violence.

Many of these young people told us they very much appreciate the support of the benefits system. They acknowledge that, were it not for this support, they could well be homeless. We also heard that young people in care have benefited greatly from the financial support made available to them by local authorities in England, Scotland and Wales and the Department for Work and Pensions as part of the ‘staying put’ initiative. This enables them to remain with their foster parents until they are 21 when they are arguably better prepared for independent living – both in terms of finances and maturity. The government’s recent announcement that housing support would be reintroduced for all young people who are unemployed or in low paid work – reversing a measure implemented just over a year ago – is also very welcome.

However, despite the support available, many young people who live independently find it difficult simply to ‘get by’. Our research shows that:

• Young people on the shared accommodation rate of Housing Benefit are struggling. Affordable and available accommodation can be very hard to find. In some areas, just 1% of vacant rooms are affordable and available to young people on benefit. Some landlords refuse to let rooms to anyone on benefit, limiting the number of available rooms even further. As a result, many young people live in very poor quality accommodation, which they can only afford by using other forms of income – including benefits designed for food and other basic living costs.
• Young claimants inevitably have limited experience of budgeting, which means they may be more likely to fall into rent arrears and be evicted than older counterparts. The wait for the first payment of the housing element of Universal Credit increases the risk for some young people making a new claim. Income security is especially important in these formative years. We think it is unrealistic to expect young people to look effectively for training and work opportunities when they are struggling to pay the rent.
• A young claimant living independently is almost 4 times more likely to have their benefit sanctioned (that is, stopped or reduced) than an older claimant. In many cases, the failure of the individual to comply will not be in question. But it is crucial to understand the context. Many young people who live independently have no family support or guidance, may be living stressful or disorganised lives and have very little life experience. Penalising people in this situation may well not be the best way of supporting them into work. There should be a duty on the government to support young people who live independently better during these unsettling formative years. We suggest establishing youth specialist work coaches and more actively promoting the take-up of the support already available that can help with costs of travel to interviews, purchase of work clothes etc.

The fundamental question behind the report is whether the core benefit rates for young people are sufficient to support a springboard into training and employment. For example, we heard about a young person who had just £20 available for food each month – that’s less than £1 a day – once other essential costs (such as utility bills) had been taken into account. If the financial challenge of funding the essentials of daily life was eased, young people would inevitably be better placed to identify and secure the opportunities to progress that exist.

Paul Gray, Committee Chair said:

It is understandable why the government has adopted a position that young people in receipt of benefits should face the same choices as other young people who go out to work and cannot yet afford to leave home. But it is important not to overlook the fact that many of the young people living independently have not made a choice to do so.

No one could reasonably argue that those leaving care or at risk of abuse at home should be disadvantaged by the benefit system for circumstances outside of their control. They should be better supported in making their first tentative steps towards a better future.

Seyi Obakin, Committee Member said:

A Centrepoint employee recently said that their work was important because young people are often overlooked and deserve an empowering network around them to help make them want them to succeed and to realise their potential. An empowering network would help young people to access safe, stable, affordable places to live; access income from stable work in which they can thrive; and improve their financial literacy.

But while young people are on their journey to these outcomes, they need meaningful and consistent support from the Department for Work and Pensions – both financial and in terms of employment advice.

Full set of recommendations

The full set of recommendations set out in the committee’s report are that the Department for Work and Pensions should:

1. Ensure every young person aged under 25 is proactively offered a choice about whether their housing-related benefits are paid directly to their landlord or into their own bank account, and about whether Universal Credit is paid to them fortnightly or monthly.
2. Place a duty on jobcentre work coaches to inform young people about all available grants and funds. Consider ring-fence funds to provide additional support towards work-related costs, such as buying equipment or work-specific clothing, or travelling to and from work.
3. Change the application of sanctions for young people living independently via a number of adjustments to the sanction process to decrease the risk of inappropriate sanctioning.
4. Trial both youth specialist work coaches and also specialist advisors who support work coaches in their interactions with young people with complex needs – focusing first on those living independently. This should be evaluated, and rolled out more widely if successful.
5. Exempt care leavers from the shared accommodation rate and the under-occupancy penalty until they reach age 25.
6. Monitor the numbers of 16 to 24-year olds living independently who are eligible for but not in receipt of benefit. Tackle the barriers to claiming the benefits to which they are entitled and receiving the support they might need.
7. Publish evidence demonstrating the affordability of basic living costs for a young person living independently on benefits and take action if these rates are not enough to cover essential living costs.
8. Publish evidence on the affordability and availability of housing for young people at the shared accommodation rate in every broad market rental area, and take action where affordability is too low.

About SSAC

SSAC is an independent advisory body of the Department for Work and Pensions. The committee’s role is to give advice on social security issues; scrutinise and report on social security regulations (including tax credits) and to consider and advise on any matters referred to it by the Secretary of State for Work and Pensions or the Department for Social Development in Northern Ireland.

The committee membership comprises: Paul Gray (Chair), Bruce Calderwood, David Chrimes, Carl Emmerson, Chris Goulden, Philip Jones, Jim McCormick, Grainne McKeever, Dominic Morris, Seyi Obakin, Judith Paterson, Charlotte Pickles, Liz Sayce and Victoria Todd.

More information

For more information contact Denise Whitehead, Committee Secretary.