Housing benefit cuts would 'affect schemes for vulnerable'

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Housing projects helping more than 400,000 vulnerable adults face closure because of government welfare cuts, analysis on behalf of Labour suggests.

The Treasury's decision to cap housing benefit at the level available for private rents makes many schemes unviable, according to the research carried out by housing providers.

The housing cap is part of a £12bn package of cuts from the welfare bill.

The government refuted the figures and called the claims "spurious".

The Labour Party, which commissioned the research, said under the proposed cuts an annual shortfall of £400m would put the frail and elderly at risk of losing their homes.

In the chancellor's Autumn Statement he said the rate of housing benefit in the social sector would be capped at the same rate as is paid to those in the private-rented sector - which he said would deliver savings of £225m by 2020-21.

'Major threat'

But some providers of supported housing say they rely on higher levels of housing benefit to cover the additional costs of care and support needed to cater for vulnerable adults.

The analysis - carried out by the Placeshapers group of housing associations - warned that the cut represented "a major threat to the financial viability of such schemes".

"Placeshapers is calling for all supported housing schemes to be exempt from the government's changes to social housing rent levels," it added.

The research suggested specific schemes such as one in Middlesbrough which helps vulnerable women, and another one in Norfolk for children with learning difficulties, would be in the firing line if the cap came into force.

'Increased funding'

Labour's shadow housing minister John Healey said the housing benefit cap would be a "catastrophe for those who can least afford it".

"There is no way these people or the organisations who support them can make up the yawning shortfall these cuts will open up," he added.

"If nothing is done, vital supported housing across the country will close, and the people who rely on them will be forced out."

A government spokesman said: "We do not recognise the figures and we have increased funding to councils by 40% since the last Parliament to help people who may need extra support whilst they transition to our reforms.

"From the outset we have been clear that vulnerable people will be supported through our welfare reforms.

"We are currently working on the detailed design of this policy and it is irresponsible to make these spurious claims over support for vulnerable people."

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