HM Treasury
The Correspondence and Enquiry Unit 1 Horse Guards Road
Westminster
London
SW1A 2HQ

Dear Chancellor of the Exchequer,

We are writing to you as a charity which helps thousands of young people experiencing homelessness each year, supported by businesses and other charities, to raise our concerns about the barriers faced by young people who live in supported housing in getting into employment. We would like to see the Government take decisive action to address these barriers, such as by implementing the recommendations made in our 2023 report ‘Breaking Barriers to Work: Exploring the impact of the benefits system on young people living in supported accommodation and their ability to work’.

We know that having staff from a diverse range of backgrounds is valuable for employers, whether it enhances problem-solving, drives innovation, or brings fresh energy and commitment to the company. Young people at the start of their careers are an amazing resource, and they deserve to get the support they need to succeed in work.

Currently, many disadvantaged young people face significant barriers to entering the workforce. These include the high costs of transport and work-appropriate clothing, the difficulty of meeting basic needs while relying on benefits, and the challenges caused by the benefits system for those living in supported housing.

If a resident of supported housing works enough hours that their Universal Credit is tapered down to zero, which can happen after only 11 or 12 hours of work per week, their Housing Benefit is then also tapered based on their earnings. When this happens to someone living in supported housing, they become liable for paying the rent for their housing themselves, which they often cannot afford. This challenge is further exacerbated for young people under 25, who receive a lower Universal Credit standard allowance than those over 25, even if they are living independently with no family support. This means that their Universal Credit tapers down to zero more quickly than over 25s.

This issue prevents young people in supported housing from going into work, as they don’t feel a financial benefit from working. This negatively impacts their mental health, as they feel trapped in unemployment; their financial situation, as they are unable to work and save money or pay off debts; and their future careers, as they are unable to gain vital experience from employment.