2 hours ago
11
The first UK trial to test the impact of unconditional cash payments on homelessness found people given £2,000 were more likely to be happier, in stable housing and had stronger relationships six months later.
The landmark study by the Policy Institute at King’s College London found that young people leaving care who were given a one-off £2,000 cash lump sum, with no strings attached, were less likely to be sofa-surfing than their peers and had a better quality of life.
Young people who received the cash transfer also reported they spent 12% less on alcohol, tobacco or drugs than they had previously.
“It shows that there are some people for whom a payment of that amount at the right time changes their trajectory in life,” said Prof Michael Sanders, director of the experimental government team at the Policy Institute. “It enables them to secure a standard of housing and make sure they’re comfortable there.
“I came into this hopeful that it would work, but certainly sceptical. But the research has been positive in what it tells us about not just the improvements to people’s lives, but the reduction in the need for other services, which saves money.”
Commissioned by the Centre for Homelessness Impact, it is the first study of its kind with a large enough sample size to draw quantifiable conclusions.
For the study, 99 young people leaving local authority care in nine areas in England received the one-off sum in June 2023. Their progress was tracked at six and 12 months, and compared with 200 similar care leavers who did not receive the payment.
Researchers found participants who received the money were eight percentage points more likely to be in stable housing six months later, and there was a more than six-point drop in sofa-surfing.
Research shows that people with experience of the care system are disproportionately affected by homelessness – about one in 10 people sleeping rough in London have been in care, and more than a quarter of young people leaving care report having sofa-surfed.
People who received the money were also less likely to have experienced an eviction linked to antisocial behaviour, had better wellbeing, and felt more optimistic for the future and able to deal with problems a year after the payment.
Young people who got the money were also more likely to see a GP or attend a drop-in clinic and less likely to stay overnight in hospital, although this effect reduced over time. Overall, there were 17 fewer overnight stays in hospital among the group who received the cash sum.
One participant reported spending the money on a laptop that enabled her to complete further education. Aeryn said when she found out she was receiving the money, she “was speechless for a good 10 minutes”.
“They said: ‘Here’s your money, you can do what you want with it.’ These things don’t often happen to me,” she said. “I think it pushed me forward.”
Sanders said this type of support was “easier and cheaper to administer” than conditional benefits, and “allowed recipients more agency and dignity”.
He said: “The dominant finding from the anecdotes is that these young people spend the money in really sensible ways. A good number of them said they spent half of it and then saved the other half of it for a rainy day.
“We’re quite keen to see local authorities and ideally the national government starting to think a bit differently on this. We’re saying these young people are less likely to have been arrested and less likely to be rough sleeping – that’s a whole bunch of services the Treasury doesn’t have to pay for.”
