Transform Community Development Urge the Chancellor to "show intent" in the Budget

Transform Community Development as part of a coalition of leading Scottish charities and academics has described this week’s Budget as the ‘first test’ of the Prime Minister’s pledge to end homelessness and called on the Chancellor to scrap three UK-wide policies which it warns are undermining Scotland’s effort to turn the tide on homelessness.

The Everyone Home Collective, which is convened by Homeless Network Scotland and brings together nearly 40 third sector and academic organisations, has written to the Chancellor urging him to use the Budget to end the freeze on Local Housing Allowance, abolish the benefit cap and scrap the bedroom tax.

Local Housing Allowance determines how much financial support low-income households can receive towards private rents, but the level of support has been frozen since 2024. The bedroom tax and the benefit cap were introduced by George Osborne and limit support to households, with the bedroom tax penalising households for having spare bedrooms.

The coalition says the three policies leave households with less money to cover housing costs, increasing financial pressures and raising the risk of homelessness.

While housing policy is devolved to Holyrood, the coalition warns keeping the policies in place will result in tens of millions of pounds of public funds in Scotland being diverted towards reducing their impact. While the mitigation is welcome, the coalition stress the money could be more effectively spent on initiatives to prevent homelessness from happening in the first place.

The intervention comes as annual figures released last month showed homelessness and rough sleeping continuing to rise in Scotland and follows pledges by Andy Burnham to end homelessness across the UK. While in opposition the Chancellor spoke out against policies like the bedroom tax which he described as “callous, reckless and heartless.”

With the Scottish Government recently announcing £115 million of investment in Discretionary Housing Payments which includes payments to mitigate the impact of the three policies, the coalition has pointed to the success of a recent £1million prevention fund as an example of how the money could be better spent. 

The prevention fund ran for one year in Scotland, preventing 662 cases of homelessness and resulting in almost £10million of avoided costs. The coalition says that scrapping the policies would remove the need for mitigation measures, freeing up further funding which it would press the Scottish Government to divert towards wider prevention measures.

Maggie Brünjes, Chief Executive of Homeless Network Scotland said:

“Housing policy is devolved to the Scottish Parliament but the reality is that the benefit cap, the bedroom tax and the local housing allowance freeze are UK-wide policies which increase the risk of homelessness and which only Ministers in Westminster have the power to end. 

“Andy Burnham has spoken strongly about his determination to end homelessness across all of the UK, while the Chancellor has previously described policies like the bedroom tax as ‘callous.’ They now both have the chance next week to show that there is real intent behind the rhetoric and scrap these damaging measures.

"While it is welcome to see the Scottish Government mitigating the impact of these policies, it makes little financial sense for a government in one part of the UK to spend millions of pounds of taypayers’ money reducing the impact of policies imposed by a government in another part, while Ministers in both parliaments stress their ambition to end homelessness. 

“Across Scotland, families are struggling to cover their rent, record numbers of children are living in temporary accommodation and rough sleeping is rising. This is funding that could instead help us scale up the proven approaches that we know can prevent people from losing their homes in the first place.

“Next week the Chancellor has an opportunity to demonstrate he will match rhetoric with action by using his first Budget to scrap these policies and help families across Scotland keep a roof over their heads.”