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Govt to pay £70m cost of temporary accommodation for UC claimants

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The way universal credit claimants in temporary accommodation receive support will be changed in a move the government says will save councils £70m.

In a series of changes to the flagship policy published alongside yesterday’s Budget, the government has also acted to head off warnings that new claimants could be left destitute over Christmas and extended the roll out of the new benefit system by three months.

In a statement to the House of Commons this afternoon work and pensions secretary David Gauke said: “In a short-term measure we will change how claimants in temporary accommodation receive support for their housing costs to ensure local authorities can recover more of their costs and can therefore continue to offer this valuable support to those who need it most.”

Under the plan, councils will be able to claim back 80% of the costs of supporting people in emergency and temporary accommodation directly from the Department of Work & Pensions. The DWP says this will save councils £70m in 2018-19.

Mr Gauke said the government would also consider a long-term solution to the issue, which councils say has created a significant additional financial burden due to the difficulty of recovering costs of emergency temporary accommodation from universal credit claimants and the growing number of evictions of claimants by private sector landlords.

Yesterday the chancellor announced measures aimed at addressing concerns over the roll out of universal credit, including reducing the six-week waiting time for payments to five-weeks from February and changes to the system of advances aimed at preventing people falling into hardship.

Under the changes, from January claimants will be able to access an advance of up to a month’s worth of the benefit within five days of making a claim. The period in which the advance must be paid back was increased from six to 12 months.

Claimants in December will receive 50% of their monthly entitlement immediately, with a further 50% paid in the new year. This follows warnings from MPs that individuals making a claim for the first time in December would be left without any money at Christmas due to the wait for payment.

From April claimants already receiving support with housing costs will continue to receive this for two weeks after their claims. This follows evidence of a significant rise in arrears in areas where universal credit has been rolled out.

As a result of the changes the government said it will roll out universal credit more gradually between February and April next year, and include all jobcentres by December 2018, rather than September as previously planned.

During his Commons statement today, Mr Gauke said: “We have a clear objective to ensure as many people as possible get the opportunity to work, to maximise their potential to better their circumstances.

“We will continue to roll out universal credit in a considered and steady manner and in doing so deliver welfare reform that positively transforms people’s lives.”

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