Government exempts care leavers from housing benefit cap

In a statement to Parliament, Work and Pensions Secretary Damien Green said the local housing allowance cap, which comes into force in social housing from April 2018, will not cover those living in supported housing.

The exemption applies until 2019 to care leavers as well as those in women's refuges and homeless shelters. After that date the exemption is set to continue as part of a new funding model for supported housing.

Green said the proposed funding model, which will be subject to a consultation over the coming months, will be ringfenced and handed to councils to protect those in supported accommodation from the cap.

He said the decision to ensure care leavers and other vulnerable people in supporting housing were exempt from the cap was taken after "extensive engagement with stakeholders and charities".

"Our new funding model will help those people who need it the most," Green added.

The announcement ended months of uncertainty over whether some of the most vulnerable young people would lose their homes as a result of the cap being introduced.

The decision was welcomed by Denise Hatton, chief executive of YMCA England.

She said: "Supported housing providers have been in a state of uncertainty since the initial announcement was made in last year's Autumn Statement and it is, therefore, positive to see greater clarity going forward.

"YMCA also welcomes the announcement that government will ringfence the budgets being devolved to local authorities. We will be looking to work further with government on any new arrangement to ensure the money ultimately ends up supporting young people to have a safe and secure place to live."

In June, the Care Leavers' Association and Local Government Association warned that a failure to exclude care leavers from the cap would lead to an increase in homelessness among young people.