For 21-year-old Andrew, working hard on his apprenticeship almost didn’t pay off – literally.
The Londoner loved his electrical engineering course – but when the rent in his supported accommodation was hiked, he realised his housing benefit and apprenticeship wages wouldn’t cover it.
“I couldn’t ask for a pay rise, because the money wouldn’t have come to me anyway,” he tells Big Issue. “It was kind of like a double-edged sword.”
Andrew was trapped by what advocates describe as a “cruel quirk” of the benefit system.
Under current rules, young people in supported accommodation can only earn £5 a week before their Housing Benefit starts to be reduced. After that, every extra pound they earn cuts their Housing Benefit by 65 pence.
The impact is stark. Once a young person earns more than £132.78 per week – just 13 hours at the minimum wage for a 21–22-year-old – they are worse off than if they had worked less and retained more housing benefit.
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Centrepoint CEO Seyi Obakin describes this as a “cliff edge”: a system designed to support young people instead traps them in a cycle where work doesn’t pay.
“Every young person deserves the chance to build a life and start a career,” he said. “Young people in supported housing are no different – but time and again they find that the benefit system that should be supporting them into work leaves them struggling to afford the essentials and blocks their ambition.”
Since 2015-16, apprenticeship starts for under-19s have plummeted by 40%. Meanwhile, around 13% of 16- to 24-year-olds – nearly one million – are NEET. Almost half have never had a job.
“I couldn’t work more, because if I work more, I’m gonna have to pay the full rent,” Andrew recalled. “I was very stuck. I was doing something you want to do, especially like learning and working, but I was stuck in this middle ground of there’s no point.”
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Important deadlines started to roll in, and he was failing to meet the hours requirement of his course.
“I’m an apprentice. I don’t have forever to finish my apprenticeship. So my college started to kind of say, ‘Andrew, you know, you’ve got to finish your NVQ’[National Vocational Qualification]. I’m telling them I’m dealing with housing situations.”
“I need to focus on where I’m gonna actually sleep, rather than my apprenticeship. And they’re obviously giving me a bit more time and leeway, but there’s only so much they can do… so it just felt like I was just like, this big burden that’s just kind of like not moving on.”
Andrew moved into supported accommodation with Centrepoint, where rent is capped at a third of earnings. That turned everything around – he finished his qualification and started learning to drive.
“Just kind of being a young person and living a little bit more… my spark came back,” he said.
But without this support, the then-teenager could have failed his course and spiralled into homelessness.
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Freya, 21, has faced similar challenges. She entered care at 16, spent time with a foster carer, and then moved into semi-independent housing while trying to hold down jobs. The benefit trap makes work a difficult choice.
“The more hours you work, the more you’re paying for rent, and the less benefits you get… it makes you stop and think twice about working,” Freya explained.
“You go from having full housing benefits and full Universal Credit to then having to pay some of your rent, which can be quite a lot of like rent… it barely leaves you with anything for food and travel and any other kind of essential thing to sort of be able to look after yourself. It can be quite stressful and overwhelming.”
Up to 30,000 people are stuck in this trap. It might “sound complicated” to the uninitiated – but Obakin says “the government could fix this cruel quirk at the stroke of a pen in the Budget.”
“It would save the taxpayer millions and pave the way for young people to take on work and gain their independence,’ he added.
The government has long promoted its “Get Britain Working” initiative. With nearly a million young people not in education, employment or training (NEET), it’s an urgent goal – but the existing benefits system compromises it.
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Jim Dixon, Labour Member of Parliament for Dartford, defended the government’s approach – but conceded that a rule change would be beneficial.
“I think financially, it makes sense. Clearly, the government has inherited a set of rules from the last government, and they’re slowly working through those rules, which are barriers to getting people into work. We’ve done a lot of work investing in the get Britain Working Agenda,” he told Big Issue.
“[But] this would be something new in terms of the change to the existing rules that I think the government ought to be looking at, and I will be trying to press the government to adopt, if possible.”
Centrepoint is calling for two targeted changes: raising the Housing Benefit earnings disregard from £5 to £57, and reducing the taper rate from 65% to 55%, bringing it in line with Universal Credit. The charity estimates that these reforms could save nearly £13 million in one year, including £5 million in direct fiscal savings.
Most importantly, it could change the lives of tens of thousands of vulnerable young people. Freya dreams of running her own photography business but is currently struggling to get by.
“Being able to do nature photography and wedding photography… basically, I really enjoy photography. At the moment, I’m just basically struggling to survive, and it’s not fun in any way, shape, or form.”
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“I see other people that can live at home with their parents … and it’s just like, what? Why am I doing this if I’m not getting anywhere?”
