The economic downturn and the government's deep cuts to welfare will drive up homelessness over the next few years, raising the spectre of middle class people living on the streets, a major study warns.

The report by the homelessness charity Crisis, seen by the Guardian, says there is a direct link between the downturn and rising homelessness as cuts to services and draconian changes to benefits shred the traditional welfare safety net.

In the 120-page study, co-authored by academics at the University of York and Heriot-Watt University, Crisis highlights figures released over the summer which show councils have reported 44,160 people accepted as homeless and placed in social housing, an increase of 10% on the previous year and the first increase in almost a decade.

Last year another 189,000 people were also placed in temporary accommodation – such as small hotels and B&Bs – to prevent them from becoming homeless, an increase of 14% on the previous year.

Crisis says that with no sign of economic recovery in sight, there are already signs that homelessness is returning to British streets. In London, rough sleeping, the most visible form of homelessness, rose by 8% last year. Strikingly, more than half of the capital's 3,600 rough sleepers are now not UK citizens: most are migrants from eastern Europe who cannot find work and, unable to get benefits or return home, are left to fend for themselves on the streets.

The charity says the evidence is that the current recession has seen the poor suffer the most, but other parts of society may be in jeopardy if the government's radical welfare agenda is acted on as the economy stutters.

"Any significant reduction of the welfare safety net in the UK as a result of coalition reforms may, of course, bring the scenario of middle class homelessness that much closer," the report states.

Living beyond your means is pretty much the norm in Britain now. I'm "only" 41 but I seem to be at the very end of the last generation that believed in saving up for stuff rather than borrowing. I have only ever borrowed for my house, my education and my first car - things I could easily justify at the time (an Oxford education was a lot cheaper 23 years ago, I couldn't justify it today). I would never borrow for a luxury; I save for it and buy it if and when I can afford it. I simply couldn't enjoy a holiday or other gratuitous expense that I know I'd spend the next umpteen years paying for and might potentially cost me me home.

I do understand that many people are much worse off than me, but they are most definitely "hard up" rather than "middle class" whatever their aspirations or backgrounds may be. Ironic that so many of them have brand new furniture on credit, while I'm happy with my skip suite.

There are a lot of people who live a "middle class" lifestyle, while in reality they are one pay-cheque or debt-collector removed from destitution.

Living beyond your means is pretty much the norm in Britain now. I'm "only" 41 but I seem to be at the very end of the last generation that believed in saving up for stuff rather than borrowing. I have only ever borrowed for my house, my education and my first car - things I could easily justify at the time (an Oxford education was a lot cheaper 23 years ago, I couldn't justify it today). I would never borrow for a luxury; I save for it and buy it if and when I can afford it. I simply couldn't enjoy a holiday or other gratuitous expense that I know I'd spend the next umpteen years paying for and might potentially cost me me home.

I do understand that many people are much worse off than me, but they are most definitely "hard up" rather than "middle class" whatever their aspirations or backgrounds may be. Ironic that so many of them have brand new furniture on credit, while I'm happy with my skip suite.

As you said many are only a pay cheque from destitution and that is why so many middle class are at risk. They have paid for the necessities on credit to keep up with the Joneses. What will do them in is the speculation in property as the housing bubble continues to implode. Whatever nest egg that they had accumulated in their homes will evaporate.

<my heart bleeds for them it really does <super sarcasm mode initiated>

Your heart should bleed for anyone who's facing homelessness, regardless of how they got there. If you honestly don't feel sympathy for someone who is now living on the street - with all the dangers and risks that involves - then that would suggest you're a very callous person.

If you are carrying enough debt (excluding mortgage) that would leave you facing homelessness if there was a change in circumstances something has gone very wrong with your budgeting.

+1, except the education, I couldn't afford a university education, I worked my way through college and ended up with about a tenner in my pocket after 3 years in college.


+0.5 I used my savings to buy a new sofa, but I'd have stuck with the old one, until I had saved up for a new one. I wouldn't buy on credit if there was an option.

I saved up for a year to buy my first TV. I went a year without a TV... Then I bought it on 0% interest and left the savings in the bank to earn interest, but there to pay off the loan in an emergency. 0% credit and the money in the bank is the only time I've used credit, and then I've always waited until the loan was paid off, until I splurged the savings on something else.

+1 to the above

I have always been a bit of a pedant over this and have had to “train” both the current SWMBO (and previous ones) that a credit card does not mean you have the money to spend



Obviously, there are emergencies, like the roof leaking or something, where you need to act now and need the money up front, whether you have it, or not, but for "normal" items, I'll always save up first.

There are a lot of people who live a "middle class" lifestyle, while in reality they are one pay-cheque or debt-collector removed from destitution.

Living beyond your means is pretty much the norm in Britain now. I'm "only" 41 but I seem to be at the very end of the last generation that believed in saving up for stuff rather than borrowing. I have only ever borrowed for my house, my education and my first car - things I could easily justify at the time (an Oxford education was a lot cheaper 23 years ago, I couldn't justify it today). I would never borrow for a luxury; I save for it and buy it if and when I can afford it.

Credit is too easy to get. As someone I know once said to me about credit cards - they “take the waiting out of wanting”. We need to look at how personal debt is managed in this country. In the old days, communities (especially working class ones based around factories) would have clubs which you chipped into, and if you were hard up, you could borrow against them. It was a kind of financial social support that we can’t seem to be able to do any more.