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Ministers are caving to ongoing pressure to rethink Universal Credit as it causes issues with housing homeless families.
Universal Credit forces homeless families in short-term accommodation to wait six weeks to qualify for rent support, which is incompatible with the law that requires councils to find more suitable housing for the families within those six weeks.
Local authorities have reported that rent collection for emergency accommodation has collapsed since the Universal Credit digital service started last year.
The Guardian reported that Croydon Council faces a £2.5million rent bill due to families being hosted in Bed & Breakfasts - a burden on the taxpayer that was covered by housing benefit in the old system.