People experiencing homelessness who are given a cash lump sum use the money to invest in themselves and their future, early observations from a ground-breaking research project show.

Rather than ‘wasting’ the money participants in the trial bought furniture and household items for new accommodation or paid for clothes or courses to look for work. Others bought a second hand car to be able to drive their children to school.

In the first evaluation of direct cash transfers in the UK, a total of 250 individuals with recent experience of rough sleeping or staying in temporary accommodation agreed to take part in the research in London and Belfast. This is only the second such evaluation globally, inspired by a similar but smaller project in Vancouver, Canada.

The trial is being run by the Centre for Homelessness's Impact, the UK’s ‘what works’ centre for homelessness, with the evaluation being carried out by researchers at the Policy Institute at King’s College London, which is a global leader in high-quality causal evidence. It has been funded by Citi Foundation and St Martin-in-the-Fields Charity.

As a randomised controlled trial, half of the people taking part have been given an unconditional cash sum of £2,000, which has been transferred into their bank account to spend as they wish. The other half, who were assigned to a control group, will continue to receive support from homelessness charities and other services.

The approach is based on the idea that giving people agency over their own finances increases their likelihood of escaping homelessness for good, while increasing their participation in society and the economy.

Results of the trial are expected to be published early in 2027, based on data analysis of any impact on participants’ housing stability one year after they received the money, which is the primary outcome being evaluated. Researchers will also assess any impact on their housing quality and satisfaction, wellbeing, financial security, social connectedness and contact with public services and the criminal justice system, based on a series of surveys completed by people taking part.

Initial observations, however, show that many participants have used the sum to invest in a better future for themselves.

One man used some of the money to pay off debts and the remainder to furnish a new home, as he moved out of temporary accommodation. A parent bought a car to be able to drop their children off at school and one participant has used the money to fund driving lessons and hopes to buy a car. Another young man also paid off debts and began researching courses to enable him to find work as a plumber.  

One woman said that the money came just at the right time, as she was struggling with childcare costs. For a young person who wasn't able to study at university because they couldn't afford the fees, the money has given them hope to continue pursuing education. 

Other items purchased include children’s clothes and Christmas presents, tickets for a first ever holiday abroad and savings to start a business. One woman said the money had come at the perfect time as she was heavily pregnant and had just been offered a move-on property. 

In a pilot phase of the trial, items purchased included sports equipment, a television, a mobile phone, furniture, gym membership, books and clothes. Several participants gave money or bought gifts for relatives or friends. Three months after receiving the windfall, some people had not spent all of the money and put left-over cash in a bank account as savings.  

So far, there have been no adverse outcomes for participants taking part in this trial. 

Among the inspirations for this research was study in Vancouver, Canada in which a larger cash transfer of $7,500 (about £4,000) was given to 50 people experiencing homelessness. Researchers found that over one year people who received the money spent fewer days homeless, increased their spending and savings with no increase in purchases of ‘temptation goods’ spending, and generated savings for the city via reduced time in shelters.

Ligia Teixeira, Chief Executive of the Centre for Homelessness Impact, said: “Our cash transfers project is rooted in a straightforward yet powerful belief: when people have direct access to resources, they gain agency over their lives and livelihoods. By challenging outdated assumptions about how support is delivered, we hope to see not just immediate relief but real shifts in economic participation, decision-making and resilience.

“We need to ask ourselves what is best for all of us in society. Do we continue to invest in an ever growing crisis system or do we give those at risk even better opportunities to self exit?”

Cash transfers are widely used in low and middle income countries, particularly in sub-Saharan Africa and Latin America, and have a strong evidence base of positive impact in reducing poverty, improving health and nutrition and other outcomes. But there have been fewer programmes that give cash transfers to people affected by homelessness and, until now, none of any scale in the UK. 

Michael Sanders, Professor of Public Policy at King's College London, said: “Evidence from Canada suggests that when people experiencing homelessness get a cash sum they invest in themselves and in their future. This exciting project is testing for the first time and at greater scale whether this approach works to improve outcomes for people affected by homelessness in the UK, and so will add to our knowledge of evidence-based ways to end homelessness.”  

Angie Allgood, Founder and Director of NEWway Project, in Newham, East London, said: 

“We are really proud to be a delivery partner in this ground-breaking research. One of our charity values is empowerment, and we believe that people are often best placed to bring about what they need, in order to effect positive change. This research places agency and personal control at the heart of homelessness interventions. So far, the guests that have received the money have spoken about feeling more optimistic, happier, hopeful and can see a better future. We are excited to see the long term outcomes.”

Ciará Scollay, Head of Service Floating Support & Outreach at·MACS Supporting Children & Young People, said: “At MACS, everything we do is rooted in togetherness and compassion. The Personal Grants project allows us to stand alongside young people with dignity, recognising their strengths and supporting them in practical, meaningful ways. By offering direct financial support alongside our services, we’re empowering young people to make choices that reflect their own goals and circumstances. It’s a purposeful approach that helps build resilience, restores confidence and supports young people to move forward towards independence.”

The delivery partners are Change Please Foundation, Centrepoint, Lambeth Council, MACS Supporting Children and Young People, Micro Rainbow, NEWway Project, Single Homelessness Project and Simon Community Northern Ireland. 

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