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Rough sleepers will receive £3.2m of emergency funding to help them self-isolate during the coronavirus pandemic.
Communities secretary Robert Jenrick said councils would be reimbursed for the cost of providing accommodation and services to homeless people who are suffering from or at risk of Covid-19.
Categories of people at the highest risk from the infection include over-70s, people with certain health conditions and pregnant women.
The funding will be available to all local authorities in England.
Current estimates suggest around 5,000 people sleep rough, and 40,000 people use shelters or hostels, in Great Britain on any given night.
Leading homelessness charities have written to the prime minister calling for those sleeping rough to be recognised as a vulnerable group as the coronavirus outbreak takes hold.
Homeless people should have rapid access to testing and be provided with hotel-style self-contained accommodation with a private bathroom so they can safely isolate themselves, the charities said.
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They have also called on Boris Johnson for assurance that frontline workers in homelessness organisations are recognised as an emergency service, as part of the overall response to Covid-19.
The letter was signed by members of 10 organisations including Crisis, St Mungo’s and Centrepoint.
They said homeless people should be given the means to, at the very least, follow the same social distancing advice as others in the high-risk categories.
Because of homeless people’s pre-existing vulnerabilities, the charities said, they should be treated the same as people who, in the coming days, will be asked to ensure they are “largely shielded from social contact” for around 12 weeks, or possibly longer.
The organisations said government measures for hostels and day centres “fail to provide the much more comprehensive plan and wide-ranging action needed to ensure that everyone facing homelessness is provided with self-contained accommodation, to ensure that they can self-isolate, and that people experiencing financial hardship are not left facing homelessness as a result of the impact of Covid-19″.
They want outreach teams to test people on the streets, in shelter accommodation and hostels for coronavirus, and for people without the virus to be immediately triaged so they can be “supported safely and kept out of communal air space”.
There are now 2,626 coronavirus cases in the UK, up 676 from Tuesday, the biggest rise in cases so far, surpassing Tuesday’s total increase of 407.
The number of deaths officially stood on Tuesday at 71, but newer figures are set to be released on Wednesday.
The news comes as the global coronavirus cases reached 200,000.