Czechia: giving homeless people 100,000 crowns saves money

The Czech charity Neposeda and researchers from Charles University have found that the state spends an average of around 200,000 crowns a year on a single homeless person — and that the most expensive option for the budget is to do nothing at all. That's the conclusion of the experimental New Leaf project, which gave 40 homeless people in Czechia 100,000 crowns each with no strings attached.

How the experiment worked

New Leaf, inspired by a similar trial in Canada, ran from the summer of 2024 to the end of 2025. Participants were split into several groups: 40 people received 100,000 crowns to spend as they wished, another 20 were assigned a personal social worker instead of money, and a control group of 40 received no extra help at all. In total, 99 people took part in the study — one participant died of a serious illness shortly after the project began.

The researchers deliberately selected people who had been living on the street for a relatively short time — up to two and a half years — because they specifically wanted to test early intervention tools.

What a homeless person costs the state

“The stereotype is that homeless people are lazy and live off benefits, but in our calculations the biggest item by far is emergency medical care,” says Melani Zajícová, head of research and innovation at Neposeda and head of the social work department at the Faculty of Arts of Charles University. According to her, homeless people actually receive almost no benefits.

The calculations show that almost 43% of the costs go on medical care, a quarter on low-threshold centres that serve as safe spaces for homeless people, and a further 9% (more than 18,000 crowns a year) is effectively spent on police work dealing with homeless people.

The researchers describe their method like this: participants were asked which services they used and whether they had contact with the authorities — from ambulance callouts and hospital treatment to outpatient care, social services and the police — and their answers were then matched against official tariffs, ambulance price lists and social services' annual reports.

Neposeda's director and the project's investor, Jana Hamplová, notes that real-world healthcare costs could be even higher: the study only covered people who had been on the street for up to two and a half years, and the longer someone is homeless, the worse their health gets and the higher the bill. Three months in hospital, for instance, costs the state more than 124,000 crowns.

Why helping is cheaper than doing nothing

According to the latest count by the Ministry of Labour and Social Affairs, there were 11,641 homeless people in Czechia last year, and the state's direct spending on them comes to around 2.33 billion crowns a year.

Breaking the figures down by group: an average homeless person's healthcare costs run to 85,600 crowns a year. For the group with a social worker, that fell by 19,512 crowns, and for the group that also received the 100,000 crowns, it fell by 20,924 crowns. “Scaled up across the whole country, that could mean savings of up to 175 million crowns a year,” Zajícová notes.

Back in spring, the researchers reported that 80% of participants who received support had found housing during the observation period, and 58% of those had managed to keep it. According to Zajícová, the results show that a one-off cash payment to homeless people works, so it's already worth discussing a separate “homelessness benefit.” “We've seen the effect, and it's logical to ask whether a one-off payment could be a solution — within the current system or as a completely new measure,” she says, while acknowledging that a sample of 99 people is too small and the result needs to be tested on a larger dataset.

Hamplová is more skeptical about the idea: “What we did with the money is pure utopia in Czechia. Even in some Western countries it's a struggle when they're just starting out with this. But in developing countries, Kenya for example, it's already been working for several years” — although, she says, much smaller sums are enough there, and there isn't the kind of oversight system that exists in Czechia.

What the homeless spent the money on

Another finding of the study is that the money didn't push people towards drinking or drugs. Before joining the project, homeless participants spent an average of 200 crowns a week on alcohol and 205 crowns on drugs. After the experiment began, alcohol spending rose to 311 crowns a week, while drug spending fell to zero. Spending on clothes, housing and food rose noticeably.

In the first month, participants who received the 100,000-crown payment spent 1,858 crowns more on food, 6,000 crowns more on housing and 10,165 crowns more on clothes than the control group. “People are judged by their clothes, after all,” Zajícová comments, explaining that clean clothing is the first barrier on the way to a job or housing.

Overall, the study debunks common stereotypes: financial support didn't increase alcohol consumption, and participants didn't quit working.

Source: seznamzpravy.cz