And it’s totally a political choice. They could easily afford to make sure no-one had to live in these conditions. They just don’t want to. Keeping a pool of people desperate for any scraps of work serves them much better.
I’ve got a book from the 70s, which is basically a guide to living the counter-cultural life in London at the time. I got it out recently, because it has loads of prices and cost of living stuff, and a friend wanted some figures for research about the era. It’s got a page about what you’d get on the dole at the time. What you got for dole + housing benefit easily covered rent, decent groceries, utilities, a travel card and a bit of money for fun. There was also info about what you could earn for temp work, and two nights working in a restaurant would pay your week’s rent in London. And this was just before we had to get bailed out by the IMF.
It’s 100% a political choice.