Londoner Leo Alexander insisted that for some under-25s, housing benefit is "a necessity".
He left home at 18 due to family breakdown and said the money he receives goes straight towards subsidising the cost of the hostel he lives in.
"It's kind of like a lifeline for a young person who leaves home with things like family breakdown or suffering domestic abuse," he said.
George Osborne today said that he would "look at housing benefits for the under-25s."
"There are plenty of people listening to this programme who can’t afford to move out of their home, but there are people on benefits who can get housing benefit under the age of 25," he told BBC Radio 4.
Deputy Prime Minister Nick Clegg said Conservatives were making a "monumental mistake" by imposing "cuts for cuts' sake" and trying to place all the burden of deficit reduction on the working-age poor.
"On the right, you've got a Conservative Party now who are driven, it seems to me, by two very clear ideological impulses," Mr Clegg told a Westminster press conference today.
"One is to remorselessly pare back the state, for ideological reasons just cut back the state.
"Secondly, and I think they are making a monumental mistake in doing so, they have said that the only section of society which will bear the burden of further fiscal consolidation are the working-age poor - those dependent on welfare."
Rifts at the heart of the coalition Government have been laid bare as Chancellor George Osborne set out plans for a "permanently smaller" welfare system, with a further £25 billion slashed off state spending - including £12 billion of new cuts to benefits following next year's general election.
"I can tell you today that, on the Treasury's current forecasts, £12 billion of further welfare cuts are needed in the first two years of the next Parliament," Osborne said.
"That's how to reduce the deficit without even faster cuts to Government departments, or big tax rises on people."
Deputy Prime Minister Nick Clegg has challenged the Conservatives to deliver a £140 income tax cut to 20 million workers by scrapping Tory plans for tax breaks for married couples and employee shareholders.
Mr Clegg wants Chancellor George Osborne to use his Budget on March 19 to increase the main income tax allowance to £10,500 in what he calls a "workers' bonus" which would slash around £100 from the bills of basic-rate taxpayers and take some low-paid workers out of income tax altogether.
Now he has said the threshold below which earnings are not liable to income tax could be raised further to £10,700 - increasing the potential saving to £140 - if the Conservatives agreed to ditch "pet tax projects" like the married couples' tax allowance.
Shadow chancellor Ed Balls has said that the Tories should back Labour's "compulsory jobs guarantee for young people".
In responding to George Osborne’s speech on the economy, he added: "George Osborne is desperate to stop talking about the cost-of-living crisis on his watch."
"The Tories should back our compulsory jobs guarantee for young people and the long-term unemployed.
"And in tough times it cannot be a priority to continue paying the winter fuel allowance to the richest five per cent of pensioners."
Britain is "back in control of its destiny," Chancellor George Osborne said in a speech at a car parts manufacturing firm in Birmingham.
"The rest of the world sees that Britain is a country where we’re now back in control of our destiny, a country where we’re supporting business, that jobs – like the ones here today - are being created across our country," he said.
"But if our country is badly run, if the finances are in a mess, and costs go up, and businesses don’t feel welcome, then jobs would quickly disappear from Britain again."
Benefits for young people will be targeted by the Tories as they seek to cut another £25 billion off public spending, George Osborne has indicated.
The Chancellor's comments came as he played down the prospect of means-testing handouts for pensioners, such as winter fuel payments and free television licences.
But he insisted "substantial" savings would still be needed from welfare after the general election to eradicate the deficit.
Speaking on BBC Radio 4's Today programme, he said : "We haven't written our manifesto yet, but if you were going to be looking for savings in welfare, pensioner benefits is not the place I would first turn to. I would look at housing benefit for the under-25s.
– Chris Leslie, Shadow chief secretary to the Treasury
George Osborne should admit his policies have failed and led to a cost-of-living crisis.
While millions of ordinary working people are worse off under the Tories, he and David Cameron are paving the way for yet another top rate tax cut for millionaires.
The reason more spending cuts are needed after 2015 is because his failure on growth and living standards since 2010 has led to his failure to balance the books.
Manufacturers expect an improved outlook this year which should lead to growth in exports and more investment in jobs, according to a new report.
A survey of 200 senior executives by EEF, the manufacturers' organisation and Aldermore Bank found a more positive outlook than the muted picture of a year ago, with growth expected in all markets and across all sectors and sizes of companies.
Two fifths of companies said they plan to invest in the UK, with a further fifth saying their investment would be significant.
EEF chief executive Terry Scuoler said: "Manufacturers are telling us they expect to make a greater contribution to growth, investment and jobs this year".