You can legally claim benefits whilst street homeless. You give the local jobcentre as your address and presumably check there for post. Although I think UC is almost completely online anyway.
PAYG phones don't need an address attached as there is no contract. Just top up each month (various methods including registering a debit/credit card with the phone service or purchase a voucher from any almost any convenience store, post office or supermarket) to keep your phone package going. If you don't top up then for about 3 months sometimes longer you can still receive calls and your package restarts when you next top up, eventually if you don't top up with phone credit you'll be cut off and your number reassigned to someone else. You could still get a new SIM card for your phone though which costs about £1 and then top up to get the phone package started (the SIM card comes pre-programmed with a package).
Bank account you can use a "care of" address using a friend's address. If no friends, you can use your last address but have the bank mark it as no-paperwork due to a security risk (ID fraud if new tenants/owners get your banking paperwork). UC is paid into the bank account. If you choose you can instead have it paid into a bank account in someone else's name if you trust this person to administer your money for you and not steal it (which they could easily do since it's probably considered "theirs" as it's in their account and even if it's not, you're not taking them to court when you're homeless are you).
You can't claim housing costs if you don't have a tenancy agreement but since she was living with parents it's unlikely she was doing this anyway.
She'll find it very very hard to get accepted onto the councils homeless scheme due to the drug use, there are very few hostels that will accept people with an active drug addiction and even those will be expecting you to take steps to stop and engage with those services that exist to support you in doing so. So basically she isn't going to meet the criteria for any temporary accommodation because she doesn't want to stop and has no intention of stopping. This means she'll probably be considered voluntarily homeless (due to turning down/being kicked out of the temporary accommodation) so then the council has no duty to house her under the homeless scheme.
She can still join the housing register though and bid for properties using her phone data or a library computer (library membership is free but she'll need an address to use, I'm unsure if you need proof you live there). There's also maybe some kind of drop in centre with computers, for use for council flat bidding. She's be much lower down on the housing list if not considered homeless, so would take years (or decades, depending on area) to get anywhere.
You can't take illegal drugs in a council flat, it would be a breach of tenancy, but unless you're involved in other criminal behaviour or antisocial behaviour nobody is actually going to know, if you otherwise look like a semi-functional human being. Taking prescription drugs isn't in itself illegal, even though abusing them isn't good for you, and both your behaviour under the influence (depending on what you get up to) and the means of acquiring them may be illegal. Illegal behaviour can see you evicted for breach of tenancy, especially if convicted.
Realistically, if she's choosing a lifestyle of drugs and living on the streets then that's where she'll remain. Her friends won't take long to get pissed off with her and kick her out, particularly as her addiction worsens and she inevitably steals from them.
There's nothing you can do for someone who won't help themselves.