Government Issue Statement On Funding For Supported Housing

A new funding model for the provision of supported housing (which includes women’s refuges, homeless shelters and housing for those leaving care) has been outlined by the Department for Works and Pensions (DWP).

Supported housing will continue to be exempt from the Local Housing Allowance (LHA) cap until 2019. From then the new funding model will protect the sector from the cap with a top up of additional ring-fenced funding. The amount of top-up funding will be set on the basis of current projections of future need.

According to the DWP the new ring-fenced money will give local authorities greater flexibility to commission services in line with local needs. The government will be consulting with the supported housing sector over the details of the funding model in the coming months. The government also announced that benefit claimants in supported accommodation will be exempt from the lower shared accommodation rate, in recognition of the vulnerable nature of many of their residents.

Work and Pensions Secretary, Damian Green, said: “We know the valuable role that these organisations play in communities across Britain. Women’s refuges or housing for young people with learning disabilities are important parts of the support system for vulnerable people.

“The new model will mean Housing Benefit and the housing element of Universal Credit will focus on paying for core housing costs, while still ensuring the sector is protected from the Local Housing Allowance cap.”

All well and good.

However, also included in the statement is confirmation of the government’s determination to press ahead with an annual, rolling 1% reduction in the rent payments for three years. Supported accommodation services are mostly funded by housing benefit payments and the DWP would cut the rent that supported housing providers can claim back from the benefits system.

Howard Sinclair, the chief executive of St Mungo’s, told The Independent the cut would leave the homeless charity with £3 million a year less to spend on services. “The rent reduction will threaten the financial viability of some of our hostels and other supported housing schemes and offers no direct benefit to vulnerable tenants who mostly rely on housing benefit to cover their housing costs,” he said.

“We urge ministers to honour their commitments to ensure the sustainability of supported housing provision and protect services for vulnerable individuals by taking the rent reduction off the table. There should be no rent cuts imposed for supported housing services in the run up to the new funding regime.”

Damian Green said in the statement that charities had to make “efficiency savings”. “It is important that providers can continue to provide high-quality and cost-effective supported housing to meet the needs of their tenants. However, it is also important that supported housing should make efficiency savings in the same way as the rest of the social sector.”

You can read the full statement here: http://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2016-09-15/HCWS154/