Associations blame situation on stagnant council fees
24% of providers can’t afford to renew contracts
Almost a quarter of supported housing providers are considering not bidding to provide some of their existing services when their contracts end.
A survey of 130 housing associations by the National Housing Federation found 24 per cent of those questioned had either decided or were considering not bidding to continue to provide existing services.
The survey said the amount councils paid housing associations to provide supported housing had not increased in line with their costs.
Over 30 per cent of associations said they had received no increase in contract price in 2007/08 compared with just over 21 per cent of organisations in 2008/9 and nearly 29 per cent in 2009/10.
Councils paid associations 2.2 per cent more in 2007/8, 1.9 per cent more in 2008/9 and associations expected a 1.9 per cent increase in 2009/10. However, average earnings rose by 3 per cent in 2007, 3.7 per cent in 2008 and 4.8 per cent in 2009, while retail price index inflation rose by 4.3 in 2007 and 4 per cent in 2008 and 0.3 per cent in the year to November 2009.
Nearly half of supported housing contacts will end this year and many will be retendered. More than a third of respondents said they had contracts in place for less than three years.
The National Housing Federation has written to Lord McKenzie, the minister responsible for the Supporting People programme, pressing him to continue to tell councils how much Supporting People funding they get - even though it is part of a lump-sum paid to councils covering a wide range of services. The NHF is concerned that councils could use the money to pay for other services.
Helen Williams, assistant director for neighbourhoods at the NHF, said a future concern was that housing associations might decide to build fewer new supported housing schemes because of uncertainties over whether they would get enough funding to run services within the buildings.
She said: ‘We have real concerns about achieving funding levels for vulnerable people that ensure the range and quality of services our sector wants to deliver.’
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Readers' comments (5)
Joe Halewood | 08/01/2010 10:56 am
The headline is a misnomer and in fact underestimates the scale of the problem.
Correctly, it should be that 24% of one type of supported housing provider (ie RSLs) cant afford to renew contracts. Small specialist charities - another key support provider type - are struggling far more than RSLs due to support being their only activity and SP their majority if not exclusive income source.
All other types of support providers, including council owned services, are also suffering the redution in income as well.
When one considers that the global SP budget paid for 200,000 less vulnerable persons to be supported after the first 3 years, the reality of continued falls in funding to all providers in real and actual terms will only lead to less vulnerable people being supported and, as this dimension obviates. more providers withdrawing from the market.
When that is coupled with the ringfence removal, that threatens to significantly reduce funding spending on support in global terms, the reality is stark.
Scratch under the service and its easy to see that councils who control the budgets may well favour in-house (ie council) support services over RSL providers and small charitable ones, and probably in that order too. And that cynicism assumes that in-house council support services dont lose out to other non-support services such as care that councils have a duty to provide.
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Melvin Bone | 08/01/2010 11:41 am
'Almost a quarter of supported housing providers are considering not bidding'
They do not HAVE to bid....
If they do not put a bid in someone else will probably bid and get the work...What is the problem here?
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Joe Halewood | 08/01/2010 11:51 am
As an addendum the misnomer of the headline could suggest that 76% of RSLs CAN afford to renew leading to wrong assumptions in the eyes of commissioners and councils.
One could see this being synomous in commisioners eyes as (a) 76% of all prices to all providers are now correct; (b) the 24% must be over costed and profiteering; (c) we have a 76% approval rate for the massive cuts we have made...after all it is public money blah blah blah.
And this could apply to all commissioners not just in the eyes of those inept commissioners that have rushed to commmission floating support services that can cost 100% more (according to official figures) and provide an inferior quality and nature of service - the same commisioners that cant see this as the reason why 200,000 vulneable people had support services withdrawn or decommissioned, or almost one in six (again official figures.)
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Joe Halewood | 08/01/2010 12:08 pm
By the way just checked original official SP figures from 2003 and RSLs accounted for 36% of original providers (hence this means 24% of them means about 9% of all providers)
Melvin, the problems are many.
Firstly, despite the pressures that RSLs can place on councils budgets some 200,000 fewer vulnerable people ended up being supported after 3 years.
Secondly, and linked, it is the support providers who are aware of the scale of support need and not councils.
Thirdly, and linked to second point, administering councils in SP have often by social service depts - ie depts with no housing stock and no housing experience deciding who gets housing related support (another great central govt decision based on ease of administration rather than need.)
Fourthly, and linked to all, if (a) you dont know what housing related support is, (b) believe that accommodation-based support is in pronciple wrong (funding should follow the person etc), (c) fund its inferior alternative - floating support even though it costs far more and is inferior, (d) these policies have so far cost at least 200,000 vulnerable people their valued and needed support, (e) you erroneously believe this is cost-effective, as (f) providers flee the market meaning reduction of supply doesnt lead to higher cost...and have other 'priorities' to spend this now unringfenced monies on, such as care budget deficits (or even buying more slat for the roads) then you can simply do that and bugger vulnerable people even further
If you want another 50 reasons please ask!
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disheartened | 18/01/2010 3:42 pm
Maybe part of the problem is that 'SP' has begun to represent 'Supporting Paperwork' and not its former name! They seem to have lost the drive to provide funding to help the actual end service user but desire to make providers lives that difficult they do not want to bid!
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