Thursday, 19 January 2017

Supported housing on the brink

Housing leaders are urgently lobbying government to protect specialist housing from a planned welfare cut, which would see mass closures of homes for the most vulnerable.

Associations have put developments on hold, as anxiety grows over the government’s plan to cap housing benefit for new tenants at Local Housing Allowance levels. This is often well below the cost of providing housing for older people, the mentally ill and people with disabilities and would force these schemes to close or seek wealthier tenants.  

Jenny Allen, policy leader at the National Housing Federation, said: “This is an issue of critical importance, with some schemes already on hold. We are continuing to press this with officials and ministers.”

The cap, first announced in the Autumn Statement, would not kick in until 2018, but would affect new tenancies granted from April this year. More than half of associations provide some form of supported housing, and in 2014/15, 110,665 new supported housing tenancies were granted by social landlords.

Andrew Redfern, chief executive of specialist housing association Framework, added: “It would mean the end of supported housing. All our schemes would close, and I think all others would as well.”

Anchor, England’s largest not-for-profit provider of retirement housing, said the change could leave it with a £13m annual hole in its budget.

Great Places, New Charter, Hightown Praetorian and Family Mosaic all confirmed many of their schemes would be unviable if the cut went ahead.

Kevin Beirne, group director of housing care and support at One Housing Group, said it was reviewing the 520 extra care homes it is currently building and could “mothball” them if it does not receive confirmation of an exemption soon.

High level talks with the Departments of Health, Communities and Local Government, Work and Pensions and the Treasury are ongoing. 

Research by the Placeshapers group of housing associations last month estimated the cap would leave a £400m gap in supported housing funding, with further “huge losses” if older people’s homes were not exempt.

A government spokesperson said it is “working on the detailed design of the policy”.

It has offered to increase Discretionary Housing Payment budgets by £70m in 2018/19 and 2019/20 to help affected tenants. Landlords have warned this would be insufficient.

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