Benefit payment disputes leave supported housing providers running on empty
Supported housing rent row sparks care crisis
Councils and supported housing providers across the UK are locked in bitter legal disputes over rent levels which are taking so long to resolve that services are facing closure.
Hundreds of documents obtained under a freedom of information request by extra care and supported housing provider SAF Housing have exposed many cases where local authorities are refusing to provide enough housing benefit to meet rent levels charged by charities and voluntary organisations for supported housing.
They also reveal a number of legal battles lasting for years at a time, during which period providers must fund the difference between the rent level demanded and the housing benefit councils are prepared to provide. Anecdotal evidence suggests some supported housing providers have shut as a result.
Supported housing is exempt from rules limiting benefit payments because it is more expensive to build and maintain, but councils can limit payments to amounts they deem reasonable. The cost of exempt accommodation claims is estimated at between £70 million and £130 million a year.
In some cases councils are effectively accusing providers of attempting to defraud the system.
Darlington Council said: ‘The rules have been exploited by some landlords to gain additional housing benefit for services.’
Bristol Council alleges it has experienced cases where private landlords have tried to ‘exploit’ it by setting up a charitable organisation to generate profits from supported housing.
It says exempt accommodation was set to cost £2.5 million in 2011/12, with an additional risk of £2 million depending on the result of appeals.
Charities argue the rents they set are being backed by tribunal judges. Refuge, which provides hostel and emergency accommodation for domestic violence victims, said it had recently been involved in cases ‘that have taken two years to resolve and where our case was eventually upheld’.
‘This has put the viability of some of our refuges at risk and is in effect an exploitation of the caring nature of specialist charities.’
Community Housing Cymru said it had one decision overturned after an 18-month battle in a process that was ‘stressful for the tenants and costly [to the provider]’.
Margaret Coward, head of housing at Life Housing which provides support to pregnant women and young families, said it was involved in disputes in three council areas which had gone on for as long as ‘a couple of years’.