Naomi Goode, partner, Lewis Silkin
Housing benefit squeezed
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A recent court ruling has financial implications for social landlords providing supported housing
What does housing benefit cover in supported housing?
Generally housing benefit only meets rent up to the average market rent for accommodation in a particular area. This will be insufficient to cover the higher rents that are charged for supported housing.
Housing providers generally rely on an exemption for accommodation ‘provided by a housing association, a registered charity or voluntary organisation where that body, or a person acting on its behalf, also provides the claimant with care support or supervision’.
Where the exemption applies, housing benefit will meet the full amount of the rent without the average market rent cap.
Has this already caused problems for social landlords?
The 2006 the tribunal case of Turnball/Rivendell dealt a blow to the supported housing sector. The case turned on the meaning of ‘a person acting on its behalf’.
Rivendell Housing Association owned the housing. The care was provided by an organisation called Citizen First. The tribunal held that because the care agreement was between the local authority’s social services department and Citizen First (not between Rivendell and Citizen First), Citizen First was therefore not providing the care and support ‘on behalf of Rivendell’ so the rent fell outside the housing benefit exemption.
What about the new case?
Last month’s court decision of R (S) v Social Security Commission, the Secretary of State for Work and Pensions and Walsall MBC, caps the amount of rent that housing benefit will meet on supported housing schemes, causing financial difficulty for supported housing providers.
The case concerned a tenant with learning difficulties who needed constant care and support. He was an assured tenant of, coincidentally, Rivendell. The local authority entered into a care agreement with Lifeways under which Lifeways contracted to provide care to Rivendell’s tenants. The local authority nominated the tenants to Rivendell.
When the tenant applied for housing benefit, the authority determined that the accommodation was exempt because Lifeways were acting on behalf of Rivendell. However, in light of the Turnball/Rivendell decision, the authority later changed its mind, on grounds that the care and support was not, in fact, being provided ‘on behalf of’ the association.
The tenant sought judicial review, arguing that the expression ‘on its behalf’ should be given a wide interpretation to include the arrangement between the local authority, Rivendell and the care provider
The High Court rejected this argument, holding that the care provider was not providing the care and support ‘on behalf’ of the association.
What can social landlords do?
Social landlords that are not providing care or support themselves, or engaging a care provider to do so, could get around the Walsall decision by contracting in their tenancy agreements to provide the care and support themselves.
However, this would leave social landlords at risk of ending up with liability for the provision of support.
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Readers' comments (1)
Danny Key | 06/11/2009 1:43 pm
In the last paragraph of the article authored by Naomi Goode from Lewis Silkin, 'Housing Benefit Squeezed' it offers the possibility to landlords of including the provision of care and support within their tenancy agreement. It is our opinion that this is inaccurate and has been confirmed as so within the original Rivendell Lake Social Security Commissioner decision as reported as R(H)2/07.
Rivendell Lake did include the provision of care and support as a condition of occupancy, albeit subsequent to the original decision of Sheffield City Council. However it was identified by Commissioner Turnbull that where the care and support was the obligation of someone other than the landlord, i.e. the Local Authority, then the inclusion of the condition of provision within the occupancy agreement did not alter the fact that the care and support had to be legally either provided by, or on behalf of the landlord. Where the provision of care and support is a statutory obligation of the Local Authority and they discharge that duty to a body then it is being provided by that body on behalf of the Local Authority regardless of what is identified within the claimant's occupancy agreement.
There are options to overcome this decision particularly in light of further legal argument relating to exempt accommodation recently published at Upper Tribunal level (see CH 0200 2009 and CH 4432 2006). In relation to this Support Solutions is actively and successfully working with organisations which accommodate and support vulnerable people to comply with the Housing Benefit regulatory framework. This in turn enables them to recoup proper levels of cost recovery through HB to invest in enhanced levels of maintenance, services and management of accommodation for vulnerable people.
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