The average added cost of exempt and supported accommodation is between £7.89 and £14.66 per week.
A definitive statement you may think but derived using the DWPs own figures from the research report they issued earlier this year and constantly referred to in this consultation paper. Page 80 of this states that this ‘added cost’ is between £70m and £130m per year and that exempt and supported accommodation (ESA) has 170,000 residents. Divide £130m by 170,000 ESA rents and you get a weekly cost of £14.66. Likewise divide £70m by 170,000 ESA rents and you get £7.89 per week.
All 3 proposals outlined above see a replacement with LHA or LHA plus an extra amount (LHA+) yet the overall figures give no financial room for LHA+ at all. In fact LHA+ is likely to see the overall bill increase and is therefore not a viable option in this alleged ‘cost-neutral’ set of proposals.
The DWP believes that as ‘service charges’ have increased that supported housing providers are sneaking support costs back into HB. A position they have an absolute right to look at as does any government. Yet it also concedes that there is a higher level of housing management in all ESA provision and as we have seen the cost of that is between £7.89 and £14.66. Average support costs nationally are known by central and local government through SP and using that as a benchmark the ESA added cost equates to less than one hour per week.
So the average ‘intensive’ housing management that ESA provision holds, and DWP agrees it needs to hold, is paid currently in HB at less than one hour per ESA rent per week. The DWP paper asks if ESA charges are reasonable. Again a perfectly legitimate question for any funder to ask, yet when all the ‘added costs’ come down to 30 minutes to an hour per week extra, and that ‘added cost’ reflects the need to include furnished accommodation cost, higher wear and tear cost, higher repair cost, higher cyclical maintenance cost, increased safety and security cost, increased health and safety standards and cost, staffing presence and cost, and intensive housing management tasks and costs, we can see that in total it is very cost effective currently and CANNOT include cost for hidden support.
It is self-evident that DWP has little idea of what value it is currently getting in the current HB system which must by the above figures be UNDER funded to reflect its true full and intensive housing management cost. There is also no way financially to sweep money away from hostel, refuge, foyer and sheltered housing cost to pay for increased support costs for disabled or other ‘specialist’ provision as DWP calls this group and keep this cost neutral – overall funding would have to increase