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The supported housing cap replacement is even worse
Ministers may have abandoned the cap on housing benefit but they have left supported housing providers at the mercy of hard-pressed councils, says Alan Fraser
When Theresa May announced that the policy of capping housing benefit payments to Local Housing Allowance (LHA) rates for supported housing was being abandoned, everyone assumed that the disaster facing the sector had been averted. Ms May indicated that she wanted a new policy, one that would give supported housing providers the financial security they needed.
It was assumed from this that the austerity-driven policy of George Osborne was being replaced with a more sensible policy that would protect the poorest and most vulnerable. The press and the opposition in parliament announced it as a major U-turn.
“So far from providing greater security of funding, the new proposal removes funding certainty altogether.”
Except that it now appears that, for short-term supported housing at least, it wasn’t a U-turn at all. While it is true that housing benefit payments will no longer be capped, that is only because they are being withdrawn altogether.
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In place of statutory funding, short-term supported housing providers will have to make do with a pot of discretionary funding over which local authorities will have total control. Councils will no longer be required by statute to pay all rents deemed reasonable regardless of their financial position, as they are at present.
Instead, they will be given a fixed pot of money to do with as they see fit. Far from having to use market rent levels as an objective reference point, they will instead be placed under a new statutory duty to secure value for money.
Anyone who had any experience of Supporting People funding knows exactly what that means. They will also be aware exactly how worthless the government’s promise of a ringfence for the funding is. Let us also not forget that we have just secured a new rent guarantee at the Consumer Price Index of inflation plus 1% from 2020 for general needs housing.
Needless to say, there are no guarantees about the future size of the new discretionary pot. So far from providing greater security of funding, the new proposal removes funding certainty altogether. It is, quite literally, even worse than the LHA cap policy (which at least guaranteed funding at LHA levels).
“Statutory funding for short-term supported housing is being withdrawn altogether.”
Not surprisingly, sector figures have been queueing up to denounce the proposals. From Terrie Alafat at the Chartered Institute of Housing, to Denise Hatton at YMCA and Katie Ghose at Women’s Aid, the new policy was met with dismay.
Except at the National Housing Federation. Alone among senior sector figures, David Orr announced that the new policy was “a radical change that could work very well”.
Far from representing a victory for the sector, it represents a crushing defeat – a defeat which has been facilitated and supported by the very organisation that we thought was fighting on our behalf. The supported housing sector deserves better.
Alan Fraser, chief executive, YMCA Birmingham
