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Council to ask government for help as it predicts nearly a third of budget will go on homelessness
Worthing Borough Council is planning to ask the government for help as it forecasts spending nearly a third of its yearly budget on temporary accommodation costs.
Worthing Borough Council is planning to ask the government for help as it forecasts spending nearly a third of its yearly budget on temporary accommodation costs #UKhousingThe West Sussex local authority faces overspending on its budget by more than 10% this year, which it blames on ongoing pressures on its homelessness service.
In the first six months of this financial year, 335 local households told the council they were at risk of having nowhere to live, a slight increase on what this figure was last year and a 28% rise on the one before that.
Councillors will be asked to agree exceptional financial support (EFS) from the Ministry of Housing, Communities and Local Government (MHCLG) at a meeting today (9 December).
A press release issued on 5 December claimed that the budget gap has arisen despite the council having made savings by building its own temporary accommodation and making long-term deals with landlords to stop residents having to stay in hotels and B&Bs.
The press release said: “This surge in local people needing support means we have felt forced to approach the MHCLG to request further exceptional financial support to balance its books this year.
“We have also advised MHCLG that unless Worthing benefits from a significant increase in financial support as part of the government’s fair funding review this year, we expect to need additional support in 2026-27 as well.”
A report by Emma Thomas, the council’s interim director for core services, highlighted the “considerable sectoral lobbying” on the temporary accommodation issues faced by councils across the country.
But while the government’s fair funding review methodology aims to direct cash to areas of demand, this is not expected to be enough to plug the council’s funding gap, she added.
It means the council will up its budget for temporary accommodation costs by £1m, more than 5% of its overall revenue budget, in its medium-term financial plan starting in 2026-27.
Ms Thomas also warned that the situation is likely to repeat itself if there is no policy change at Westminster, writing: “It is expected that Worthing will continue to require support through the EFS scheme for the foreseeable future unless there are significant changes in government funding for homelessness.”
Last month, analysis by the Local Government Association found that English councils face a £3bn shortfall by the end of the decade due to limits on temporary accommodation subsidy rates, which are currently capped at 90% of Local Housing Allowance (LHA) rates from 14 years ago.
While uprating this subsidy was a key ask of the sector ahead of the Autumn Budget, ultimately no change was announced by chancellor Rachel Reeves on 26 November.
On that day, however, the Treasury confirmed it would be leading a value for money review of homelessness services, including improving the supply of temporary accommodation.
Last week, the government announced it would spend £8m on temporary accommodation reduction pilots in the 20 councils where the most families are stuck in B&Bs, and would continue this for at least three years.
MPs have also called for an emergency meeting involving councils to help resolve rising temporary accommodation costs.
In Worthing, supported accommodation placements are also placing pressure on council finances, Ms Thomas’ report revealed.
Council officers have also been in talks with MHCLG and the Department for Work and Pensions over pressure from the area’s “disproportionately high” number of supported housing allocations.
The rise in placements over the last three years is said to be due to commissioning decisions from other bodies, the area’s low property prices and the number of suitable buildings.
But the council must cover the cost of this housing, and it does not match the subsidy it is allowed to reclaim which is linked, as with temporary accommodation, to LHA rates from 2011.
While the council has already boosted its service budget by £1m this year to help close the funding gap, the pressure requires “more specific action” which is why it is in communication with central government, Ms Thomas added.
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