Government confirms supported housing funding shake-up

The ‘one-size-fits-all’ approach has been ditched in favour of local touch after Local Housing Allowance cap scrapped

The government has announced a revamp of their funding strategy for supported housing ­– a week after Theresa May’s dramatic U-turn on the Local Housing Allowance cap.

The Prime Minister decided to scrap the cap on LHA last week and this has been followed up with a vow to make flexible funding for supported housing tailored at a local level.

This government is committed to boosting the supply of new homes, and helping people to live independently and with dignity for as long as possible

The changes will see all long-term housing remain in the welfare system and a proposed ‘sheltered rent’ for extra care housing aims to keep rent and service charge costs down to protect older and vulnerable people.

Local authorities will take on a bigger role in planning for and providing short-term and emergency housing with the government pledging to ring-fence a grant to fund this by April 2020. It is hoped that this cash, underpinned by a National Statement of Expectation, will boost access to secure accommodation for vulnerable people.

Currently supported accommodation is funded through the welfare system alongside housing costs and extra support services. It is essential to ensure that those who are most vulnerable in society remain housed and off the streets.

Whitehall did acknowledge that more homes are required with the country’s ageing population meaning that demand is forecasted to increase. However, they insist that the reforms will ensure funding certainty, encourage long-term investment and new supply of homes as well as giving local areas control over how services provided around their region.

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Local Government Minister Marcus Jones said: “This government is committed to boosting the supply of new homes, and helping people to live independently and with dignity for as long as possible. This is why we are giving the supported housing sector the certainty of funding they need to get building new homes.

“These reforms will deliver quality and value for money, funding certainty for the sector and give local areas a greater role in commissioning services.”

The move has been welcomed by housing campaigners but the use of a local authority grant does raise concerns.

Today’s proposals give the majority of providers and the many vulnerable people who need this vital housing much-needed reassurance following a long and damaging period of uncertainty

But the government has also launched two consultations: one on housing costs for sheltered and extra care accommodation, and one on housing costs for short-term supported accommodation, alongside the published policy on October 31.

David Orr, Chief Executive at the National Housing Federation, said: “I am confident the new system outlined by the government today addresses concerns about the long-term stability of funding for most schemes. This, coupled with assurances about levels of funding and a new timetable of 2020, will give housing associations the certainty they need to keep providing and building these homes.

“The government has provided assurances that automatic entitlement will remain in place for people in short-term services, however we do need to consider the implications of a system where housing costs are paid through a local authority grant. We want to work with the government to ensure users and providers are confident that the entitlement to payment is secure for the long term.”

Chartered Institute of Housing chief executive Terrie Alafat CBE added: “Today’s proposals give the majority of providers and the many vulnerable people who need this vital housing much-needed reassurance following a long and damaging period of uncertainty.

“Though it is reassuring to see that long-term supported housing will continue to be funded by the welfare system, we are concerned the proposals fall quite a way short of what is needed to properly support other vital forms of specialist housing that provide immediate and short-term support to people who have been victims of homelessness or domestic abuse, for example.

“It is imperative that people who need this type of housing are not disadvantaged and we will be making the case for this.”

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