From 2019/20, a new funding model for supported housing is to be
introduced. Ministers said this will ensure that the sector
continues to be funded at current levels taking in to account the
effect of the government policy on social sector rents.
Shortly before the dissolution of Parliament, the Work and
Pensions and Communities and Local Government Committees concluded,
in a joint report on the future of supported
housing, that the government should scrap plans to base rent
allowances for supported housing tenants on rates used for
claimants in the private rented sector.
The Committees report, published on 1 May, says it is
inappropriate to use the Local Housing Allowance (LHA) rate and
argue that a new Supported Housing Allowance, banded to reflect the
actual cost of provision in the sector, should be introduced
instead. The Committees note concerns that the proposed reform
could lead to a serious shortfall in the availability of supported
The report concludes that Ministers are right to consider an
alternative funding mechanism for emergency accommodation, given
the inability of Universal Credit to reflect short-term changes in
circumstance. The Committees recommend grants to local authorities,
which can commission accommodation and pay providers.
It also calls for a separate funding system for women's refuges
and urges the government to work with Women's Aid and providers to
devise it. The Committee says it is essential that refuges are able
to operate as a national network, unrestrained by local admissions
Under the current proposals for supported housing, core rent and
service charges for supported housing tenants would be funded up to
the level of the applicable LHA rate. For costs above this, the
government would devolve ring-fenced top-up funding.
The Committees agreed with the need to find a
long-term, sustainable funding mechanism that ensures quality,
provides value for money, and which protects and boosts the supply
of supported housing. However, they were concerned the government's
funding proposals, as they stand, are unlikely to achieve these
The Committees report also concludes that the
Local Housing Allowance (LHA) rate is an inappropriate starting
point for a new funding mechanism for supported housing. The LHA
rate is a measure for general needs housing in the private rented
sector and bears no necessary relationship to the cost of providing
The Report finds that the cost of provision is largely
consistent across the country, unlike the LHA rate, and
consequently, some areas will rely more on top-up than others. As
this is considered a less secure funding source, the Committees are
also concerned that providers will be put off investing in certain
areas, creating a disparity between the supply of homes and
services across the country.
Read the full report and recommendations.
It will be interesting to see the response of the incoming
Government to the report following the General Election on 8