Housing benefit changes could hit vulnerable the hardest

The government’s recentlyannounced proposals for the future funding of supported housing, however, threaten to change all of that.

First, the good news. The government’s proposals are nowhere near as draconian as those that were threatened by George Osborne last year.

There is even a promise that funding for supported housing will be “maintained at current levels”. In future the core rent of all supported housing will be set at the relevant Local Housing Allowance rate.

It will still be a welfare benefit, and therefore an individual’s entitlement to receiving housing benefit to pay that core rent is still set by statute, and the ultimate cost can still usually be picked up by DWP.

The bad news for local authorities is that administering the service charge element for supported housing could be about to get a whole lot more complicated.

This is because, under the government’s proposals, funding for this element will no longer be a welfare benefit ; it will be a locallyadministered discretionary fund.

Councils will be given a ring- fenced pot of money to meet the cost of service charges in supported housing schemes in their area. They will then have to set up a local scheme to administer and distribute that fund.

This raises the very real prospect of housing benefit teams having to decide on issues of ‘entitlement’, not solely with regard to statute as at present, but with some reference to the funds available – and the limit on that amount.

Imagine, for instance, that existing supported housing providers have to increase their service charges above the level at which the council’s discretionary fund is increased.

The council will no longer be able to meet all of the calls on the fund and so decisions will have to be made about whether to restrict payments across the board, or whether to pay some providers fully, but stop paying others altogether.

But, of course it is also true that supported housing is not a static market.

As our population ages and continues to grow it seems likely that we will need more sheltered housing schemes, for instance.

So councils may need to commission new schemes, or be faced with applications from residents of schemes which landlords have set up to meet those needs.

Assuming that funding is maintained “at current levels” as the government promises, how are the new schemes to have their service charges met? Again, some kind of rationing seems unavoidable.

If this looks an unattractive scenario for local authorities, imagine how it looks to supported housing providers.

Providers run the risk of having their housing benefit income reduced at the whim of council officers, with no recourse to benefit tribunals, as they do at present. This will make future capital funding for much-needed new schemes far more difficult to come by.

It will also make continued engagement in the supported housing sector look very risky.

But if you’re thinking that this might solve the problem by reducing the amount of supported housing available, think again – the government is also considering adding a duty onto local authorities to provide supported housing for those who need it.

For vulnerable people, however, the scenario looks even worse. They could find themselves suddenly having a significant proportion of their housing benefit payments stopped despite having done nothing wrong, and with no change in their circumstances.

There feels to be a real risk that homelessness among this highlyvulnerable group could increase.

Local authorities seem singularly ill-prepared for these changes.

It is therefore imperative that all councils take the opportunity presented by the forthcoming consultation period to comment constructively on these proposals.

Councils need to understand the implications of those proposals for them.

Alan Fraser

There feels to be a real risk that homelessness could increase

is chief executive of YMCA Birmingham