Temporary housing company ‘could save council £10m a year’

COUNCIL chiefs have decided to set up a second publiclyowned housing company for Bristol, specifically to stem the flow of millions of pounds to private companies who provide temporary or emergency housing for people.

The new housing company would be set up by Bristol City Council to provide that temporary housing for people who face homelessness, instead of the council paying millions of pounds every year to emergency housing providers, private landlords and hotels to keep people off the streets. Council chiefs said that the new company could end up saving council taxpayers up to £10 million a year if the authority was able to use this subsidiary company instead of having to pay emergency accommodation providers. With the housing crisis intensifying, more and more people are finding themselves facing homelessness and turning to the council for support. The council has a legal duty to house everyone from Bristol who is legally homeless and vulnerable and since the Covid pandemic, with rents spiralling and the lack of affordable homes increasing, the number of households – that could be individuals, couples or families – who end up in temporary accommodation has grown to 1,400.

Many of these people are put up in hotels in Bristol, or one of the many temporary or emergency accommodation bedsits, rooms or flats provided by private landlords, companies and ‘Registered Providers’ who the council signs contracts with each year.

The local authority has to pay them to house those people, and currently that is costing the council millions of pounds a year. The biggest bill the council has to pay is when someone is suddenly homeless and because there is not enough emergency housing that’s empty at any one time, the council has to pay what it calls ‘spot price’ to make sure they have a roof over their head that night and for the next few weeks – and that could be in a hotel or an Airbnb, or in a House in Multiple Occupation bedsit rented out by a private landlord.

The council receives housing benefit from the Government to help pay for this, but most of the temporary accommodation costs far more than that – up to £450 a week more than the council gets from the Government.

That means the annual bill is more than £12 million and rising, so the council said it is working with some of the emergency accommodation providers to create more supported housing units, but even the 300 that are in the pipeline won’t be enough.

So instead, the council’s new housing company – the second after Goram Homes was created five years ago – would become its own temporary accommodation provider, with the council using the new company to provide emergency housing, instead of the private landlords. The reliance on private sector provision to meet temporary accommodation or other supported housing provision is an underlying factor in the escalating cost of meeting the needs of the city’s most vulnerable citizens, linked to housing benefit rules and market forces,” a council spokesperson explained.

“The creation of a council-owned not-for-profit Registered Provider has the potential to provide much-needed additional capacity to the existing supply by delivering both exempt rent and other models of specialist and supported housing. If the council establishes a registered provider and directs its activity towards addressing the subsidy loss incurred by placing homeless households in private sector temporary accommodation, the levels of potential savings would be substantial. A programme of Temporary Social Housing commissioning that replaces the spot and block purchase of temporary accommodation has the potential to save the council up to £12.2m a year in subsidy loss, would incur £2.6m in support costs, giving a net saving of £9.6m a year,” he added.