Government adversely affecting delivery of homes for vulnerable people

// HA News

Housing associations providing vital supported, sheltered and extra care housing have had to slash plans to build new homes, down from 8,800 to 1,350 units, according to a new survey.

This follows months of concern generated by Government plans to review the funding for these services, which the sector and leading parliamentarians believe will not work. A Green Paper, expected to detail the proposals, was due before the summer but has now been delayed until the end of autumn. 

A total of 69 housing associations, which together deliver a third of supported and sheltered homes in England, responded to the survey. Supported housing provides a secure, safe place for the most vulnerable, a majority of whom are older people or people with long-term disabilities, saving the taxpayer around £3.5bn in NHS costs.

The Government’s indecision has left residents and housing associations with little certainty about their future income, and some boards have had to make difficult decisions. For example:

  • 71 new schemes, representing 2,185 homes, have been postponed
  • 19 new developments, totalling 803 homes, have been cancelled
  • 22 existing supported schemes and 3 sheltered schemes, amounting to 132 homes, are facing closure.

The main factors for these closures and delays relate to the uncertainty about the Government’s proposed funding model and the withdrawal of funding for support services.

Where schemes are going ahead, two key reasons were cited; 24% estimate the local cap on housing benefits would be high enough in their area to cover their costs, followed by 18% who believe their shortfall would be offset by sufficient government funding.

The five-year cumulative cost to the taxpayer of failing to make up the existing shortfall of these specialist homes is estimated at £2.72bn.

Housing associations made a strong case for an alternative model that addresses concerns about how the money will be allocated and how long it will be available for. It was endorsed by a joint select committee of MPs, who recognised that the basis for the new system was not “a competent starting point” given it is based on the specific circumstances of the private rented market.

David Orr, Chief Executive at the National Housing Federation, says “These findings really bring it home: changes to supported housing funding are stopping building for the most vulnerable. Housing associations know first-hand that the proposed funding model will not work – a view backed by a joint select committee – and yet Government has failed to heed warnings.

“With social care in crisis, the role supported housing plays in alleviating pressures on the NHS is ever more important. These changes have not even come in yet and they have taken 7,000 homes for vulnerable people out of the pipeline.

“The proposed changes in funding bear no relation to the real cost of providing this type of housing. It is time Government put supported housing on a secure and sustainable footing.” 

John Glenton, Riverside’s Executive Director of Care and Support, who gave evidence at Westminster on the issue, concluded “Landlords like us have strong partnerships with local authorities, and are poised to begin developing much-needed additional supported housing. While this uncertainty over funding continues, a question mark hangs over development plans which would support some of society’s most vulnerable people. Along with other landlords, we urge the government to resolve this quickly.”

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