By John Glenton, Executive Director for Riverside Care and Support.
The National Housing Federation’s ‘Starts at Home’ campaign which launched on Friday (1/9/17) comes at a crucial time for supported housing providers. For not only are we responding to huge increases in the numbers of homeless and older people needing support, we are also in a period of unprecedented uncertainty over whether the services we provide for them in the future will be affordable.
I use the word ‘unprecedented’ with some conviction, having worked in supported housing now for 30 years. Much has changed within the sector over that time and housing associations have played an increasingly central role in developing and delivering good quality people-centred housing and support for those in greatest need. However the potential changes to the way those individuals’ housing and support costs will be funded from 2019, and the regional anomalies that could potentially ensue, threaten the viability of those services to a degree that I could never have imagined.
And make no mistake, the need for such services is growing at pace. Homelessness has more than doubled in the last five years nationally and in some cities such as Manchester it has increased almost ten-fold in the same period. Meanwhile the ‘demographic time bomb’ is ticking ever louder, with people aged 75 plus making up one in seven of the UK population by 2040, whilst the country’s social care system creaks at the seams.
Riverside, like many other supported housing providers, has made a strong case to government to re-think its plans on capping housing benefit for supported housing tenants to local housing allowance rates, the original purpose of which was to control excessive private sector rents.
Our forecasts show that nearly four in five of Riverside’s tenants living in supported and sheltered housing (who claim housing benefit), will see their benefit capped from 2019, with a third of rent and service charge income ‘at risk’ and needing to be met by local top-up funding or, if not available, by tenants themselves.
This excessive shift in funding from welfare to discretionary, cash-limited, local top-up funds will have a profound impact on the long-term viability of many schemes, where funding is underpinned by 30 year commercial borrowing.
Moreover there is a huge regional inequality in the impact of the proposals, with the effect of LHA caps in lower value areas being far more severe. In London just 3% of Riverside tenants will be affected, compared to the East Midlands and North East where practically all tenants will be affected.
Riverside has already stopped work on two new developments and not pursued many other opportunities because of funding uncertainty, and we are not alone. Only last week an NHF survey of some 69 supported housing providers found that concerns over the future financial viability of supported housing had led to 85% of new developments being either mothballed or abandoned altogether.
I was able to provide substantial evidence from Riverside on this issue to the joint parliamentary select committee, which also called on the government to re-think these wholly unsuitable proposals.
The government’s response will form part of a delayed White Paper in the Autumn. It must deliver a sustainable funding framework reflecting the real costs of supporting society’s most vulnerable – not a postcode lottery where already overstretched funding pots are artificially skewed by local housing markets.
This article was first published by Inside Housing on 1 September 2017.