Memorandum by Hanover Housing Association
(SVP 03)
The following summarises key comments and concerns
that Hanover has about the Supporting People programme. We would
be pleased to elaborate in oral evidence to the Committee.
1. OVERALL COMMENTS
1.1. Hanover has been providing sheltered
housing and associated services for older people for 40 years.
The Group manages some 17,000 sheltered properties across England.
1.2. Some parts of the new regime are providing
positive: we welcome, for example, the more formalised support
planning process, which we believe will have benefits for older
people and providers alike; and we are pleased that it will result
in local authorities having to develop a strategic view of housing
and support services, which few have done to date. However, we
believe that these advances could have been achieved in a simpler
and far cheaper administrative and financial framework. Throughout
the consultation period prior to the new Supporting People programme,
Hanover expressed the view that the arrangements would prove unnecessarily
complicated for sheltered housing, which provides low-cost, low-level,
preventative support to older people to promote their continuing
independence and well being. We remain of that view. We welcome
constructive change, but not at any price.
2. KEY AREAS
OF CONCERN
Excessive administration complexity
2.1. Providers are now required to provide
complex Key Performance Indicator data for each sheltered housing
scheme (or sometimes small clusters of schemes) on a quarterly
or monthly basis. The data required is very detailed, to the extent
that we question whether Supporting People teams could ever analyse
it in a meaningful way or cope with the volume. The system could
be much simplified. For example, we are currently required to
supply monthly or quarterly void rates for every scheme. A yearly
figure would provide the Supporting People team with the necessary
"can-opener" indicator to identify schemes with low
demand. Monthly figures will generally be of very little value.
2.2. Providers are now paid a Supporting
People grant for most older people in sheltered housing in place
of the Housing Benefit for this sum that used to be paid, normally
to the tenant. The new financial arrangements are proving costly
to administer. Grant payment schedules are sent to us monthly.
They all need to be checked and Supporting People teams notified
of errors, which remain frequent. Only then can payments be posted
to the tenant's individual account, which meanwhile appears to
be in arrears. It is all additional work: the Housing Benefit
system remains in place for the rest of the tenant's charges.
Our revenue-recording staffing costs have approximately doubled
as a result.
2.3. Sheltered housing support charges are
usually very low: Hanover's are about £5 per week, per person.
We question whether such complicated payment arrangements are
cost effective.
IMPACT OF
2.5% "EFFICIENCY SAVINGS"
IN SUPPORTING
PEOPLE GRANTS
2.4. The Robson Rhodes review has highlighted
the explosion in the costs to be borne by the Supporting People
regime, during the build-up to the regime's introduction. The
transfer of "the pot" from Housing Benefit to Supporting
People was not well controlled and the massive increase in annual
cost was widely predicted.
2.5. In the aftermath of the resultant 2.5%
reduction in the ODPM grant to Supporting People Administering
Authorities from April 2004, the majority of Authorities are proposing
to freeze grants to providers; some are passing on the 2.5% reduction;
some are paying a small increase. The settlement bears little
relation to the relative costs of particular services. A fairer
system, which a small number of Administering Authorities are
proposing, would be to concentrate reductions on those providers
with costs in the upper quartile.
2.6. Prior to April 2003 the ODPM published
a leaflet for sheltered tenants that said support costs should
not increase as a result of the introduction of the new regime.
We agreed with this approach as a third of our tenants pay most
of or all their own costs. Therefore we did not impose an additional
"Supporting People levy" on tenants, though many in
the sector did. The loss on Hanover's support services for 2004-05
if grant on average is frozen will be £200,000; we are paying
for our principles.
SERVICE CHARGES
2004-05
2.7. Supporting People Commissioning Bodies
are only now determining what each provider's grant settlement
will be from 1 April. At the time of writing, only around 50%
of authorities had notified us of a final decision, with only
days to go to the implementation date.
PERVERSE OUTCOMES
2.8. Supporting People teams are suggesting
that providers make efficiency savings to compensate for reduced
grant. Some are suggesting that services be withdrawn from sheltered
tenants with very low support needs. But one of the main advantages
of sheltered housing is that it offers older people an "insurance
option" where they can pay a flat-rate low support charge
but dip in and out of any additional support they might require
throughout their tenancy. Changing this arrangement for sheltered
housing will only result in higher charges for a smaller number
of people, with no overall saving, because the costs per estate
are inelastic—one estate manager and the alarm service.
The ODPM Grant Conditions specifically require authorities to
recognise that many tenants enter the sector at a time when they
do not yet need support, but wish support to be available if and
when they require it. We welcome this policy steer from ODPM but
are very concerned that financial stringency may cause Administering
Authorities to ignore it and impose fundamental change on the
sector, to the detriment of older people.
CONFUSION FOR
TENANTS
2.9. The new regime is causing considerable
confusion for tenants. Tenants' rent accounts now show grant payments
from Supporting People as well as any direct Housing Benefit payments
we might be receiving (the two are paid on different dates and
for different periods). There are sometimes delays in obtaining
Supporting People grant for tenants, or in identifying its destination
(see above), causing worry when rent accounts appear to be in
arrears (our customers take pride in paying their debts). At the
time of writing we have had to notify tenants of provisional support
charges for 2004-05 pending resolution of the grant confusion
described above.
EXTRA CARE
HOUSING
2.10 The Department of Health's welcome
£87 million Extra Care Housing Fund (2004-06), together with
existing Housing Corporation funding, will deliver a much needed
increase in extra care sheltered housing for frailer adults. However,
new extra care housing requires new Supporting People funding,
which Supporting People Administering Authorities do not always
want to prioritise or which they may not have the funds to support.
There needs to be better linkage between capital and revenue funding
systems.
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