Annex A
SUPPORTING PEOPLE DISTRIBUTION FORMULA
GRANT DISTRIBUTION
AND ALLOCATIONS
RATIONALE FOR
THE SUPPORTING
PEOPLE DISTRIBUTION
FORMULA (SPDF)
1. In the run up to the launch of the Supporting
People Programme, intensive detailed work was done to calculate
the amount of grant supporting each SP scheme, supported by bespoke
IT provided to each Authority. This took account of several grant
streams (including from Housing Corporation and Probation services)
which were paid to the organisations providing the support services,
as well as the amount paid by individuals for the support through
the rent (and in most cases funded through Transitional Housing
Benefit (THB), though in certain "long term" schemes
individual contributions from people able to afford these charges
were also taken into account). The amount of THB paid to individuals
was a matter for local Housing Benefit Officers acting in the
context of the THB regulations which were in force at the time.
The funding in each authority was then calculated on an annualised
basis as a total of to each and every individual scheme which
was in place on 7 April 2003, net of income from charges.
2. In 2004 CLG commissioned an independent
review into whether the Supporting People programme was providing
value for money. The review concluded that £1.8 billion
was too much to spend on the services then being provided. As
recommended by this report we worked towards a reform of the Supporting
People funding so that allocations are based on need rather than
the legacy of services in place at the start of the programme.
This resulted in the creation of, and consultation on, the SPDF.
3. In addition, under the terms of the SR2004 settlement,
ODPM was required to move to a more equitable basis for the distribution
of the SP grant between authorities. A needs-based distribution
formula has been developed as a tool for future distribution.
4. Following the CSR2007 process and
as part of the settlement it was acknowledged that whilst work
had been carried out during the SR2004 spending review period
to redress the imbalance, further work was needed. The allocation
of SP programme grant for the next three years 2008/09—2010/11,
based on limited implementation of the distribution formula was
conditional on steps being taken to fill the gaps on incomplete
and/or missing data sources. This needed to be completed by the
end of the CSR period so that there is a better understanding
of where resources are most needed.
Consultation process
5. Communities and Local Government published
Supporting People Distribution Formula—Technical Consultation
Paper:[58]
on 6 December 2007 alongside the indicative grant allocations
for the Supporting People programme for 2008-09, 2009-10 and
2010-11. The model used to calculate these allocations was published
on 14 December 2007.
6. The Department committed to publishing
a summary of refreshed responses alongside a Written Ministerial
Statement in February. This was published in February 2008 as
"Supporting People Distribution Formula—Technical Consultation
Refresh":[59]
The consultation refresh document explained that the Department
had considered responses and concluded that the Supporting People
Distribution Formula is fit for purpose within certain parameters,
and represents the most effective option for better targeting
Supporting People funds to meet need.
7. This decision was also based on consideration
of the responses to the Supporting People Distribution Formula—Technical
Consultation, published in November 2005, policy developments
and an exploration of alternative approaches to determining allocations.
The 2007 document summarised responses to the November 2005 consultation
and invited Administering Authorities and others to refresh their
responses, if they believed matters had changed locally in such
a way that they would have answered the consultation in a materially
different way now. Responses to the 2007 Technical Consultation
Paper were considered under these terms and the 2008 document
was limited to these points.
The formula
8. The SPDF takes the total Supporting People
funding "pot" for England as a given. It assesses relative
need between authorities, mainly on the basis of numbers of vulnerable
people at risk, with allowances for levels of deprivation and
cost differences, and calculates target allocations for each authority
based on the level of need for housing related support, by using
various needs data. How quickly the SPDF is used to distribute
funding so authorities reach their target allocations is based
on two principles:
— authorities furthest away from their
target allocations should receive the largest annual increases
and face the largest annual reductions respectively.
— there should be "no cliff edges".
That is, the pace of change must not be too fast, particularly
for those facing large reductions in allocation. Increases and
reductions of significant size cannot be implemented rapidly—there
are pragmatic limits to how quickly change can be delivered on
the ground.
9. In deciding how to achieve this, the
task was to strike a reasonable balance between ensuring funding
is allocated according to need, and ensuring that the pace of
change in doing so secures the best provision of housing support
services to vulnerable people. As such, by the end of this spending
review period, a small number of authorities will remain outside
of the parameters set in the SPDF. However, we have committed
to the redistribution of SP funding as part of the next spending
review (subject to resources) which provides a further opportunity
to ensure the outlying authorities are brought closer to their
target allocations.
Future developments
10. CLG commissioned its Housing Analysis
and Surveys Expert Panel in September 2008 to carry out a
technical desk study on the formula. The objectives are to review
the existing data sources and levels of deprivation applied in
the formula, summarise any issues with these and make recommendations
for addressing these issues, to inform any future work to develop
the formula. A draft final report has been received and is being
considered currently. This will be published on the Expert Panel
website later in the year.
58 Supporting People Distribution Formula-Technical
Consultation Paper: Summary of responses and invitation to refresh
responses-December 2007 Back
59
"Supporting People Distribution Formula-Technical Consultation
Refresh: December 2007-Summary of Responses". Back
| 
