Welfare Reform and Work Bill Committee

Written evidence submitted by Framework Housing Association (WRW 77)

Who is this submission from?

This submission to the Public Bill Committee is by Framework Housing Association. Framework is a specialist provider of emergency and specialist housing, support, treatment, training and employment services for homeless, vulnerable and excluded people.

What is it about?

It refers to clauses 19 and 20 of the Welfare Reform and Work Bill. Clause 19 includes a proposal to change the existing formula by which social housing rents are calculated. Clause 20 lists some exceptions to this. At present they do not include supported housing. Framework urges your support for an amendment (No. 109) that will add supported housing to the list of exceptions.

The financial situation and viability of supported housing

The financial position of supported housing is fundamentally different to that of mainstream affordable housing. Its primary cost drivers are size and staffing levels (as opposed to capital cost and grant rates). This makes it a low margin operation – so a relatively small income reduction can throw service into financial difficulty.

In recent years the onward transmission of local authority budget reductions has had a disproportionate impact on supported housing, especially for groups of people to whom LAs consider they have no statutory obligations.

How have Services survived to date?

Some services have already closed as a consequence of the above. Others hang by a thread. Providers have sustained them by repeatedly cutting costs and trying where possible to cushion the impact on service users. Income from rent and service charges (currently rising by CPI + 1% per annum) has become the mainstay of their budgets and forward plans. The balance has become so precarious that these services and their providers are unable to withstand another big hit.

What are Committee Members being asked to do?

Members of the Public Bill Committee are urged to support Amendment 109 to the Welfare Reform and Work Bill. This would exempt ‘specified accommodation’ (as defined in the Housing Benefit and Universal Credit Regulations 2014) from the change in the rent formula. The need for this to happen is hard to overstate – supported housing is a cost-effective alternative to more institutionalised forms of provision for vulnerable people (such as hospitals, care homes and prisons) that are more expensive to the public purse.

There is an alternative proposal to exempt ‘specialised’ supported accommodation (as defined elsewhere) from the changes. We stress to the Committee’s members that this narrower definition is confused, difficult to interpret and inadequate in scope.

Why is ‘Specialised Supported Accommodation’ inadequate to define the exemption?

There is no particular relationship between the small group of supported housing schemes that might be covered by the ‘specialised’ definition and any government policy direction; nor are these schemes more vulnerable than the others. It is most if not all of the sector that is at risk. The exemption of ‘specified’ accommodation is a solution but the use of the ‘specialised’ definition is not.

Long and short-term solutions

What is ultimately needed is a new model for the commissioning and funding of supported housing. This will take time to develop and implement, but we understand that consultants have been engaged by DWP and DCLG to begin scoping the task. In the meantime the services that we and similar specialists deliver across the country are in desperate need of some stability. Amendment 109 will afford this and we ask the members of the Public Bill Committee to support it.

October 2015

Prepared 20th October 2015