Consultation on future changes to funding of supported housing

Theresa May recently announced that the UK Government no longer intends to extend LHA restrictions to the social housing sector. This announcement is further expanded on in a policy statement and consultation on Funding Supported Housing. The proposals contained in this document apply to Great Britain, although the decision not to apply LHA rates to social housing will apply equally in Northern Ireland.

Government proposals

The Government proposes tailoring the way in which supported housing will be funded or paid for and suggests different models for the three main types of supported housing. The paper suggests that the new funding model could take effect from April 2020.

Sheltered or “extra care” housing.

This is housing usually designated for older people with support needs, though also open to working-age tenants where appropriate. The Government proposes to introduce a “Sheltered Rent” from April 2020, which will be set by the social housing regulator, include rent and eligible service charges, and remain within the Social Security system. The current social housing regulator in England is the Homes and Communities Agency.

Short term and transitional supported housing.

 The Government defines this as “[a]ccommodation with support, accessed following a point of crisis or as part of a transition to living independently, and provided for a period of up to two years or until transition to suitable long-term stable accommodation is found, whichever occurs first.” Examples of this include housing for people fleeing domestic abuse, offenders, and people receiving support for drug and alcohol misuse. Currently stays in such accommodation is largely funded by Housing Benefit. Under these proposals, the Government will provide English local authorities with a ring-fenced local grant fund to fund the cost of providing such accommodation, removing the cost of such short-term accommodation from the welfare budget. Local authorities will then be responsible for planning, commissioning and oversight of this accommodation. The Scottish and Welsh devolved governments will have responsibility for the distribution of their shares of this funding.

Long-term supported housing.

The Government defines this an extremely diverse part of the supported housing sector, which typically caters for working-age tenants with additional mental or physical needs, and also includes extremely specialised housing, where costs are much higher than elsewhere in the sector. The Government will continue to fund 100% of rent and eligible service charges for this housing through the Social Security system, subject to existing benefit rules.

Relevance to Northern Ireland

This consultation is on proposals which initially apply to Great Britain, and within this, the Scottish and Welsh devolved governments retain some responsibility. However, Section 87 of the Northern Ireland Act 1998 – commonly known as the “parity principle” – aims to ensure a single system of Social Security for the United Kingdom, insofar as possible. Therefore, whilst housing and Social Security are devolved issues in Northern Ireland, any changes to the way in which the housing and support costs of supported accommodation are paid for in Great Britain are likely to have implications for the funding available in Northern Ireland.

The consultation is open until 23rd January 2018.