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Supported housing funding changes shelved

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The government has decided against making changes to how housing benefit for vulnerable people living in supported housing is provided.

Following a three month consultation last year, the government has today announced it will continue to pay rent directly to landlords through housing benefit and not pursue a number of alternative models it had previously proposed.

One suggested model would have apportioned grant funding to top-tier councils to administer. The initial proposal said this would provide “local areas with more oversight and control over the provision in their areas” and “remove short-term accommodation costs from the welfare system”.

However, there were concerns about the size of the grant and whether it would grow in line with demand, while there were also worries about administrative costs. 

Under the second proposed model, titled ‘sheltered rent’, the government would have introduced a cap on service charges in sheltered housing.

David Orr, chief executive of the National Housing Federation, said: “We were concerned that a cap of this nature would disincentivise development of sheltered and extra care housing, meaning the gap between need and provision would continue to grow, so this announcement is very welcome.”

Chartered Institute of Housing head of policy Melanie Rees also welcomed the government’s decision. She said: “This type of housing provides vital support for some of the most vulnerable people in our society – people who have been victims of homelessness or domestic abuse for example – and it is absolutely right that it will continue to be funded by the welfare system.

“Without that certainty there was a real risk that refuges and other supported housing schemes would have been forced to close.”

Housing secretary Kit Malthouse said: “Protection of the most vulnerable has always been our primary concern, and following our consultation, the case for keeping supported housing in the welfare system became clear.

“The sector also recognised that our aim of improving the quality of homes must be addressed, and we look forward to now working with partners to make sure we have strong measures in place.”

Chair of the Local Government Association’s community wellbeing board Izzi Seccombe (Con) said: “A sustainable funding model for supported housing is critical to ensuring councils can reduce homelessness and help older and other vulnerable people.

“It is, however, crucial that councils have the leading role in overseeing and ensuring the provision of housing for vulnerable groups is good quality, value for money, and fits in with the wider local services offered in places.

“We look forward to working with the government and our housing and care partners to ensure that the future of supported housing best achieves our ambitions for communities.

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