Homelessness / poverty

Housing Benefit changes could result in more street homelessness in Derby.

All Homeless people need help; the most vulnerable need active, long-term support, to keep them safe, and off the streets.

In a previous article, “The Homelessness Paradox; It’s not just a housing shortage” I discussed the notion that being homeless wasn’t necessarily about someone simply not having a house. And that there is a wide spectrum of possibilities as to why people find themselves in that situation and that organisations exist who help them to recover and , ultimately, get them back into the “system”.

Supported Housing

There are a number of charities in Derby that offer supported housing – e.g. Derventio, Faith Hope Enterprise, and PACE who have been established to help those with the most complex needs

  • drug addiction,
  • alcoholism,
  • learning disability,
  • mental health problems,
  • offending records,
  • behavioural issues, as primary examples, or
  • women fleeing domestic violence.

The properties that they manage are predominantly shared houses with some separate units, but the most important factor is the dedicated regular support that they provide. Each tenant will have their own individual needs,  and their support worker will help them to develop a programme which will allow them to progress, and improve, to achieve their personal goals. There will be a range of outcomes and timescales – some may succeed in 6 months, for others it may take years, or possibly a life time. These are some of the most vulnerable of people who are struggling to cope with life.

Why there are so many people in this situation is a much bigger question about society as a whole, and the wisdom of past decisions taken to withdraw funding from early intervention support. The fact is, that there are many hundreds of people in Derby who need this type of accommodation,  who are being cared for, and protected  from the real risk of being lost to street homelessness.

How does supported housing work?

Supported housing is not a state provision. The organisations I have cited, above are charitable, and they all operate to a similar business model for securing the housing and financing the support. This is a not-for-profit exercise. The basic model is:

  • Properties are owned by a private landlord and are made available, unfurnished.
  • Charity contracts a long-term tenancy with the landlord at competitive rent – the landlord has secure long term income so they can offer a lower rent.
  • Charity furnishes property and maintains it
  • Charity receives enhanced Housing Benefits to cover cost of furniture and furnishings, managing the property and providing workers to support residents.

There are permutations around this when the Charity actually owns the property, but the income from Housing Benefit is the same.

Changes to Housing Benefits

In the November 2015 Spending Review, the Government announced:

‘ The government will cap the amount of rent that Housing Benefit will cover in the social sector to the relevant Local Housing Allowance, which is the rate paid to private renters on Housing Benefit. This will include the Shared Accommodation Rate forsingle claimants under 35 who do not have dependent children. This reform will mean that Housing Benefit will no longer fully subsidise families to live in social houses that manyworking families cannot afford, and will better align the rules in the private and social rented sectors. It will also ensure that Housing Benefit costs are better controlled and will help prevent social landlords from charging inflated rent for their properties. This will apply to tenancies signed after 1 April 2016, with Housing Benefit entitlement changing from 1 April 2018 onwards’

The Local Housing Allowance (LHA) depends on where you live.  The LHA rate is based on the cheapest 30% of private rents in the local authority area. [ LHA is effectively the name for Housing Benefits when the property is owned by a private landlord rather than the Council]

In a nutshell, people who are in receipt of Housing Benefits will see a reduction; by how much will depend on personal circumstances. Charities who offer supported housing, will be subject to massive reductions in income, of the order of 70%, unless the proposals are changed to exempt these types of cases.

This destroys their business model – it becomes totally unworkable!

The Government has stated that it will protect those in supported Housing by increasing the funding of Discretionary Housing Payments (DHP). As the Government does not know how much HB is paid, for supported housing, in each area, the allocations of DHP could be hit and miss.  The Council has many demands on DHP monies, and will be more inclined to support people who are affected by the Benefits Cap, or Bedroom tax, if they would otherwise have a statutory obligation. This is not a reliable alternative for the housing charity sector.


This may be an unintended consequence of the Government’s desire to be prudent with public money, in the same way that the Bedroom Tax seemed like a good idea in the corridors of Whitehall but which drove people into poverty and homelessness. If it proceeds unabated then those who have no options for routine funding will have to cease supporting these vulnerable people. Whilst the consequences may be unintended, they are entirely predictable – many people will lose the care, security and certainty of this provision, hundreds more people will be rendered homeless, and too many consigned to the nightmare of rough sleeping.


Nationally there about 36,000 bed spaces at risk because of this proposal. In Derby,  there is of the order of 2-300.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s