Housing Crisis - spending on B&Bs for homeless rockets since 2010

Councils in England directly built 2,550 homes in 2018/19 - the highest since 1992/93 – but the LGA warns this risks being undermined by councils only being able to replace a quarter of homes sold under Right to Buy.


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New analysis by the Local Government Association shows that councils are having to spend nearly 10 times as much money on placing homeless households in bed and breakfasts due to rising demand for support and a shortage of homes, as they were a decade ago.

Councils only use bed and breakfasts as a last resort but the continued loss of social housing is leaving many with no alternative in which to house homeless families.

Latest figures show that councils in England were forced to spend £93.3 million on bed and breakfast accommodation in 2017/18 – a huge increase on the £10.6 million spent in 2009/10.

There are currently 7,040 households in bed and breakfast accommodation – up from 2,450 a decade ago.

The LGA says it is critical the Government uses the Queen’s Speech on Monday to give councils the powers to get building more affordable housing, replace homes being sold under Right to Buy and long-term funding to reduce homelessness and prevent it happening in the first place.

It is also calling on government to adapt welfare reforms to protect families at risk of becoming homeless, by restoring Local Housing Allowance rates to at least the 30th percentile of rents when the current freeze ends in 2020.

The LHA determines the maximum level of support with housing costs that is provided to households renting in the private sector. The Government’s decision to freeze the rates in 2016, combined with the affordability crisis means that this is often not sufficient. 97 per cent of areas in England are now unaffordable for renters who are entitled to housing support. Termination of a private rented sector tenancy is now one of the biggest causes of homelessness.

Councils in England directly built 2,550 homes in 2018/19 - the highest since 1992/93 – but the LGA warns this risks being undermined by councils only being able to replace a quarter of homes sold under Right to Buy. 

Reform of the RTB is needed so that councils retain 100 per cent of their receipts to reinvest in replacing homes accompanied with the right infrastructure, and can set discounts locally. This is the only way to ensure it works for future generations. 

The LGA’s housing spokesman, Cllr David Renard, said:

“It is a tragedy when anyone becomes homeless and the last thing councils want to be doing is placing people in bed and breakfast accommodation.

“This analysis shows that sadly many councils are exhausting all their options and are having little choice but to use B&Bs more and more.

“Not only is this far from ideal for families, it is very expensive for councils, who are already under significant financial pressures. Councils would much rather use these scarce resources to build more affordable homes and prevent people from becoming homeless in the first place. 

“We now need government to act and use the Queen’s Speech to kick-start the genuine renaissance in council house building needed to reduce homelessness and solve our national housing crisis.”

 

Notes

As part of its #CouncilsCan campaign, the LGA has set out radical plans for how the Queen’s Speech on October 14 can be used by the Prime Minister to reignite the devolution process to ensure all parts of England reap the benefits of having greater powers and funding to improve services such as housing, transport, and health and social care. 

Statutory Homelessness, January to March (Q1) 2019: England

Number of households in temporary accommodation and bed and breakfasts

Council expenditure on bed and breakfasts:

LGA LHA briefing

Crisis and Chartered Institute of Housing research on Local Housing Allowance, which shows that 97 per cent of areas in England are now unaffordable for single people, couples and small families reliant on LHA

Latest house-building stats