Oxford City Council has called for urgent government action to support councils over the spiralling costs of temporary accommodation for homeless households.
Oxford is one of 119 English councils to sign a letter to chancellor Jeremy Hunt from the cross-party District Councils’ Network (DCN) after an emergency summit last week.
The cost of living, record private rents and government inaction on a ‘no fault’ eviction ban first promised in 2019 are fuelling a sharp rise in homelessness.
Councils spent £1.7 billion on temporary accommodation in 2022/23 - a 9% annual increase – and the DCN says the situation is “becoming untenable” and poses a “critical risk” to council budgets.
Asking for a meeting with the chancellor ahead of the autumn statement, the letter calls for six key actions:
- raise local housing allowance (LHA) rates to cover at least 30% of local market rent and commit to annual uprating
- provide £100m more funding for discretionary housing payments (DHPs) in 2023-24 and a further £200m in 2024-25
- provide a £150m top-up to the homelessness prevention grant (HPG) for 2024-25
- review the housing benefit subsidy rate cap for council homelessness placements
- develop policy to stimulate retention and supply in the private rented sector
- give councils the long-term funding, flexibility and certainty needed to increase the supply of social housing
The impact in Oxford
LHA rates have been frozen since 2020 and now fall well short of the cost of renting privately in Oxford.
ONS private rental market statistics suggest raising LHA to cover 30% of rents would need increases of nearly £300 a month for a two-bed home and over £250 a month for a three-bed home.
DHPs are part-funded by the Department for Work and Pensions (DWP) and the council uses these to mitigate LHA and other housing benefit shortfalls.
However, the DWP grant has been frozen at £253,638 and the council currently expects to spend around £435,000 in 2023/24 – a 33% increase on last year, when it spent £328,339.
The council has legal duties to prevent and relieve homelessness. The impact of increasingly unaffordable housing means increased pressure on council services and a rapid rise in the number of households in temporary accommodation.
In the six months between May and October, the council:
- accepted a duty to prevent homelessness for 201 households, compared to 79 households in 2022/23 - a 154% increase
- saw a 107% increase in ‘no fault’ eviction notices resulting in homelessness, from 27 to 56
- accepted a duty to relieve homelessness by providing accommodation for 223 households, compared to 105 households last year – a 112% increase
- made 234 placements in temporary accommodation, compared to 99 in 2022/23 - a 136% increase
The council is looking at a range of options to meet the increased need for temporary accommodation while holding down cost pressures on its finances.
Oxford is better placed than many similar councils to weather this storm.
It has already reorganised its Housing Needs service to put preventing homelessness at the heart of all its work. As a housing authority with around 7,900 homes, it has been able to use its own stock more flexibly to provide temporary accommodation and move people on into a settled home more quickly.
Providing more affordable homes is also a key strategic priority for the council. Its affordable housing supply programme is on track to deliver a target of 1,600 new affordable homes in the four years to 2025/26 - with at least 850 of these at genuinely affordable social rent.
This will be achieved through the council’s housing company OX Place, partnership work with housing associations and open market acquisitions.
The government has moved to drive up standards for social housing in the wake of the Grenfell Tower disaster and the more recent death of two-year-old Awaab Ishak from prolonged exposure to mould.
A new regulatory framework is now in place, with stronger powers for the Regulator of Social Housing in the recently passed Social Housing (Regulation) Act 2023.
While the council welcomes higher standards, the cost of meeting them will mean more government support is needed to build the new generation of council homes Oxford so badly needs.
Comment
“The cost of living and government inaction on the promised ban of ‘no fault’ evictions are fuelling a national homelessness crisis. In the last two years, the number of placements we’ve made into temporary accommodation has more than doubled.
“These are difficult times and we’ve been working hard to rise to the challenge. Prevention is always better and more cost-effective than cure, so we’ve reorganised our Housing Needs service to put homelessness prevention at the heart of our work.
“We’ve increased the amount of temporary accommodation people can access and we’re moving more people on into more settled housing.
“We’re also providing more affordable homes through our housing company OX Place, partnership work with housing associations and by buying good value properties on the open market to relet as council homes.
“A new raft of regulations for social housing means we’ll need to make substantial investment in our existing council homes. This is welcome, but it cannot come at the expense of building new council homes as well.
“We’re managing better than many similar councils, but we need more help from central government. The DCN has clearly set out the scale of the issue and we hope the chancellor will show he’s listening in his autumn statement.”
Councillor Linda Smith, Cabinet Member for Housing
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