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DCN: Rising costs of homelessness must be reflected in future funding formula

Published: 1 November 2018
New homes under construction in district


Rising levels of homelessness need to be reflected in local government funding reforms after more than half of district councils reported an increase in requests for help dealing with the issue in the first six months of new housing legislation.

As the housing and planning authorities, districts are at the forefront of preventing and relieving homelessness. However, only one in five districts say that government funding to support the implementation of new statutory duties under the Homelessness Reduction Act (HRA) is sufficient, while over two-thirds (69 per cent) have seen an increase in the visible signs of homelessness in their areas, according to the survey of DCN members.

The survey has been carried out to find out how district councils have been impacted by the first six months since the implementation of the HRA, which places a duty on councils to assess the housing and support needs of every client who is homeless or threatened with homelessness and to provide them with a Personalised Housing Plan.

Districts can and want to do more to support their most vulnerable residents, so are urging Government to ensure that the rising costs of tackling homelessness are reflected in the fair funding formula which is due to be consulted on shortly through the fair funding review.

DCN is further calling for:

  • Extra funding on top of the initial HRA implementation funding, so that councils can continue to secure accommodation for homeless people
  • The HRA cap to be lifted as soon as possible, together with more infrastructure funding, so councils can build more social housing
  • Greater financial flexibilities for non-stock-holding authorities to borrow to build more homes
  • A review of current housing payment processes within Universal Credit which remove the security of direct rent payments to private landlords who need greater reassurance that the tenancies of benefit claimants or people with previous rent arrears will be successful
  • An early review of the HRA administration process to be streamlined as it is more time-consuming than the previous homelessness duties
  • Urgent action regarding the increasing tenancy fees set by letting agents in order to secure accommodation

DCN Chairman Cllr John Fuller said:

“Everyone deserves a safe and affordable home. We welcome the Homelessness Reduction Act, but since April 2018, over half of district councils have seen an increase in requests for homeless advice and assistance, with an increase of more than 100 per cent in some areas during this six-month period.

“The ongoing costs for new HRA duties far outweigh the initial funding – which isn’t enough on its own to address the lack of housing supply or the affordability issues affecting people in need – and can’t be sustained in the long-term. Providing additional, sustainable funding beyond 2019/20 through the funding formula will allow Districts to continue to support homeless people or those at risk of becoming homeless over a longer time period.

“The thresholds set for various support services are now so high that they are predominantly crisis-focused and are less responsive to addressing the low level issues that lead to homelessness, which coupled with funding cuts to council budgets, impedes the work to prevent it and can lead to people becoming trapped in a cycle of homelessness.

“The announcement on lifting of the HRA cap was well-received by Districts but this needs to be implemented as soon as possible so councils can build more affordable homes which are badly needed to help provide long term solutions to homelessness.

“District councils believe multi-agency work needs to be strengthened to target the various factors that have either caused people to become homeless or is preventing them from being rehoused because unless the Government tackles the root causes of homelessness then there is a risk that initiatives will not remain successful in the long term.”


District Councils’ Network media office, 020 7664 3333

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