The scope of this briefing is to look at the Universal Credit Draft Regulations, progress on the DWP Review of the Future of Housing Benefit for Sheltered & Supported Housing and the Social Security Advisory Committee Consultation on the Universal Credit Regulations. There is a relationship between all 3 of these things and there is a common theme: will “supported housing” be excluded from Universal Credit and will the need to define “vulnerability” also define who lives in supported housing?
Lately we have been very busy with enquiries from clients and others concerning the future of Housing Benefit for supported and sheltered housing. The primary reason for this is the publication in June of the Draft Universal Credit Regulations and on 19th June the publication of a briefing by a sector advisor which said the Draft Regulations for Universal Credit had been published but made no mention of supported housing or Exempt Accommodation. The author assumed that this was because either:
- Supported housing would be subject to the general Universal Credit rules just like any other form of housing, or
- The Government might exclude supported housing from Universal Credit
The briefing in question proceeded on the assumption that 1 above would apply.
This briefing also made no reference to the meeting of 19th March between Lord Freud (Minister for Welfare Reform), DWP officials and sector representatives, which relates very strongly to 2 (above). In addition, the DWP consultation proposals on the future of Housing Benefit for supported and sheltered housing are still to finally report. We are aware of a number of organisations that were notified that the briefing had been revised and we are aware of rather more who were not; a consequence probably of the unrestricted circulation policy for the briefing in question.
It is important for Support Solutions to set out our understanding of the situation so that providers of supported housing are fully informed as to the possibilities. There are 3 broad areas of concern:
- Supported housing and Universal Credit
- Service charges for supported housing
- The SSAC Consultation on Universal Credit
Supported Housing & Universal Credit
The Draft Regulations on Universal Credit don’t mention supported housing or Exempt Accommodation. We believe there is increasing evidence to suggest that the Government is intending to exclude “supported housing” from Universal Credit for the time being at least. We put “supported housing” in inverted commas because we don’t know whether this definition includes, for example, sheltered housing. It would be consistent if it does include sheltered housing given that this type of accommodation was included in the original Supporting People contract arrangements and is almost exclusively provided by Registered Providers of social housing. However, if “supported housing” is excluded from Universal Credit, it remains to be seen how it will be defined. This question may be resolved as a consequence of a definition of “vulnerability”, which the DWP has said may happen and which Support Solutions has said is necessary.
We published a briefing on 7th May which deals in more detail with the notion of excluding supported housing from Universal Credit. You can read that briefing here, but to summarise Lord Freud suggested at the 19th March meeting:
- Devolved arrangements for administering Housing Benefit for Exempt Accommodation
- The possible exclusion of supported housing from Universal Credit
- A definition of “vulnerability”
He mentioned other things such as the fact that, in supported housing, the rent will be paid direct to the landlord as default position; that should supported housing be included in Universal Credit (which is by no means certain) it will be on the basis of “robust risk assessments and piloting”; that there will be transitional arrangements should this occur and that there will be a review of service charges in general.
All of these points are covered in our 7th May briefing. Their significance, in summary, is that we now see the possibility of the retention of some local infrastructure to administer benefits to people in “supported housing”. It is important to be aware; however, that “supported housing” may be redefined, possibly because of the need for a definition of “vulnerable”, which will doubtless influence any definition of “supported housing”. It is also important that we await, and influence, developments. The Draft Universal Credit Regulations are as they are described: draft. Lord Freud’s thinking on supported housing is just thinking at the moment but it is interesting thinking.
We will also need to think about the definition of “vulnerable”. We assume that there will be a relationship between what “vulnerable means and what “supported housing” means. For example, there are many people on JSA and not deemed “vulnerable” who are not only unable to hold down a job, they may also be in no position to look for one. They may have substance misuse or other issues which, given some time and structured input from a housing support & social care provider, can be overcome. Such people should fall into the “vulnerable” definition until such time as they have obtained or regained the independence they need to study, train or work.
The issue of service charges has thus far not really been discussed – until now. Please read on.
Service Charges for Supported Housing
The Draft Universal Credit Regulations devise a new approach to service charges for social housing; they say nothing about supported housing. They categorise eligible service charges for social housing as follows:
- Services necessary to maintain the fabric of the accommodation
- Cleaning of communal areas
- Cleaning the exterior of windows where the tenant or someone on their behalf cannot do so
They state that anything relating to the supply of a commodity (e.g. water or fuel) would be deemed ineligible.
None of the eligible or ineligible charges identified above have been properly defined; however, over and above that there still remains the issue of whether supported housing is actually included within the Draft Regulations for Universal Credit, within which the approach to service charges for social housing is set out.
If Lord Freud’s suggestions made at the 19th March meeting do bear fruit and supported housing is excluded from Universal Credit then it might be sensible to continue to administer benefits for vulnerable people through existing regulatory arrangements. This would mean that the proposed service charge policy in the Draft Regulations for Universal Credit would not apply to supported housing. Of course, the Government could still amend the existing Housing Benefit regulations that govern supported housing such that, even though it might be excluded from Universal Credit, the service charge regulations applicable to social housing within Universal Credit should also apply to supported housing.
To do so would be to miss a fundamental point in the funding of preventative enabling services in supported housing. Whether funding for such services is routed through Supporting People or the Housing Benefit funded service charge or any other route, it saves an awful lot of money to the statutory sector. This saving is in the form of reduced numbers of expensive emergency statutory interventions by the NHS, Social Services, the criminal justice system and the Homelessness department. These reduced interventions are as a consequence of much cheaper preventative services, which have better outcomes for vulnerable people, often funded in part at least through the Housing Benefit service charge. Only about 5% of the total Housing Benefit budget is spent on sheltered and supported housing and it’s the only part of the Housing Benefit budget that provides a significant social return on investment.
Preventative intervention is low cost, effective and good for people and communities. Emergency intervention is high cost, reactive and often an unintended consequence of a failure to fund less expensive preventative interventions.
The SSAC Consultation on Universal Credit
The SSAC (Social Security Advisory Comittee) is consulting on the Universal Credit Draft Regulations. SSAC is an independent advisory body of the Department for Work and Pensions and it is seeking your views on these regulations. Responses must be submitted by 27th July. You can view and respond to the Consultation here.
Again, the critical issue here is whether or not supported housing will be excluded from Universal Credit. If it is, then the question is: how will welfare entitlements for supported housing and vulnerable people be administered?
We think it is important for people to respond to the SSAC Consultation and make the following points, which are not exhaustive:
- “Vulnerability” needs defining: it should include those people who may be currently on JSA but have issues, perhaps hidden, that prevent them from seeking or maintaining employment or training.
- Targeted short-term interventions funded, at least in part, through the Housing Benefit service charge are a very cost-effective means of funding prevention and enablement.
- Subject to a sensible definition of “vulnerability” vulnerable people, including those in supported housing should be excluded from Universal Credit and have welfare entitlements administered locally.
- Direct payment of welfare entitlements to vulnerable people should not be the default position. It should be an outcome of preventative intervention where appropriate.
- Approximately 5% of the total annual Housing Benefit budget is payable to supported and sheltered housing. That 5% delivers a huge return socially and financially: it saves the statutory sector a fortune and impacts positively on the lives of vulnerable people and communities. It is a social investment which should be properly targeted to vulnerable people.
We hope that the Government, and the DWP as part of it, understands the argument and we think that the sector has a breathing space in which to make the case for the funding of prevention as we at Support Solutions continue to do. The possibility of excluding supported housing from Universal Credit buys us more time whilst the Government grapples with the complexity of revenue for supported housing. If the Government decides to restrict service charges to supported housing in the way described in the Draft Regulations for Universal Credit, even though supported housing may be excluded from Universal Credit, then we still have a good idea about how the costs of intensive housing management and other essential housing services can be funded justifiably and legitimately.
It remains really important for accommodation-based service providers to think about allocating intensive housing management costs into the Housing Benefit service charge or rent. In fact it’s probably never been more important as a means of sustaining and securing revenue and services in a time of change. You can find out more about this here.