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Social Housing Speed Read – supported housing in further crisis

The number of supported housing homes provided by housing associations looks set to decrease as a consequence of the anticipated introduction of the Local Housing Allowance (LHA) cap.

An 85% cut

The National Housing Federation (NHF) has surveyed 69 housing associations. These housing associations, when combined, deliver a third of supported housing. The NHF results reveal that the associations have plans to build 1,350 units of supported housing in contrast to the 8,800 units previously pipelined.

Some associations provided further details saying 71 schemes have been postponed (totalling 2,185 homes), 19 have been cancelled and 25 current existing schemes are at risk of being closed.


The NHF cites the reason for the drop as being the introduction of the LHA cap as this has provided uncertainty.

The awaited introduction of the LHA cap is a huge cause for concern in the sector and since the announcements many registered providers have serious reservations about their viability going forward.

The new system for housing associations is currently planned to come into force in 2019. Under the current proposals, the LHA cap will be applied to all claims, including supported and sheltered housing, with a top up paid by the local authority.

We are still waiting for the Government’s Green Paper on supported living which may provide certainty: this was expected in spring and is yet to surface.

Housing Associations have previously called for a separate supported housing fund to be set up by the Government, however, this has also not come to light yet despite being backed by the Communities and Local Government Committee and the Work and Pensions Committee.

Chief executive of the NHF, David Orr, highlights how these findings show that “housing associations know first-hand that the proposed funding model will not work – a view backed by a joint select committee – and yet government has failed to heed warnings”. As a consequence building is being stopped “for the most vulnerable.”

Mr Orr continues to state that “the role supported housing plays in alleviating pressures on the NHS is ever more important” given the current social care crisis.

Recent research by Demos (commissioned by Anchor, Hanover and Housing & Care 21) reports savings of £300 million in reduced hospital stays. Mr Orr states that even though the changes brought by the LHA cap haven’t come into force yet, “they have taken 7,000 homes for vulnerable people out of the pipeline.”

Government pressure

It appears we are starting to see the impact of the LHA cap and the current uncertainty surrounding this change with this 85% cut in the delivery of social housing.

Pressure has been mounting on the Government since the introduction of the cap was announced and this will no doubt intensify following the results of this survey.

David Orr has called on the Government to “put supported housing on a secure and sustainable footing” which is no doubt necessary although only adds to the ever increasing list of calls for change within the sector.

If you have any questions on the above and how it will affect social housing providers, or any other questions as a social housing provider, please do not hesitate to contact John Murray or a member of our expert Social Housing Team.

Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.

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