Levelling Up, Housing and Communities Committee
Oral evidence: Exempt Accommodation, HC 21
Monday 4 July 2022
Ordered by the House of Commons to be published on 4 July 2022.
Members present: Mr Clive Betts (Chair); Bob Blackman; Sara Britcliffe; Ian Byrne; Florence Eshalomi; Ben Everitt; Darren Henry; Kate Hollern; Andrew Lewer; Mary Robinson.
Questions 142 to 223
Witnesses
I: Eddie Hughes MP, Minister for Rough Sleeping and Housing, Department for Levelling Up, Housing and Communities; Cathy Page, Deputy Director for Supported Housing, Domestic Abuse and Home Adaptations (Disabled Facilities Grant), Department for Levelling Up, Housing and Communities; David Rutley MP, Minister for Welfare Delivery, Department for Work and Pensions; and James Wolfe, Director, Disability and Housing Support, Department for Work and Pensions.
Witnesses: Eddie Hughes MP, Cathy Page, David Rutley MP and James Wolfe.
Chair: Welcome to the panel. Before we start, I ask members of the Committee to put on the record any particular interest they may have that may be directly relevant to this inquiry. I am the vice chair of the Local Government Association.
Ian Byrne: I employ a councillor in my office.
Kate Hollern: I also employ a councillor in my office.
Ben Everitt: Likewise, I employ a councillor.
Mary Robinson: I employ a councillor in my office.
Darren Henry: I employ a councillor in my office.
Eddie Hughes: I employ a councillor too, Chairman.
David Rutley: So do I.
Eddie Hughes: We don’t want to feel left out.
Q142 Chair: It is nice to hear Ministers joining in before they are even asked a question. Thank you very much for coming with your officials this afternoon. Please introduce yourselves and your officials.
Eddie Hughes: Eddie Hughes, Minister for Rough Sleeping and Housing and Cathy Page is my expert assistant for the afternoon.
David Rutley: David Rutley. I am the Minister for Welfare Delivery and James Wolfe is the expert on the subject from DWP.
Q143 Chair: It is always good to have experts with you, Ministers, I am sure, on an issue that is extremely complicated in parts. As well as being complicated, in some ways it is also pretty shocking. I have been a Member of Parliament for 30 years now. Some people might question whether that is an appropriate length of time but I have to say that I have been absolutely appalled by what I have seen in this inquiry so far and the conditions that people are living under. I thought that I had seen everything and would not be shocked by anything anymore, but this was pretty awful.
We went to Birmingham the other week and talked to some people at first hand who were in some of the accommodation. We heard stories of physical assaults, bullying, drug use and antisocial behaviour in the properties, vermin, properties in a completely awful state of repair and non-existent support.
We will look at those issues in detail. The facts are awful accommodation, no support and the taxpayer is paying a fortune for it. There is something very wrong, isn’t there?
Eddie Hughes: Chair, I will begin by putting some credentials on the table—not to profess any expert knowledge of the subject, but just to explain the position that I am coming at this from.
For the three years immediately before I became an MP, I worked for YMCA Birmingham, a small charity focused ostensibly on providing accommodation for young people, and we provided supported exempt accommodation. We worked very closely with Jack Dromey who was the MP. He had a very strong interest and I pay testament to the excellent work that he did. I still have a very strong familiarity with the area of Birmingham where they have the highest concentration of the types of properties that we will be discussing during the course of today, not least because my son lives in Stockland Green. That is where there is a concentration and that is where the YMCA place was based.
The reason I put that on the table is partly because I spent three years working in this area, not just geographically but in the subject area. I have seen the excellent standards of accommodation that is provided by YMCA and others, but similarly I was approached at the time by nefarious or rogue landlords—people who wanted YMCA to provide the support on their behalf. When I told them how complicated that would be and how much it might cost them, they went elsewhere because they were just interested in making money.
At the time—that was seven or eight years ago—I personally made Birmingham aware of the concerns that I had. We could see that there were people coming into the sector who had no interest in providing any level of support for the vulnerable people who are frequently housed in the type of accommodation we are talking about.
We know, first of all, that there are many excellent providers in the market but we also know, and there is simply no excuse for it, that there are providers who take people in—in fact they go out looking for them to harvest them to bring to their properties—and have no care or no assessment of the level of support that is required.
The YMCA understood the skill set that we had and we would do an assessment of people who wanted accommodation to see whether we were an appropriate provider for them and could provide the support that they needed. All of the cases you described, Chairman, are dreadful cases where I guess no assessment is made and the providers are just focusing on the money.
I take a strong interest in this, but before I became the Minister the Government had already invested £5.5 million in the pilots across a number of council areas where there is a concentration of these types of problems so that we could start to determine the size of the problem and the best solutions to address it. I am glad that that work was carried out in the first place and we have seen good results from it.
The feedback that we have had from the councils that engaged in those pilots has been positive. Subsequently, it is great that we are now in a position to further build on that experience and knowledge. On Saturday we issued the prospectus and invited bids for the £20 million over three years that we will fund.
Do I accept that there are some dreadful cases? I absolutely do. I want to say, for the sake of context, that there are some excellent providers. I know because I worked for one, but the Government completely accept that there is a problem that they need to help address and we will do our damnedest to make sure it is addressed.
Q144 Chair: Do you accept as the paymaster, the DWP, that you are wasting an awful lot of taxpayers’ money on this?
David Rutley: We recognise that there are issues. Eddie has already highlighted the concerns here and we share them. I want to get on record that we recognise that there are challenges. That is with the minority, thank goodness, but there are still far too many issues being surfaced here. There is a genuine sense of partnership working with DLUHC. We have been doing a lot of joint working over recent months. Last Wednesday we were in Blackpool looking at examples of best practice but also seeing where there was definite room for improvement. We are working closely on this and, yes, there are steps that need to be taken now.
I think that the package that was announced in Eddie’s written ministerial statement on 17 March, which is a joint piece of work between DLUHC in the lead and us in DWP working closely with them, set out the framework with which we can make some real difference. There will be a difference in quality but also in value for money, the point that you are driving at.
Q145 Chair: We will pick up on the weekend statement in questions in a minute. On the problems that were explained to us by people who live in exempt accommodation, first—and the Minister just referred to it—is the way that people get into exempt accommodation. There are no checks, no indication about what might be an appropriate house for people who have particular challenging issues.
We were told that people who have been victims of domestic abuse were placed in accommodation with people who previously had been abusers, people who were trying to recover from a drug addiction were placed in accommodation with drug users. This is just not acceptable, is it? You referred to how that could be improved. Do you have ideas now about how that can be improved as a key issue?
Eddie Hughes: If we take the concern about domestic abuse as a prominent case, we have introduced the Domestic Abuse Act. There is a duty on councils now to map the service provision that is available to them, to identify the demand and map the provision that is available to them. We funded that with £125 million, but what is much more important to me is that I have a national expert panel, including Nicole Jacobs who is the Domestic Abuse Commissioner and jointly chairs that panel with me. We speak regularly to people like Women’s Aid to understand how this duty is playing out with the additional provision. More accommodation has come onstream over the previous two years than was there previously.
One of the things that can happen when you are a Minister is that you think that once you have enacted the legislation your job is done. Your job is only just beginning at that point. It is important to me that I understand how that duty is working on the ground and how councils are engaging with it and ensuring that they make that provision. Then it is our duty, and it is beholden to councils as well, to ensure that there is signposting to the most appropriate accommodation for those people.
Chair, the number one objective for me as the Minister and for councils is to raise the standard of all exempt supported accommodation to make sure that good provision is available to everybody regardless of their need.
Q146 Chair: I recognise that there is a new duty. Are you saying, Minister, that councils should check all exempt accommodation to ensure that victims of domestic abuse are not being placed in inappropriate accommodation?
Eddie Hughes: I will give you an example, Chair. I strongly suspect that you are familiar with the December 2021 scrutiny report that Birmingham Council did. It set out a number of recommendations in that report. I think that Birmingham Council is probably the council with the highest amount of this type of accommodation, with approximately 22,000 units. This is a non-partisan perspective that is taken because Councillor Carl Rice who chairs that committee is a Labour councillor. It is a Labour-led authority. Carl and his committee accepted the fact that they need mainstream funding for this work and one of the recommendations is that they check the 22,000 units of accommodation, as referenced in its report.
Q147 Chair: That is Birmingham. Are you saying that every council in the country should be doing checks of this kind on all exempt accommodation?
Eddie Hughes: No, I am not saying that. The reason I am not saying that is that the job of central Government is to set appropriate legislation. For sake of context again, we have 333 councils in this country. I imagine, based on the experience and the information that we have, that this is a significant problem in perhaps 10% to 15% of them. Should we be prescribing from central Government what councils should be doing? Councils are always best placed to know their own area, to know the demands and challenges and to take an appropriate route to it. That is why we fund them, because they know best.
Q148 Chair: If a provider of exempt accommodation says, “It is not up to you to tell me who I can take in”, they can just refuse council intervention, can’t they?
Cathy Page: Referrals are incredibly complicated and what you were talking about was self-referral and advertising on things like Gumtree.
Chair: Yes.
Cathy Page: One of the key things that we learned from the pilots that we ran was that the issue that we need to get into and address is trying to ensure that residents going into any kind of supported exempt accommodation have a support review. Part of the interventions that the pilots carried out was support reviews for everybody entering into supported accommodation. They went to where there was bad accommodation and they ensured that they were talking to the landlords of those kinds of, let’s say, unacceptable accommodation to ensure that those residents were getting a review of what their actual support needs were and that a support plan was done.
As part of the work that we are doing following the announcement on 17 March, we are looking at the ways in which we can encourage and work with local authorities on referral pathways and trying to ensure that people who find themselves in the kind of accommodation we want to drive out have had an opportunity to have a support review and a plan to enable them to get the support that they need.
Q149 Chair: I welcome that, but I want to come back to the point that there is no obligation on landlords to co-operate with that, is there?
Cathy Page: Not currently.
Q150 Kate Hollern: To give you an example of someone who is referred to an HMO or exempt accommodation from prison or probation, the council initially has no knowledge that those people are there. Nobody asks the question: is this person appropriate to move in with the other residents of that building accommodation?
I know that you are saying it is down to councils but councils don’t have the powers and the authority. People are referred in, quite often from out of town because of criteria where they can’t go back to their home place, but there are no checks that the place is appropriate or it is appropriate for the other residents in there. As the Chair said, councils have absolutely no powers in that situation whatsoever and as a result people are being put in an even more difficult situation living in an inappropriate setting.
Cathy Page: That is one of the key issues in the measures that Minister Hughes announced on 17 March where we are looking to see what kind of powers we may need to give local authorities to try to stop this happening. Part of those measures and what we are doing at the moment, in consultation with local authorities, providers and other key stakeholders, is on what kind of powers do we need to potentially introduce to stop this kind of thing happening.
Eddie Hughes: One of the other things that we are doing in our work on tackling rough sleeping is having housing officers in prisons being able to talk to people before they are discharged and identify where they expect to be living and if they don’t have somewhere to live, to identify appropriate accommodation. We get that opportunity to direct them to the best standard of accommodation prior to them leaving and trying to subvert the opportunity for them to be picked up and brought to inappropriate accommodation.
Q151 Chair: The other thing we heard was that there are bad landlords, rogue landlords and downright criminals, and some of them are clearly involved in this area. A number of authorities have started police investigations. Have you talked to your colleagues in the Home Office about the extent to which money laundering may be involved in some of this provision, about whether a national look at it is needed?
Eddie Hughes: No, I haven’t personally, but we are at early stages and I am very happy to consider that option. I will come back to the point I made about the prevalence in a significant but relatively limited number of councils. The reason I mention that is because we have seen excellent work between some councils and some local police. I will continue to cite Birmingham because I am so familiar with it and because of the extent of the provision there. West Midlands Police has worked much better with Birmingham Council during the course of the pilot. There are similarly good working relationships in Hull.
We have seen some examples and I think, Chair, that this gets to the nub of tackling this problem. It is not a housing problem, it is not a DWP problem, it is not a planning problem; it is a bit of all of those things. We see the best outcomes where we have multidisciplinary teams in councils or regions coming together to work to tackle a problem. I think that it is almost better that each council or each area tackles it depending on what their local challenges are but, that said, I am very happy to have conversations with Home Office colleagues to discuss it.
Q152 Chair: Thank you for that. Coming on to the other point that was raised very strongly by people on the visit, we sat and talked to people who said, “I would love to work but I can’t. My accommodation provider has said to me, ‘You get a job, you are out of here because the amount of money you can pay me in rent is nothing like the money I am getting in housing benefit because it is classified as exempt accommodation’.” That can’t be right, can it?
David Rutley: A great example is when we went to supported housing arrangements in Blackpool and they were actively encouraging people to go into work. It is great to see people working in places like Pets at Home and various other retail organisations and progressing in their careers.
The way that the housing benefit is structured is that you will always be better off in work than not working at all. We want to make sure that is the case and we want to incentivise people to get into work. Remember that work is not just about the financial arrangements, and benefits is one element of what people earn, but this is more of a dynamic situation. If we can get people on to their own two feet, they not only get the benefit of being able to have an initial pay packet, get self-confidence, self-esteem, but they can progress in work as well and they can step on and move away from needing the support of other people.
Q153 Chair: I think that we can all agree with that as an objective, but people sat in front of us in the room and said, “My accommodation provider is getting £300 a week in housing benefit for the one room I am in. How can I possibly earn enough to match that?” The landlord has just said, “If you can’t match it, you’re out”. People are not on secure tenancies, they are on licence, which we will come on to in a minute. How can that be right?
David Rutley: There will be other opportunities for people to have accommodation in other settings as well. It is not right that people should be making that sort of assertion. We are trying to say that there is a range of different opportunities for people to have accommodation and once people get into work they will get into a more positive cycle in their lives and they can progress in employment and be able to afford the rent that they need as well.
Q154 Chair: These are people who desperately want to work. One of them broke down in tears in the meeting with us and said, “If I go and get a job, I have to go and find other accommodation, so that is a challenge. I am trying to find a new job, I am trying to rebuild my life, and then you are saying leave the place you are in because they won’t give it to you anymore. You have to find somewhere else.” That is not a great situation, is it?
David Rutley: No. The better option is where you have a landlord that takes care, support and supervision seriously, which we are working very closely with DLUHC and with stakeholders to define. Some of that support will need to be about employment and helping people make that transition.
Chair: We will come on to the issue of support in a minute.
Q155 Ian Byrne: A very quick point is the absolute imbalance of power. We have somebody who wants to go work but they are absolutely stuck in the system and the power lies with the landlords who will not let them go because of the money that can be made. Don’t you think that there is a huge flaw in the system? It is not about your personal responsibility going out to get a job. As the Chair just explained, the system is created to exempt accommodation for the landlords who are maximising profit over the good of the person. That is wrong.
David Rutley: That is not all the landlords, but we are saying that we want to address—
Q156 Ian Byrne: On the evidence we have seen it is.
David Rutley: No, there is a significant minority that are seeking to make profit here and putting that above everything else, but a lot of providers are doing a good job. We should not accept that what happened in Birmingham, where clearly there have been major issues, as Eddie said earlier, is what is happening across the country.
Q157 Ian Byrne: It is not just Birmingham.
David Rutley: No, I understand and I have been to different places too. I am trying to say that there is a challenge and we want to face into it, but it is not every single supported housing provider that is doing this. One of the challenges with what we want to do is to make sure that there are no unintended consequences in what we are doing that will stop those who are doing a good job from carrying on doing that and that is the balance we have to seek to achieve.
Eddie Hughes: Chair, I apologise just in case during the course of this session it becomes apparent that I am an evangelical cheerleader for the work of YMCA, but in Birmingham we had three different types of accommodation. We had off the street hostel accommodation for people who were literally in destitution and then we would move them on to supported accommodation and ultimately to independent living. They would move through our organisation, depending on the level of support and their ability to sustain a tenancy.
To a degree, this is supported accommodation. If it gets to a point where people no longer need support and are able to live independently, you would want them to move on. Frequently the nature of this accommodation is that it is smaller and so if people are prepared and able to live independently, that is the natural course of action but it is our job, locally and nationally at Government level, to make sure that accommodation is available.
Chair: We will move on to the issue of the statement at the weekend and Mary Robinson wants to follow it up.
Q158 Mary Robinson: We have referred to the previous pilots. The previous pilots were identified and funded by Government but there is a bidding process for the Supported Housing Improvement Programme. Is that because you don’t know where the money is needed most?
Eddie Hughes: No, because we are not in a position to be prescriptive about it. I think it is definitely better that when they have read the prospectus and understand the type of service that we are intending to test and we want to develop evidence on, the councils will be well placed to determine whether they are in an opt-in position and feel this demand.
I go back to the point I made previously. There are 333 councils in the country and maybe 50 of them, probably 40 of them, have a significant problem that needs to be addressed by this, and then a much smaller number where that problem is proportionately very significant to them. They will know and be well placed to have access to the information that tells them, not least because if they are working collaboratively with the local police, as an example, they will understand what antisocial behaviour is being driven by the prevalence of this accommodation and so on. They will be able to pull together a dataset in a way that we could never do nationally because they will know their area best. That is the reason for it.
Q159 Mary Robinson: It will be a useful dataset for you to have. Some of the bids will be successful but—
Eddie Hughes: Mary, I am a data enthusiast and wherever we see that we don’t have enough of it, I am very keen that we look for more of it and publish a bit more of it. You can see that since I became the Minister for Rough Sleeping we are now providing more data on the information that we hold. I feel that that is the best way that we can challenge local authorities and drive up good service.
Q160 Mary Robinson: Some £5.5 million was given in funding for the five previous pilots. By comparison, the £20 million sounds smaller. Do you intend to have the effect that you want to from this programme?
Eddie Hughes: I can say this because it is nothing to do with me. We saw that the five councils used that money incredibly effectively. I will keep referring back to the Birmingham scrutiny report. The reason I do this is because this is a non-partisan approach, a Labour-led council saying it thought the money was excellent, it was delighted to have the money. It gave it the opportunity to test and develop new ways of working with the cross-departmental and multidiscipline team. It is talking about mainstream funding from its own resources.
First, it is a significant amount of money because we got a good bang for our buck on the £5.5 million but, secondly, councils have the opportunity to put in some more money of their own where they see value from the experience of the pilots. I think that a lot of councils will have read the submission that we had, the assessment of the effectiveness of those pilots, and will have seen things that they could do to improve provision in their own areas. They may do that from their own funding or they may choose to bid for some of our funding to assist them.
Q161 Mary Robinson: There was a discussion earlier about the ability of councils to take action and have extra powers. Will the Supported Housing Improvement Programme be accompanied by those extra powers? I am gathering that it may not be but some clarification. A lot of stakeholders have told us that local authorities need them to tackle this poor practice among the providers that you have heard about.
Eddie Hughes: I agree with the Chair on so many things, but one of them is about the complexity of this area. We need to tread cautiously to make sure that there are not unintended consequences.
One of the problems with a bunch of legislators is that they think that legislation is the solution to every problem and sometimes it isn’t. Sometimes a little bit less legislation might be a good idea, but we know in this area that those pilots produced good results with the existing legislation. They did not have any new tools at their disposal. They just maximised their use of the existing tools and, as I say, maximised that opportunity for collaborative working across council departments and with other external organisations.
Is it probable or possible that we will legislate? Well, yes, I think it is and I tell you what, Mary, if we don’t I think Bob Blackman might have a plan for us anyway, whether we like it or not. Is legislation a possible contributor to this solution? Maybe, and we need to look at everything.
Q162 Mary Robinson: I think that you would find quite a joint approach among this Committee if Bob Blackman came up with that.
Eddie Hughes: I think I might, looking around.
Q163 Mary Robinson: This is a bidding process that councils have to take part in. Is this the future for any measures to tackle problems in exempt accommodation?
Eddie Hughes: Is a bidding process the future? I would like to think not and the reason I say that is because we give councils the opportunity to see what processes, what solutions work best and that they then implement them, ostensibly from their own existing funding. I will keep saying this, not my words: read the Birmingham Council report. The council itself is saying it should mainstream this funding. I think a lot could be done and what we need to do, Mary, is maximise what we can do with the funds and legislation available because we have seen through those pilots what is possible.
On a return on investment and the figures that Birmingham Council said that they saved through not accepting some bids for housing benefit, that is many millions of pounds. In some cases it feels like the money that it saved exceeded the money that we put into the pilot. There is a return on investment element to this that I think all councils should consider.
Q164 Mary Robinson: Are you expecting the learning from the previous pilots to be part of the criteria in this programme?
Eddie Hughes: I simply cannot praise the councils enough for the way that they have embraced this work already. The people who took part in the pilot and saw benefits from it are continuing lots of this work and we would expect to see that continued except that we are expecting to see that best practice spread out to more councils.
Q165 Chair: On the timing, there are three years for this £20 million to be spent and lessons to be learnt. Does that mean no action will be taken prior to the lessons being learnt?
Eddie Hughes: Chair, I refer you to my point earlier. Bob Blackman might be getting ahead of us with his intention to push us a bit quicker. From my personal point of view, I am ambitious and keen to see whatever progress we need to make, whatever options we need to take, progressed as quickly as possible, but I also realised from my first meeting with the interested parties that there were some conflicting ideas as to what the best solution is to this.
It is not necessarily that we need to arrive at a perfect consensus, because we are not likely to do that, but we need to make sure that there are no obvious unintended consequences from any approach we take that might be to the detriment of the good providers. That is the very last thing I want to do.
Chair: We will move now to the issue about information that we have just been talking about.
Q166 Kate Hollern: I was very pleased to hear the Minister say that he is a data enthusiast. I hope they both are. On that basis, can you tell me how many providers of exempt accommodation there are and from, Mr Rutley, how many claimants?
Eddie Hughes: I think that the honest answer is no. There are many reasons I say that but the prominent main reason is because, as legislators or people considering this topic, we would like this to be nice and neatly compartmentalised but it is not. The things that fit under the heading of “exempt supported accommodation” are many and broad.
For sake of argument, my personal experience was short-term accommodation for mostly young, previously homeless people. That is one part of the spectrum. Another part might be, for example, people leaving prison, people who are victims of domestic abuse, older people. There is a range of types of accommodation that come under this and that is why it is complex. You can’t pull the information from a single dataset, necessarily, because those are very distinct and separate areas.
However, having said that, I think that 2016 was the last time we had a good go at understanding this sector and, Kate, I genuinely am a data enthusiast. I think that the best way for a Government to fully understand and, therefore, design a solution to a problem is to understand more of the maths and the numbers behind it. I am keen, through the research that I will be commissioning, that we have some of those details to answer your questions.
Q167 Kate Hollern: The problem trying to solve a problem is if you don’t have the information it makes it very difficult.
Eddie Hughes: David will answer for himself but—
David Rutley: I am not sure that I will.
Eddie Hughes: —part of this problem is that there is more granular information held by various councils. For example—I will keep referring to it—in the Birmingham Council’s scrutiny report there are some figures that show for between 2015 and 2018, across four years, the number of units of this type of accommodation that are held by a number of comparator councils.
During that period, Birmingham Council’s number of units of accommodation doubled and Manchester’s went down by about 70 or 80. Somehow those councils are able to extract that information. My recollection from the scrutiny report is that an organisation in Birmingham basically issued a freedom of information request to all councils to extract the data. The Government do not hold that data centrally, because that would be too big a problem for us to deal with. It is important that local councils hold that data but pulling it together is no easy task. We will try to do a bit of that because the data is important. Now I will stop talking.
Q168 Kate Hollern: On that basis, you consistently say local councils, local councils. The big problem is local councils don’t always have that information. Do we know how many claimants there are?
David Rutley: We do. Can I call you Kate?
Kate Hollern: That is my name, yes.
David Rutley: Fantastic. David is mine. We can say with some degree of accuracy from the survey that took place in 2016 that there were 233,000 housing benefit claimants in GB and 215,500 in England. That is 2016. On the point that Eddie has just been making, that was based on survey data. The admin data that is held has not been as accurate and I think this at the heart of what you are trying to get to on the claimant side. We have identified an issue in the way that supported housing is recorded on local authority systems. It is not mandatory currently and it allows multiple indicators to be set. As a result, that can lead to an undercount in setting some indication of what the level of supported housing might be. It paints only a partial picture.
Again with DLUHC, DWP has been working with local authorities and their IT providers and has made financial investments there to improve the supported housing data that the Department receives from the local authorities. We want to get that higher quality of data that Eddie was talking about. We are simplifying the data fields and we are making it mandatory so that new claims are appropriately flagged. That will ensure that we have better data on the exempt accommodation. That will take effect as of April this year but that deals with the flow of new claims. It does not deal with the stock, so it will take some time to come through.
To Eddie’s earlier point, we don’t have that data centrally held but we are taking serious steps to make sure that we get a much more accurate sense of what is happening, particularly with the new flow, which will lead to us having a better picture of the stock in due course.
Q169 Kate Hollern: That is a step in the right direction, but I think that one figure quoted was the Government spending £1 billion a year on exempt accommodation. I know through this Committee we have tried to get information from DWP and with no positive result. In fact, we were depending on information that came from FOI from Crisis.
It is a bit of a nonsense really, isn’t it, that this Committee cannot get the information it needs to make recommendations going forward? If the Government don’t have that information, that £1 billion could be three or four times that. It is almost as though the public purse does not matter.
David Rutley: It certainly does matter, for all the reasons that we have spoken about so far. We want to make sure that the Committee is getting the best possible data. We want to make sure that the two Departments have the best possible data to make the best decisions. Over time, the data has not been held as accurately and we are taking steps now to improve that. I think that James has some points to make on that too.
James Wolfe: The main thing to add on the reason that we don’t publish the administrative data is that because—
Q170 Kate Hollern: You don’t publish or you don’t have?
James Wolfe: We do have some data, as you will know from the freedom of information request. The issue that we have is that because local authorities are getting better and better at recording supported accommodation, we don’t know how much of the change over time is a genuine growth in the sector and how much is local authorities reporting better on the accommodation they have.
The Department’s view is that it is not information of a standard that we would publish. We are hoping with the improvements that the Minister has referred to that we will soon have a good time series that will enable us to show what is opening over time in the sector. The 2016 research report that Minister Hughes mentioned showed us that we had under recording of supported accommodation in the housing benefit admin data, so we have been working since then to improve it.
Q171 Kate Hollern: Yes, and of course we know there has been a huge growth in exempt accommodation. 2016 is six years ago and there has been a huge growth in it, so there is still a concern that local authorities don’t have the proper information they need to make informed decisions and the Government do not have a clue how much they are spending on this.
If we move on to Eddie, in February 2022 you stated that you were aware “of a minority of supported housing landlords providing poor quality accommodation and insufficient support for residents”. What number and proportion of landlords are we talking about?
Eddie Hughes: Yes, I remember saying that; I was not thinking about being in front of the Committee when I said it. The point that I am trying to make is that we know in this complex web of regulation that part of this sector is regulated by the Regulator of Social Housing, part where there is care involved is regulated by the Care Quality Commission. The Charity Commission has something to do with it as well.
When you slice up this cake, it feels to me, from the evidence I have seen and from my personal experience working in the sector, that where we experience the greatest number of problems tends to be in non-social, non-commissioned accommodation. That is a smaller part of the cake in the first place and obviously not all of that non-commissioned, non-social accommodation is of a poor standard and would cause complaints. Therefore, I was surmising from that that we are talking about a relatively small sector.
I fully appreciate that there are problems even within those areas that are covered by the Regulator of Social Housing. We have seen them in the press and so on and you have heard about them at your Committee, but they tend to be a very small number of organisations that are regulated that are causing the problem. I think what I was trying to get at was because it is focused on typically non-social, non-commissioned that it is a smaller part of the sector.
There is an assumption on my part that anybody knows what I am talking about with non-social, non-commissioned. Social housing, that housing that has had grant from the Government to allow them to charge a lower rate for their rent, and non-commissioned because councils have the opportunity to commission service provision directly. Where they do they have greater control of standards in provision and so they are likely to be able to push out the number of complaints. That is what I was getting at.
Chair: We will come on to the issue of commissioning and registered providers in due course.
Q172 Kate Hollern: You are saying that you think it is a small percentage. I will pick you up on something you said, because you said it at the last meeting also, about CQC monitoring the level of support. I think you may want to go back and just—
Eddie Hughes: No, care.
Kate Hollern: In care but not in the majority of accommodation?
Eddie Hughes: No, they are not responsible for the support element. They are responsible where there is a care provision.
Q173 Kate Hollern: There is basically nobody supporting that. The evaluation of the exempt accommodation pilot divided providers into three camps—the ideal type, the misinformed and providers of concern. What proportion of providers are in each category? You are going to tell me that you don’t know. But where you have recognised providers of concern, are they still receiving funding?
Eddie Hughes: I think that this is one of the problems that you have when you are writing a report like that, which is understanding your audience or making assumptions about your audience. If we were writing a report just for the members of this Committee, we would write it in a more detailed, technical sense where people would understand what we were talking about, but I think it is better if a Government report is accessible to more people.
The categories that have been used as descriptors are to help ordinary people to understand the delineation between the types of landlord. Those are not technical specifications of the type of people that we are talking about because it is much more nuanced than that, but we are trying to get at that it is not simply a case of good providers and bad providers. There are good providers, there are providers who would like to be good but perhaps don’t know enough or don’t have enough guidance, and then clearly at the other end of the spectrum there are outright bad providers who are simply in it to make money. Our job is to drive up the standards of all of them.
Q174 Kate Hollern: Are the bad providers that we are aware of still receiving funding?
Eddie Hughes: Some will be. There are two questions here. First, our intention is that the direction of travel for those bad providers is that they are bad but improving. Our intention is to drive up the standards. It is not our intention to simply punish people who provide bad accommodation if their intentions are good and they are prepared to work with us to provide better accommodation. That is an example of the unintended consequences that I was talking about.
For the sake of argument, if there is a provider that provides 1,000 units of accommodation and you find problems in five of them, if you were to withdraw the funding from all of its units of accommodation because you were unhappy with a small percentage of it, you would have to find homes for the other people who were in the accommodation.
Our intention is to work with people and drive up those standards but probably a much more important point, as far as the Committee is concerned, is that DWP does not give the money to the landlord. We give the money to the tenant and the tenant gives the money to the landlord. The reason I say that is because it is important that the tenant has the opportunity to decide who they are giving money to. Our job, as national and local government, is to ensure that they have good quality options for people to give their money to.
Chair: I don’t think that is how many of the people who spoke to us in Birmingham would see it, Minister. They would see it that they have no option and we will come on to that again in a little while. We will move on to the issue of the growth in exempt accommodation.
Q175 Ian Byrne: Minister, through the lease-based model large profits are being made in some parts of the sector that are supposed to be non-profit. There are also accusations of profiteering by providers of exempt accommodation. Preston City Council was among those who claimed exempt accommodation was “hugely financially lucrative”. It referred to the exempt accommodation provision as a “licence to print money” as did a member of Bradford Council. The LGA stated that, “Artificially high rents, especially through the lease-based model...established with the explicit aim of maximising investor profit” were causing higher costs for exempt accommodation. Why do you think there has been a marked increase in exempt accommodation in recent years?
Eddie Hughes: Sadly, I think that there are a number of reasons for that. To explain, certainly I was approached during my time at YMCA by exactly the type of people you are talking about, people who are big investors, but we need to appreciate that in creating or providing this accommodation we need money to come into the system from somewhere. The Government will provide some of that, but clearly if there is an opportunity for investment to come in from other people and make what would be considered a reasonable or acceptable profit, we need to clamp down on the cases that you are rightly highlighting where people are making an inordinate amount of profit. That is my intention through the work that we are doing.
To come back again to the scrutiny report that I referred to, there is the interesting point that I made: during the period between 2015 and 2018 Birmingham increased the number of units of accommodation by 92%. It nearly doubled the amount of accommodation that it had whereas in Manchester it dropped by 70% or 80%. I think it was only Sheffield that doubled the number during the same period but from a much lower base.
The reason I am making this point is that strong action by councils has the opportunity to drive some of these people out of the market. I appreciate that it is not everybody and we can see that because Bristol and Manchester have done it demonstrably by taking a very firm line, but I completely understand that some councils will be hesitant because of the technicalities that we talked about of what constitutes more than minimal support and the need for care, support and supervision.
There are some areas where hopefully we will make it easier for councils to challenge but we also see that with the existing legislation and existing funding, some councils have done better than others. That is not in any way to castigate the councils, for example Birmingham, who have the suffered the proliferation. Our job is to work with them through things like the pilots that we have done so far to try to make sure that everybody understands how to maximise the tools they have.
Q176 Ian Byrne: You are sitting there and you are amoral. All you are worried about is putting money in the bank. You don’t care about the sector that you are working in of highly vulnerable people and you have a licence to print money. You are earning highly lucrative profits. How do we ensure that these lease-based providers are ensuring that the most vulnerable in society live in dignity and not squalor? How are we doing that?
Eddie Hughes: You get to the root of my number one ambition, which is to make sure that—
Ian Byrne: How are we doing it?
Eddie Hughes: One of the things that we are doing, as I say, is helping councils understand the impact, for example, of going out and inspecting properties. Councils might think they simply don’t have the money to do that but if they don’t do it we have also seen, with Birmingham as an example, the amount of interaction that they then require from the police or the ambulance service or from other people because of the consequence of not gatekeeping and not investing. It is to everybody’s benefit if they do that. My job is to prove to them that if they take a particular approach that will represent good value for money. That is theme 1.
Theme 2—and we see this through a number of things that we are doing—is the overlap of my areas of responsibility. For example, I mentioned making sure that there are housing officers in prisons who direct people when they are leaving prison to the most appropriate and highest quality accommodation available to them. We are investing heavily in care leavers, first, to try to get them to stay with their foster carers through the staying put and staying close programmes but when they leave care and have to live independently that we are directing them to the best quality accommodation. I fully appreciate that that accommodation has to be available and part of our job is to try to make sure that it is.
Q177 Ian Byrne: Let me go back to this person who has no morals and all they want to do is take money from the taxpayer and put people in squalor with absolutely no concern about the individual. Aren’t you worried, like I am, terrified, with some of the evidence that we have seen of how people are living and getting treated, not just in Birmingham but right across the country?
Without legislation, without teeth—we have been here before with you, Minister, where the light touch and the seeing-good-in-people elements of your personality don’t wash sometimes because we know that there are nefarious people out there, privateers who want to absolutely fleece the taxpayer. How do we drive them out?
Eddie Hughes: I fully appreciate that I do have a tendency to be overoptimistic about these things, but in this particular case I could point to councils who have done an excellent job of doing exactly the things I have just described. For example, the work that Hull has done, through the pilot, through existing legislation, has demonstrated that it is possible to drive out poor providers. Bristol has done it.
Q178 Ian Byrne: Do you have any names of these providers that have been driven out? Do you have any numbers?
Eddie Hughes: I could get some details for you. Bristol is another good example. Bristol took part in the initial pilot and when we extended it said it did not need to be part of the extended pilot because it had developed some working practice that it thought was effective. Bristol is one of the councils that I would like hold up because it has taken a very robust approach to assessing people to try to make sure that it is not letting rogue providers in.
On the one hand, Ian, I do not deny that I have a tendency to be over-optimistic but I feel I can evidence my optimism with some great work that has been done by councils.
Q179 Ian Byrne: Let’s visit your favourite place then, Birmingham.
Eddie Hughes: I am going to come to Liverpool during the summer to see you. I am coming.
Ian Byrne: You have an open invitation; I told you that. When we visited Birmingham, one thing which particularly frustrated the neighbourhood groups was the continuing expansion of providers who had been judged non-compliant by the Regulator of Social Housing. In Birmingham, the four largest providers of exempt accommodation—Reliance, Concept Housing Association, Ash Shadada Housing Association and Sustain UK—who together provide 71% of its exempt accommodation, have been judged to be non-compliant. These providers are still expanding. For example, Concept Housing’s income from exempt accommodation trebled in the last two years and its provision threefold. How and why are these organisations able to continue providing exempt accommodation when they are non-compliant?
Eddie Hughes: I am terrified that I am going to continue to exhibit optimism, so instead I will turn to Cathy for some support, but I refer you to my previous point. Our intention is not to punish suppliers who are non-compliant. Our intention is to work with them to try to drag them towards compliance.
Q180 Ian Byrne: It is like landlord licensing; we have the same conversation. I am not saying that these companies are rogue companies—it is not for me to say that, but for the tenants to say it—but without legislation, without some sort of heat, how do we ensure that these providers or rogue providers will not come anywhere near?
Eddie Hughes: I think Cathy might be able to give us a more balanced perspective.
Cathy Page: Eddie is absolutely right about the fact that we should be trying to bring those organisations up to a standard. If we make regulatory judgments and try to get them out of the market or stop people coming into the market, you have a significant impact on supply. Just having a judgment in and of itself is not necessarily something we should then say you cannot operate as a supported exempt provider. If we did that then judgments that have been made on responsible providers of supported exempt accommodation would be immediately struck out and you have a big supply problem.
Q181 Ian Byrne: Why would a responsible provider not want to be compliant?
Cathy Page: It would be compliant, but compliance covers quite a range of activities. The Regulator of Social Housing is there to try to ensure that the governance and viability of the organisation, and coming later also on consumer standards and so on, are adhered to.
When you come to supported exempt accommodation, you have a level of complexity underneath that where the Regulator of Social Housing would not have within its remit the absolute ability to get rid of it and to say stop. At the moment we are saying that the regulator has failed a number of registered providers. They have worked with them to try to bring them up to a standard that is acceptable.
For example, Prospect in Birmingham worked with the regulator for some time. It continued to get judgments from the regulator and then withdrew from the sector because it knew that it could not meet the standard. It subsequently deregistered as a social housing provider and took itself out of the supported exempt market. There are ways of trying to continue to work with a registered provider to get them to improve their quality, governance, viability and consumer standards.
Q182 Ian Byrne: You have made very good points. It was said to me that the exempt accommodation market is like the wild west because the legislation is not fit for purpose and privateers are coming in. Would you say that is wrong?
David Rutley: Can I come in first and then over to you, Cathy? We were in Blackpool last week and spent of time walking around looking at different providers’ work and talking to people from Blackpool Council. It was really clear—and this is an example of what Eddie talked about before—that there is a good number of councils that are using existing powers to keep people out who either don’t have the right motives or don’t have the right model to provide the amount of care that is required.
Q183 Ian Byrne: You are saying it is there?
David Rutley: No, I am not saying it is there completely. I am trying to say that there are examples of where councils are doing a good job being able to rebuff the advances of some of these disreputable people that we are all worried about. We need to spread best practice and, as Eddie said, we need to raise the bar as well. Cathy, over to you. That was just my experience last week.
Ian Byrne: That is a very good point, so I will finish now, Chair, because we are talking about councils having the capacity to do that and making sure that again fits into central Government funding.
Chair: We will come back to the issue of local authorities and their role in due course. We have talked quite a bit about rent levels and funding issues. Florence Eshalomi wants to pursue those further.
Q184 Florence Eshalomi: Good afternoon, everyone, and my apologies for lateness. Following on from that, in addition to the fact that some of the registered providers, from what we have been hearing in our inquiry, are not fit for purpose, they are not fit for purpose but yet they continue to make large amounts of profits.
The issue of profiteering in this sector is quite alarming. In one of our evidence sessions West Devon Council gave us an example of a property being used for exempt accommodation and it was first sold for £6 million and then later on the same day that property was sold for £18 million to an investment company in Jersey, so that ultimately they could charge higher rates.
We are seeing a case of properties that are not fit for purpose, offering no support for their residents, but yet they continue to make profits to the point where any fines or action taken against them are insufficient because of the amount of money they continue to make. Do you think that the rents being charged for the exempt accommodation should be held to an independent standard to help curtail the inflated claims that these providers are making?
Cathy Page: To pick up on the point about rents with social housing, rents are regulated. Most of the rents for the majority of providers in supported housing are regulated. Rents in affordable and social housing should comply with the Regulator of Social Housing’s rent standard. That is regulated. In non-social housing, including charities, rents are not regulated but they should always be reasonable and provide the value for money. When you are talking about registered providers, you are talking about social housing, you are talking about rent regulation and that is regulated by the Regulator of Social Housing. However, we do know that rents in supported housing in the sector vary for lots of different reasons.
Q185 Florence Eshalomi: They vary and are you aware that providers then use FOIs to find out what others are paying for rent and then whack theirs up? In our visit to Birmingham we found that some providers were charging £244 per week for their rent. On top of that, they were also charging large amounts for service charge and additional provisions. In some cases the residents were not seeing those charges.
Eddie Hughes: A couple of things. First with regard to the freedom of information request it would be understandable to a degree. If I were a new and good-quality entrant to the market, it might be helpful for me to understand what the market is charging and what the council is paying, to help me to work out my business model to see whether this is a market that I would be able to enter. I can understand why people might use the freedom of information request.
Similarly with regard to how a property is sold. If I sell my house as a normal residential property and I get £100,000 for it, or if I sell it, for the sake of argument, with a tenant in place and that is a commercial entity, it might be on the market for more than a normal residential property because there is a business element and projected rents for 30 years and so on. Therefore, it would not be surprising that a property sold on one day could be sold subsequently by somebody who is taking a business interest with a particular business model in place.
Our job is to do two things. The first is to try to make sure that rents charged are appropriate to the type of accommodation. I go back to my time at YMCA. One of the reasons why we thought that it was completely appropriate that we were entitled to this increased payment was that the types of residents that we had would frequently cause damage to the property and we would be replastering and replacing doors and things like that. That was par for the course. Therefore, it is not unreasonable that they do charge higher rents and I can completely understand why people would use an FOI and I can completely understand why a business model versus a residential model might lead to increased profit.
I will come back to Ian’s point, though. I completely and utterly agree with you that we should be trying to drive out people who are purely trying to make excess profits from the most vulnerable people in society. Our intention is to work with councils to understand what tools they can have to deploy and where necessary, if it is necessary, to change legislation to help them do that.
Q186 Florence Eshalomi: Would you not say, then, Minister, that this is a largely financially lucrative area for people who continue to abuse the system with taxpayer’s money but at the end of it they are not even providing a service that some of the most vulnerable people need in that accommodation? That is what is worrying, when you have the lead of the council saying that he needs to see action taken in that area so that you do not see providers making ridiculous amounts of profits, basically exploiting people, exploiting rent that should be going to support people. Instead they are doing that to whack up the rent that they know that they can legitimately charge from councils.
Eddie Hughes: I utterly and completely agree with what you are saying. I would also say that with an organisation like YMCA, it definitely was not making ridiculously excess profits. They were offering a good level of accommodation and probably at comparable rates of rent to some of the rogue providers that you are rightly highlighting.
I am saying let’s proceed with caution to make sure that whatever legislative changes we make, if indeed we make any, do not have the unintended consequences of driving YMCA and other good providers out of business as well. I am nodding in complete agreement.
Q187 Florence Eshalomi: You are open to that. The good providers that appeared before us did say that they would be supportive of an open-book approach to rent claims. Is this something that you would favour across the sector?
Eddie Hughes: I am worried about treading on David’s toes, but from my personal point of view and from my time at YMCA, I would have had no problem with us adopting that open-book approach because we would have been able to evidence exactly why we were charging the rents that we were charging. I personally would endorse that and I hope that David will not shoot me for saying that.
David Rutley: Can I come in on that point? As you are pointing out, this is a complicated and complex area. The Chair has already highlighted that. You pointed out some issues around the leasehold model, which is not uncommon in different areas. Remember that on the lease-based approach, that could be people leasing to a regulated or a registered body such as a housing association. For the non-registered providers, they are not subject to the rent standard but there are restrictions that are referred to by the rent officers. There are different mechanisms in different areas of this market that we need to think about.
Would we be open to an open book? Yes, in principle. We need to understand what that exactly means, but transparency is very important so that we are clear about what people are trying to do there. However, that alone will not be enough. The work that we are trying to do jointly now, particularly around the standards, and also the definition of care, support and supervision is going to be key, will help drive out and disincentivise people to come in here where they might see, as some of you highlighted, that they can make better profits in other areas. That is not the aim of this area. We have made exemptions here because there is greater need. That is where the funding needs to be provided, to help those in need, not shareholders.
Q188 Florence Eshalomi: You would support that, then, because one of the other things that we saw—and again this is within what is currently allowed for—is high benefit payments for exempt accommodation, yet that money is not being used to fund supporting activity for people who are so vulnerable. Would you support a change and maybe flexibility in that rental payment to support people who are in genuine need but they are not receiving it because all the money that they are eligible for goes straight to the rent?
James Wolfe: Returning to the announcements that were made in March, we have said that we are looking at the definition of council support and supervision and the housing benefit. There is an opportunity to separate two slightly different things here. In order to operate in this sector, people should have to demonstrate that they are providing some standard of care, support and supervision. We are talking to lots of different organisations and local authorities about how to make that work in the right way so that we can know that this is the right type of accommodation.
There is then the question about what is the right amount of rent for that accommodation. The point I want to add to the contributions that have been made is that what we want to do is to make sure that councils can address those providers but still have somewhere for those tenants to go, because I am always conscious that the housing benefit entitlement is the entitlement of the tenant. We need to manage this in such a way so that we do not end up with tenants not being able to pay their rent, but we enable councils to have choices about where those people go, which we cannot do by just restricting the rent that we pay them.
Q189 Mary Robinson: A supplementary on the idea of FOIs. You can understand, Minister, that businesses because of the business model are trying to maximise their profits and using FOIs to do so. Does it not bother you that in doing that there is almost a collective nature to this that in any other business might lead us to think that there was a cartel operating? Does it feel like that to you?
Eddie Hughes: I want to be very clear about something. I was not suggesting that they use FOI to maximise their profits, I was suggesting that they use FOI to see whether their business model would allow them to be entrants to that particular market. If they do the maths and they determine that, for the sake of argument, they need £300 a week in order to make their model work, they do an FOI and they know that the typical market rate is £250, they will say, “No, this isn’t the market for us and we need to pull out”. I like the idea of new, good-quality providers being able to enter the market if they can afford to do so at that price point and provide good-quality accommodation.
Q190 Mary Robinson: Thank you. I did understand that that was where you were pointed; I was not assuming anything else. It is around this model that does seem to smack of a bit of a cartel if the highest amount of profit and highest rent can be collectively set.
Eddie Hughes: I understand the point that you are making and I think that it is for councils to determine what is the appropriate level for rent in their area as best they can and to try to control that. That is something that Government could not be prescriptive about, because not only are we talking about 333 councils, but we are talking about X number of wards within those areas and focusing down on what is the market rate for that space. That is certainly not something that we could control and is something that councils are best placed to determine.
Chair: I thought that the local housing allowance did that, Minister.
Eddie Hughes: Okay.
Chair: We will move on to the issue of support.
Q191 Andrew Lewer: Since the ring-fencing of the Supporting People programme was removed in 2009, the lack of steady funding has meant that providers that we have been hearing from have been relying on alternative sources of funding such as charitable donations and service charges levied on residents to pay for support that they get. What is your assessment of the impact of the removal of dedicated funding has had in terms of the support that people are getting?
Eddie Hughes: Part of my understanding of how they things work—and obviously, Andrew, you are incredibly experienced with regard to local government—is that it is not for Government centrally to be prescriptive. I was, if my memory serves me, the councillor on Walsall Council responsible for adult social care during the Supported People programme and possibly at the withdrawal of the ring-fencing.
We provided that funding. Initially it was ring-fenced and that was for central Government to determine how much money local councillors should be spending on something. Then we removed the ring-fencing and you allow councils the opportunity to best determine the need for provision in their area. Councils then have that opportunity as to how much of that money they spend on support services.
That seems completely right and proper to me. It feels to me that one of the things that councils seem to frequently be complaining about, particularly with us offering various funding pots, is that we are controlling what they should be spending their money on by asking them to bid for various funding streams, whereas it is best, through the general funding settlement, that they are allowed to determine their own priorities locally. I would say, would I not, from a semi-political point of view, that my recollection is that that funding has increased by about £3.7 billion since the previous financial year. We are providing funding and I think that it is for local councils to determine.
Q192 Andrew Lewer: Yes, you are right, I remember when this ring-fencing was withdrawn and that was the argument. Would you not see that that slightly flies in the face of the announcement that you made this weekend about a £20 million pot that you have to bid specifically in for support?
Eddie Hughes: We have seen, as was discussed earlier, a proliferation of this type of accommodation in certain councils. We have road-tested the idea of what works, through our initial £5.5 million. This sounds like a funny way of putting it, but if councils have got out of the habit or have not engaged in particular practices that might help them control this area, I think that it is probably no bad thing for Government to provide at least an element of funding to help them demonstrate that if they took a different course of action, they would have an improved outcome.
As I say, and I am regularly referring to it, in the case of Birmingham Council, we have provided it with some money. It has demonstrated that there are other ways of using existing legislation to drive a better outcome and it is so convinced of it that some of the Labour councillors are suggesting that it mainstreams the funding from its own sources.
Q193 Andrew Lewer: It is a sort of getting-back-on-track fund rather than a new funding stream.
Eddie Hughes: Initially our determination is to say, “Let’s prove to you what works and you can determine whether you engage it in the future”. I am delighted to say that Birmingham and other councils have.
David Rutley: With the care, support and supervision, providers can draw on other sources of funds as well, cross-subsidising funds from other profitable areas like a housing provider, for example, or if they want to do fundraising if they are charity or whatever it is, there are different sources that they can draw from. What that does is it also shows their commitment to want to make care, support and supervision an integral part of their business model.
Q194 Andrew Lewer: However this money makes its way through, one thing that has come in for a lot of criticism over the years was the definition of a “more than minimal” support standard. Given that that has been criticised so heavily and you are providing this extra funding and so on, what should the definition of support be?
David Rutley: That is what we are working on. We are working very closely with DLUHC on that but, as importantly, working with stakeholders. There have been a number of engagement sessions so far with stakeholders to help to try to determine what these standards need to be. We need to continue that work at pace because if we can define them better we will get better levels of support and we will also drive out the people who have already been highlighted who really do not care and are providing a very minimal level. We want to be able to move beyond the interpretation of case law to much better defined standards on care, support and supervision. We are determined to do it but we want to work with the sector and with stakeholders in it.
Q195 Andrew Lewer: You are working on redefining support standards. How will you then ensure that the people most in need and the people in question are actually receiving that support?
David Rutley: We will put Eddie on to them.
Eddie Hughes: It will require councils to be able to understand their market, understand their needs and to make sure that first of all people are assessed when they engage in any type of accommodation to determine what level of support they need. We had to signpost some people at YMCA to alternative provision because we simply were not best placed to deal with their needs. If all providers were adopting that approach, we would be in a better place. Let’s come back to my data enthusiasm, which is the review that we are going to do of the sector so that we understand its size, the demand and its associated costs. That is going to put us in a much better place to be able to inform those decisions from a national Government perspective.
David Rutley: When I said that we would put Eddie on to them, not only would we do that but there are going to be new powers as well. There needs to be enforcement too.
Andrew Lewer: DLUHC powers.
David Rutley: Through local authorities, yes. There will be powers put in place too. The package that Eddie announced was standards, powers and then the definition that we are working on with DLUHC and stakeholders on what is care, support and supervision. Get those three together and we can motor on and drive up standards.
Q196 Andrew Lewer: You have the funding, you have the redefinition of standards and you have the new powers to focus on the people who should receive that support. The final part of that jigsaw is the staff who provide that support. We have had quite a bit of evidence that support staff in this particular field have a huge turnover, lack of continuity, pay levels are quite low and, as a result, morale is as well. Therefore, the final piece of the four things is any plans or views on how your support for the support staff can be improved or how you would ensure that staffing is at the level that you would need to deliver this.
Eddie Hughes: I am looking at Ian, thinking that he will castigate me for my optimism again. I do not doubt that there are many examples of the type that you have just described with regard to high turnover and underpaid staff. I would warrant that that is most likely to be the case for those poorer providers and particularly for the rogue element. It would not be surprising because that would align with their determination to maximise profit regardless of outcome for the people who they are caring for.
Under no circumstances am I saying that everybody who worked at YMCA was as happy there as I was. I absolutely loved my time, but certainly we invested in our staff. We were keen to hang on to them because there is an associated cost with replacing staff, advertising and so on. Why would you expose yourself to that when you are better off investing in and supporting your staff? As a consequence of that, we had many members of staff who had been with YMCA for a very long period of time. I completely accept the point that you are making. I hope that a natural consequence of driving up standards is that we will see staff turnover reduced and professionalism increased.
Q197 Andrew Lewer: Is it anticipated that some of the new powers that you have been talking about in terms of targeting the right people would also provide for ensuring that staff were trained and—
Eddie Hughes: That is definitely one of the elements that we need to consider, I agree.
Q198 Chair: Coming back to your favourite city of Birmingham.
Eddie Hughes: I am a Brummie, Chair, I cannot help it. I am not saying that being a Brummie is a bad thing.
Chair: You join your ministerial colleague in that. I could not resist that.
Coming back to when we were in Birmingham, we were shocked to hear that some of the residents of exempt accommodation telling us that support amounted to someone going in the door, shouting up the stairs, “Are you all right, then” and walking out and that was it?
Eddie Hughes: Chair, it is almost worse than that inasmuch as I could trade several other examples where I understand that there are people who have provided a loaf of bread and some jam and left that on the table and they feel that that is enough provision to get them over the more than minimal level. I do not doubt that we could identify many examples of poor support, super low level and inconsequential.
Our job collectively, you as the Committee, me as the Minister, national and local government, is to get together to work out how we determine appropriate levels and, more importantly, that people are assessed for the level of support that they require when they come to a property.
Q199 Chair: Yes, that is important. The National Housing Federation said to us in evidence that you have to see this in the wider context of the accommodation available. David Rutley said earlier to us that some people probably do not need the support as they move on, they need to move on to more self-contained accommodation that they can manage themselves but often that is not available. What we were told is that people are trapped in exempt accommodation because the move on simply is not there.
Eddie Hughes: If I start with the overtly political line and say that we have £11.5 billion through the Affordable Homes Programme and we are determined to drive up the amount of social housing and 180,000 affordable homes through that programme, that would be my ministerial response, my immediate ministerial response.
Moving through the gears, I would say that one of the things that I am most proud of or most excited about, given my previous experience of working in the sector, is the £400 million-odd that we are putting into the Rough Sleeping Accommodation Programme to deliver 6,000 homes by the end of this Parliament. I have already seen some of that accommodation and that is exactly the type of accommodation that people would move into. If they were in poor supported accommodation, they could move into—I think that we have delivered over 2,500 homes through this programme already. It is properly heart-warming.
I keep citing a scheme that I saw in Shipley, where there were some guys who had been in and out of the rough-sleeping community for a number of years. They were just delighted now that not only did they have their own key to their own front door but because of the accommodation that we provided and the support that goes with it, frequently through the Rough Sleeping Accommodation Programme, they were able to sustain that tenancy and they had been able to stay in that accommodation for longer than they had ever held a tenancy previously.
To move to the next step, I am an enthusiastic supporter, particularly of the work—in fact, not only of the work that Andy Street has done. There has been great work done in Liverpool. I am glad to be not talking about Birmingham; let’s talk about Liverpool and the Housing First pilots, which we have extended the funding for. I read recently about some of the successes that they have had in Liverpool. They had a few problems getting people to bring forward accommodation, but I saw even in my own constituency where Walsall Housing Group, who is the main provider, had some hesitance because it is a general-needs provider and it was not used to working with former rough sleepers or homeless people so it was a bit hesitant. However, when it saw the support that was available to help those people sustain their tenancy, it was an enthusiastic participant.
We have extended the Housing First programme, we have the Rough Sleeping Accommodation Programme and we have the £11.5 billion. I fully accept that that is not going to solve every problem but it is a significant investment on the part of the Government to provide accommodation at different tenure types and even different fidelity of Housing First. There are some people who are absolute purists and see it in a particular way and other people who see it in a lighter way.
While I am throwing around my praise for other areas, I am meeting Andy Burnham either this week or next week to discuss generally my review of how we are going to tackle rough sleeping and I am very keen for his support. This is not even mildly politically partisan. I am happy to celebrate the success wherever it is to encourage and support it in all parts of the country.
Chair: We need to do more, I am sure you agree.
Eddie Hughes: We do. Chair, you are absolutely right but one of the other things that has happened is that since Michael Gove became our Secretary of State in September last year we have seen a change of tone from the Government as well. Michael is a very experienced operator. He has been a Secretary of State for a long time, he understands how the levers of government work and he has been talking about the need for more social housing and he is the man in charge, so we should be celebrating that as well.
Chair: We move on now to Bob Blackman, who you have already mentioned.
Eddie Hughes: I am a big Bob fan.
Q200 Bob Blackman: That is a good start. I apologise if this has been asked already but one of the concerns that I have is that for people who are vulnerable and therefore placed in this exempt accommodation, the housing benefit to pay their rent goes direct to the landlord or the provider. Therefore, there is a direct incentive for the provider to prevent the individual from getting a job and then reducing the housing benefit.
Are you proposing to do anything about that particular trap that there is right now? We heard this in Birmingham from several people and, quite frankly, some exorbitant rents being charged and going to the provider rather than the actual tenants who are there.
Eddie Hughes: Ian did talk us through some of these points. Very briefly summarising, one of the answers that I gave was my own experience at the YMCA where we had exempt accommodation and people would move through the system to ultimately independent living, still within our organisation. Some of the best providers completely understand that it is in everybody’s best interests that people are in the appropriate accommodation to them at the time depending on their needs but it should be in all of our best interests to move them through the system to a point where they can sustain a tenancy independently.
David had some interesting comments to make, which he will summarise.
David Rutley: We did talk about this before but we have made sure that there are work incentives in place. We have set out already that we want people to be better off in work.
Q201 Bob Blackman: I completely accept that, but there is a direct disincentive to the provider to allow people to get a job, almost to the point that some of the evidence that we have heard is people being told, “If you get a job, you’re out, mate. You’ll have to find your own accommodation because we no longer want you. We’re getting the housing benefit and if you go, we’ll get someone else in and we can claim the housing benefit on them”.
David Rutley: We do not want that sort of revolving door but there are some more unscrupulous providers that are in this space for reasons other than wanting to help the most vulnerable. We are taking broader steps, as we have highlighted in the meeting so far, to improve regulation and set the standard on care, support and supervision, which hopefully over time will drive people out who do not have the right motives. There are the right incentives there through the benefit system to help these people. As I said earlier on, with 1.3 million vacancies, there are lots of opportunities now for people to get on their own two feet to start with and then progress in work and that is what we need to do, provide that wraparound support.
Eddie highlighted the YMCA a few times and the amazing work that it does. We were in Blackpool on Wednesday and there were some great examples there as well. We were at the William Lyons House and they had a really joined-up approach that was set up by Blackpool Coastal Housing, which is an arm’s-length body within Blackpool unitary authority. It was classy work.
What we need in a way is for local authorities to use their existing powers, their sharp elbows, to keep people out that they know are not doing the right thing. If they are already in, there is a challenge and that is what we see in Birmingham and that is why the work that Eddie in particular is leading will be critical. We are right there with him wanting to help raise the bar across all the standards, particularly the ones that are vital for the housing benefit in terms of care, support and supervision.
Some of this is about getting the right players in place to start with. Over time we are going to have to raise the bar, Bob, so that those who are less scrupulous and are wanting to make a quick buck are not incentivised to come into this space.
Q202 Bob Blackman: One of the things that we have seen, for example, is adverts in the press saying, “Accommodation available” and people just respond to the adverts rather than being assessed and going through this process. There seems to be no regulation on that at all.
Eddie Hughes: One of the points that I was making is that people come to this accommodation from different routes and it is our job to make sure that whatever route they are coming through they are signposted to appropriate accommodation. Through the Domestic Abuse Act I am working with the Domestic Abuse Commissioner, Nicole Jacobs, to make sure that that is implemented in such a way that councils know where the good-quality accommodation is and signpost people to it.
We have housing officers in prisons directing people. If we try to cover all of the routes through which they are most likely to end up in this accommodation and make sure that those people have a collective interest in signposting them to the best, we will certainly make improvements. I do not doubt that there will always be nefarious providers.
David Rutley: We are mirroring that within DWP as well. We are looking at what we can do to help prison leavers in particular—that approach to a departure lounge where people can get that wraparound support for housing, work or at least benefits and move on with a greater degree of confidence after leaving prison.
Q203 Bob Blackman: At the moment there are three different regulators and to call it light-touch regulation is to put it mildly. In terms of the Regulator of Social Housing, at the moment there is no guarantee that the quality of housing is any good. People can just register with the Regulator of Social Housing. At the moment if you register with the regulator, from the DWP you get a bit more money. Why is that? A bit more funding because of that.
David Rutley: There is no mention of funding for the individual. The tenant gets the same amount.
Bob Blackman: The provider.
David Rutley: In terms of the housing benefit regulations, they have been created over time. For those providers who are registered providers, the local authority will receive the complete amount. If they are non-registered, then the way that the housing benefit regulations are set in place, the local authority will be reimbursed by DWP but it will be up to the amount that the ROD, the rent officer determination, is set. If people are in vulnerable situations, there will be that level set plus 60%. This is the way that these regulations have been put in place over decades.
Q204 Bob Blackman: The plus 60% is the key, but not providing decent quality housing.
David Rutley: These regulations have been put in place over time. The steps that we are going to be putting in place at pace, with stakeholder support, will be important and then we can start looking at some of these other broader issues as well. However, the top priority is what was set out by Minister Hughes on 17 March.
Q205 Bob Blackman: One of the answers to this could be that all exempt accommodation is commissioned by the local authority. Do you think that that is the right route forward or should we carry on with this rather mixed market where anyone can bid in and provide this accommodation?
David Rutley: Apart from the fact that we know that there are rogue landlords and providers in this space that we are not happy about, we also know that it is not as if there is a huge supply of supported accommodation. I do not think that any of us want to block off avenues for increased decent supply, good supply, and I think that a flexible approach is broadly right. However, what is clear is that we need to crank up the regulatory environment and make it better.
Q206 Bob Blackman: The anecdotal evidence we got from Birmingham was that you can buy a family home for £200,000 and say that it is going to be for supported accommodation. Suddenly the value increases to £250,000 overnight because they knew that they can milk the system. That to me suggests that there is a fundamental problem with the way the whole things works.
David Rutley: Eddie knows Birmingham better than me, but what I would say is—
Q207 Bob Blackman: I do not; I am not a Birmingham MP but we had the opportunity of visiting Birmingham—
David Rutley: Neither is Eddie, but he is an oracle on many things, including Birmingham.
I know that you have been to Birmingham and seen the situation there and clearly there are big challenges in Birmingham. That is not true for the whole of the country. There are other areas where local authorities have been able to find themselves in a different place based on the existing powers. I do not want to pontificate on Birmingham when I sit next to Minister Hughes. He knows more about it than I do.
Q208 Bob Blackman: Do you agree that local authorities should commission this exempt accommodation, therefore saving the public purse quite substantial amounts of money?
David Rutley: What I have said is that it is important that we have had a flexible approach around different mechanisms to get the supply in. Broadly speaking, that is something that we need to respect. However, local authorities have an important role to play and they need stronger powers and a clearer set of regulations. I will hand over to Eddie on that.
Eddie Hughes: Even during the heyday of supporting people, we would not have had solely commissioned accommodation, so I do not think that there is any need to head in that direction, given the fact that we never did previously.
However, I would also say that it strikes me—and I hope no councillors are offended by this—that sometimes they are not the most agile in responding to demand and market conditions and it is probably no bad thing that there is not an unnecessary barrier to entry with regard to having to be a commissioned provider. If you miss the commissioning slot, you therefore do not have the opportunity to provide high-quality, appropriately priced accommodation. Sometimes the market can be a bit more agile than councils can be in terms of letting people in. Would I ever want to see a fully commissioned sector? No, I would not. We have never had it and I do not think that it needs to be at that level. There is room for new providers to come in and a degree of agility that councils do not have.
Q209 Bob Blackman: Would you accept a position of registration with local authorities? One of the problems at the moment is that if it is supported accommodation it is exempt from HMO requirements. Therefore, a lot of rogue landlords are realising that this is a great way to pile people into unsuitable properties and charge exorbitant rates.
Eddie Hughes: We come back to the point that we discussed previously about the need for greater data. There is simply no doubt that councils need to understand what provision exists locally and what the demand is for it and then we can fit the supply appropriate to that. This is a view that the Government are taking across the piece.
For example, through the private rented sector White Paper that I published last week, the idea that we are going to have a landlords portal so that councils understand where their privately rented properties are will help them focus down their finite resources with regard to enforcement. I think that that is no bad thing.
Chair: Moving on to the issue of regulation, which we have touched on to a degree.
Q210 Darren Henry: On 28 March 2022, the Committee heard from three regulatory bodies that were overseeing exempt accommodation. The Regulator of Social Housing saw 57% of exempt accommodation but did not regulate the support aspect. The Care Quality Commission reported and Charity Commission commented on the lack of regulatory oversight and is seeking more granular data from charities. The current regulatory structure is complex and confused, we think. Regulators say that they lack clear knowledge of how much exempt accommodation they regulate and that there are gaps in their remits. How will these gaps be addressed?
Eddie Hughes: There are two or three things there. I refer you back to the point that I made about we—we as the Committee and we as the Government—would like to sometimes compartmentalise things into easy brackets so that we understand how it operates. However, this very generic term “supported exempt accommodation” covers a multitude of different types of provision. It is no surprise, therefore, that there are a multitude of different regulators that are involved, all of the people you mentioned. If there is a care element the CQC have some responsibility. However, I do not disagree with the Chair with regard to the fact that this is a very complex sector and anything that we can do to simplify it would be welcomed, first the data gathering exercise so that we can understand the size of the sector, the demand and its cost.
Secondly, one of the things that I read, or that I felt when I read the evidence session that you are referring to, is that they want to collaborate. These different regulatory bodies want to work with each other and already do so to make sure that they operate in the best way that they possibly can, given the restrictions that apply to them at the moment.
First, they are already intending to improve the way that they work together. Secondly, we as a Government, once we understand better through data the problem that we are trying to solve, and through a continuation of the pilots that we are talking about, will be best placed to figure out what is the best intervention to make.
Q211 Darren Henry: Do you have a timeframe on when you would expect reasonably to have gathered that data to make a decision?
Eddie Hughes: I am going to turn to Cathy here to ask do we know.
Cathy Page: There are two things that we are doing. First is the formal data that Eddie has mentioned. That is being commissioned and that will take slightly longer. What we are doing, following the announcement on 17 March, is we are working with stakeholders across the supported exempt environment and also with local authorities. We are exploring different options for the way in which we can look at the regulatory landscape that there is and where are the gaps in it. As you have said, there are potential gaps. What we are doing at the moment is gathering information from local authorities, from regulators, so that if there were an opportunity and when we are ready to legislate, that data and that information has already been mapped. We are working to map the regulatory framework and where the gaps are.
One of the things is the bit about the support that is provided to residents. The definition of care, support and supervision appears to be a gap but we are looking to work with the regulators to see exactly how we can layer the different regulatory regimes so that the gaps can be closed to ensure that residents are not being exploited where there is a regulatory option in place to make that safe for them.
Q212 Darren Henry: That is good work but it would be useful for us to know when that is likely to happen in terms of that data being gathered. Moving on, we heard calls for providers to be accredited and for them to be licensed. Would you support measures like that, Minister?
Eddie Hughes: The question is what is the most effective intervention that we can make. There is some accreditation. Depending on whether that is voluntary or not, rogue people will not sign up to something if they do not have to. Therefore, what we need to do is to determine, if we are going to flex our legislative muscles, what it is that we would need people to sign up to to maximise the impact without driving out people through overburdening them. I understand the point that you are making and it is certainly something that we need to explore.
Q213 Darren Henry: Thank you. Birmingham has championed its charter of rights and the Government have laid down a statement of expectations. Will you make providing exempt accommodation conditional on agreeing those types of standards?
Eddie Hughes: Again it is something that we need to consider. I just shout out to Sharon Thompson on the work that she has done. I am a bit of a fan of her work and her passion for it. Birmingham is leading the way with the work that it is doing. It gives us the opportunity, through Birmingham, to be able to understand how effective different interventions are, how prescriptive we need to be and what is the most effective way. Anything else to add, Cathy?
Cathy Page: We are definitely exploring what kind of minimum standards might be appropriate and how those standards should be applied. On top of the accreditation, we definitely need to have a look at mandatory support standards, how those support standards are enforced, if we are going to enforce them, and what its relationship is with housing benefit in terms of payment of housing benefit related to standards that need to be met. That is the package of measures that we are engaging in a wide-ranging consultation with the sector and with local government on. Minister Rutley has referred to the work that has already been done in conversations on care, support and supervision.
The three things that were announced on 17 March—mandatory support standards, looking at the change in care support and supervision, those three things together are what we need to be looking at to try to put the picture of wraparound support in supported exempt accommodation.
Q214 Chair: Coming back to the comments about the look you are having, Cathy Page, at the regulatory regimes that are available and the gaps that exist, is one of the objectives at the end that councils, members of this Committee and tenants might be able to understand the regulatory framework when you have finished that work?
Cathy Page: I would hope so, because what we would need to do is articulate whether or not there was a gap. There is no point doing the mapping so that we could see who is responsible for which bits. We have already established that supported exempt accommodation is incredibly complicated in its makeup. There is not one market, there are several markets and there are several different types of accommodation.
By looking at the way in which each of the bits of the market are regulated and by whom and identifying that gap, we should be able to articulate whether or not there is a gap to be filled, how it should be filled and by whom. It is whether or not we are talking about the possibility—which we are discussing with the consultees who we are talking to at the moment—of a national oversight body of any description to help local authorities determine what should be happening in their local area and to help them understand better how they can approach, from a national perspective, changing things.
Eddie Hughes: Can I just give a briefer answer and say that that that is an admirable ambition, one that I would fully endorse and it should be our objective?
Chair: So that Ministers can understand it as well, presumably. Moving on, when we went Birmingham we had a very good session with residents who live in areas where a lot of properties have been converted to exempt accommodation. Following up on those issues, Sara Britcliffe.
Q215 Sara Britcliffe: Thank you. Can I put on record that I am also the treasurer of the Temporary Accommodation APPG, as I was not here at the start?
Minister, several submissions called for reform to the planning laws surrounding exempt accommodation, including scrapping the exemption from HMO regulations and requiring planning permission when converting a property to exempt accommodation. Will the Government be adopting these changes in their reforms to the planning system?
Eddie Hughes: I would start by saying that I personally do not think that planning reform is the tool that is going to drive up standards. That is not the way that we need to address it. Let’s say for the sake of argument that all of the accommodation that existed currently in supported exempt accommodation was good quality with good providers running it. Then I do not think that you would see, for example, the number of anti-social behaviour issues associated with the accommodation. It would be operating better, people would be less likely to notice it in their area or in their street and we would be in a different place. Therefore, I do not think that the problem should be looked at necessarily from the lens of planning.
However, having said that, I completely understand also why Birmingham, which you have visited, has implemented an article 4 direction to remove those permitted development rights. I mentioned the fact that we visited Blackpool Council. Blackpool is implementing it, I have to say, on my birthday—but not because it is my birthday. On 3 October Blackpool is going to be implementing an article 4 direction. Some councils certainly see this type of tool, with the restriction on permitted development, as one that they think might be effective and so they are going to be deploying that.
With regard to unintended consequences, it feels that the Government are sometimes being prodded in both directions simultaneously. We—perhaps not all members of this Committee—would like to see an increased number of houses and homes available. Sometimes you can achieve that through things like conversion from commercial to residential. We also know that sometimes things get stuck in our various council planning departments. If we could unburden them slightly to allow them to process things easily or have permitted development that allows people to create more homes, that is no bad thing in and of itself. However, I also understand your point that some people are going to be concerned about whether planning has some role to play. Personally, I do not think that we should be approaching the quality of housing through the planning direction, but I understand why others might.
Q216 Sara Britcliffe: To follow on from that answer, do you think that permitted development rights have accelerated exempt accommodation areas?
Eddie Hughes: That may possibly be the case in some areas, I could not dispute that. However, perhaps we are linking cause and effect where they are not necessarily linked. What has driven it up might be, for example, where a council has not taken as robust an approach to this type of accommodation being developed and that has left the door open a little bit and has allowed people to come in.
I have mentioned the difference between proliferation in Birmingham versus Manchester where over that four-year period there was a big increase in Birmingham and a smaller increase in Manchester. Planning rules still apply the same in both of those councils, so what is it that is different? That is what we should be looking at. Those planning permitted development rights apply universally, so why has Bristol not experienced the doubling over the period of five years that Birmingham experienced, when they were both open to the same permitted development rights? Having said that, we should be looking particularly at all of the existing tools that we have in the box and finding what is the best way to deploy them. Where we see good practice from one council, we should be encouraging other councils to consider it.
Q217 Sara Britcliffe: Thank you. I was not on the Birmingham trip, as I have only just joined the Committee, but I do know that the Committee met with community groups and neighbourhood groups in Birmingham who proposed introducing a cap on the amount of exempt accommodation in a given area. Would you support this proposal?
Eddie Hughes: I say again that I think that we are linking two different things. If the quality of that accommodation was good and the appropriate level of support was being implemented, if they were doing an assessment of the support that was required before they placed people in that accommodation, we would not be ending up in a place where people were unhappy.
In an ideal circumstance—I am always mindful of Ian Byrne mentioning my over-optimism—if everybody was operating at the standard of the best providers, people generally would not be so concerned about the proliferation of this. It is because there is a number of rogue operators that are not providing support that we end up with antisocial behaviour or ambulances being called or people placed in accommodation that is completely inappropriate to their needs. Therefore, I do not think so because I think that we are best approaching it from a quality point of view.
Q218 Sara Britcliffe: Thank you. Will exempt accommodation residents, who tend to have licence contracts rather than tenancies, be afforded greater protection through the Social Housing (Regulation) Bill?
Eddie Hughes: In some cases where they are covered, where they are social housing, but my experience of where we have the greater concern is in non-social, non-commissioned accommodation. That would not be covered. Most of the problem areas are not in the areas that would be covered by the Regulator for Social Housing.
We need to do a multiplicity of things. As a Government, our objective is to drive up the standards of accommodation regardless of the tenure that you live in. If you are privately renting, if you are social renting, if you are in exempt supported accommodation, we need to drive up the standards in all of those because everybody deserves somewhere safe and decent to live.
Q219 Sara Britcliffe: Will exempt accommodation providers and the landlords they lease from be included on your register of landlords?
Eddie Hughes: Where they are private landlords that fall within the purview of it. Having said that, we have not completely yet defined the extent of that portal. I would like to think that it is something that we should be considering in the design of it, because even if it is not an immediate use of that portal it feels to me like it might be an appropriate use in the future.
I have to say that it is a daunting thing to appear in front of your Committee, I will not deny that. However, I feel that the input from it is invaluable in terms of informing while we are at this formative stage of the policy. With regards to the private rented sector, we have published the White Paper but, as we all know, there is that gap between the White Paper and the introduction of legislation that allows us to look more creatively at how we might implement the legislation.
Chair: We hope we are here to help, Minister.
Eddie Hughes: It is scary and helpful in equal measures.
Chair: I have to say that you never appear too daunted when you come to see us. Let’s move on. The role of local authorities is key in all this. Ben Everitt.
Q220 Ben Everitt: I will take scary and helpful. That is all right.
We are probably going to cover a lot of the ground that we have covered already so I hope that this is a relatively quick section for you, not least because right at the start of this evidence session you mentioned that councils are best placed to deliver the services and to set the regulations and standards. However, we have heard that there should be a national set of regulations and standards.
Obviously, councils have said that they should get greater powers and greater funding to monitor and enforce the regulations. The Government released a new policy about this on Saturday. I do not want this to be one of those 1970s TV interviews with, “So, Minister, tell us how good your policy is”, but do you think that we have got the balance right between local and national Government within a framework of regulations and standards?
Eddie Hughes: It would be unministerial of me to say that we do not know, which is why that it is so important that we are drawing together two things. The data harvesting exercise that I am commissioning plus the work that we are going to get through the extension of the pilots allows us to figure out what it is that we do and do not know and what solutions and interventions worked most effectively.
I will come back to the point that during the initial pilots—£5.5 million across five councils—with no change in legislation, no extra duties or responsibilities to councils, just, “How can you use the existing tools in your box more effectively to deliver better outcomes?” They demonstrated that. Savings that some of them profess to have made through being able to deter some people from entering the market or some providers from providing accommodation was more than the amount of money that we invested in it. There was no change in tools, a small change in terms of in us providing the funding and acceptance on behalf of some or all over the councils that they could find some more money themselves from their own existing funding to be able to do that.
I genuinely think that we need to balance two things. Me as a Brummie understanding what is going on in Birmingham and being determined to move things as quickly as possible because as the Minister I feel a personally invested approach to this, but, by the same token, not wanting to fall over ourselves and implement something that has unfortunate consequences elsewhere. This is why we give the money to councils. They know best what works and will be able to give us the best feedback in terms of what they think would be appropriate. However, I would say that I would rather reach for the extra legislation as a final report rather than our first resort, because sometimes we do too much legislating.
Q221 Ben Everitt: I think that we can agree on that. The point about the pilots is that there are just five of them and they are all unitaries. What lessons have you got from the pilots that can relate to two-tier authorities and what challenges do you anticipate that they will have in solving the issues that we are trying to tackle.
Eddie Hughes: I might ask Cathy to come in. That is a very good point in terms of the people that we have funded so far. The funding that is available now will be available to any council to make a case and to bid for. I would like to think that regardless of what tier authority they are, they will have been able to learn from the feedback that we have heard from the existing pilots. Cathy might have something to add.
Cathy Page: It is just that. We will be tracking the SHiP programme now that it has been announced. Any local authority can apply, upper or lower tier. Two-tier authorities can join together and put a bid in, for example. If local areas want to work together, we would very much welcome that. The other thing is that as part of what was announced on Saturday there was also a good-practice guide from the pilots. That good-practice guide should be used by any local authority that feels that they have an issue and would like advice and guidance on how they might address it. The combination of those two things will enable us to help service two-tier authorities with knowledge and resource.
Q222 Ben Everitt: DLUHC must be the most optimistic part of Government, because the assumption there is that two-tier authorities would want to work together and work well together. There are two steps in that chain that might fall apart. The additional part of this is that the authorities that apply to be part of the pilot are naturally the forward-thinking authorities so they are going to be the ones that are more successful in delivering the pilot objectives.
We all know that some authorities are better than others at delivering these things. When it comes to dealing with the problematic aspects of exempt accommodation, quite a few councils repeatedly would consider it to be an HMO problem. What are we going to do about making sure that with the powers and the funding there is the scope and the culture to address the problem?
Eddie Hughes: One of the things that I appreciate, having been in the Department now for 18 months, is just how plugged in we are to local authorities. For example, in the work that I do on rough sleeping we always have regular communication and we second some staff from other councils and so on. That link between the Department and various authorities is a solid one.
While we might not know in great detail the extent of the challenges in every local authority, we would have a broad understanding of the most contentious or problematic ones. Those conversations are going to need to be being had with regard to if we have not had an expression from a council that we think needs to express some interest then it will be to us to try to prod them in the right direction, accepting the fact that there is a limit to how far we can go. This lead a horse to water thing. We can encourage them, but we cannot force them.
Ben Everitt: In the “Walk softly, but carry a big stick” territory.
Eddie Hughes: A stick, at least. It is such a valid point because frequently the people who step forward to engage in additional training and research and so on are the people who might have a problem but are engaged in providing a solution. Our job is to help those people who do have a problem but are not necessarily engaged in finding a solution.
Q223 Chair: Thank you very much for coming this afternoon. While we have you, Minister, the Rental Reform White Paper has been introduced. You have a consultation period, which we are going to contribute to as a Select Committee. We have not formally announced it yet but that is the Committee’s intention. Could you give any idea of the timescale for the completion of that consultation and when the Bill is likely to be introduced? We would not want to produce a report for you that came after you had already made your final decisions.
Eddie Hughes: One of the things that I have realised through my time in the Whip’s Office and as a Minister is that while you might have a perfectly crafted Bill, getting it into the sausage machine through the Parliamentary Business Committee is determined elsewhere. Other people will decide what the legislative priorities for Government are. However, Chair, I would urge you to act and engage as quickly as possible because I am keen to see the legislation introduced as quickly as possible.
Chair: I know you always try to be helpful, Minister, although I am not sure quite how helpful that was. Thank you both for coming this afternoon and giving us a lot of information and a lot of answers.
We all agree that this is a very challenging area that does need resolution in a number of respects. That is what the Committee now will be going away to think about and produce a report. What we have established is that we all want to see some improvements in this area. It is the nature of those improvements and how we get them right that is the challenge ahead now. Thank you very much.