Written evidence submitted by Spring Housing Association [EXA 047]

Executive Summary

Spring Housing Association is a registered charity based in the West Midlands. Spring was set up in 2014 to provide accommodation and support services to individuals who are at risk of homelessness. Our aim is to provide high quality housing options, deliver holistic housing services and maximise tenancy sustainment, and to offer individuals a pathway into employment, training, and advice. We currently operate across the West Midlands and provide exempt accommodation in Birmingham, Coventry, and Stratford.

Our research on exempt accommodation has been quoted and referenced extensively in several publications, such as the Kerslake Commission on Homelessness and Rough Sleeping and The House of Commons Library Research Briefing on Supported (Exempt) Accommodation. Our Charter of Rights appears as good practice in the National Statement of Expectations for supported housing, and the recommendations from our research reports have formed the basis of Birmingham City Council’s work on this issue, including their recent MHCLG/DHLUC funded pilot.

This submission is based, primarily, on over 7 years operation as an ethical and well-respected provider of exempt accommodation and 5 years in-depth research. This research has focused largely on what we deem as the most problematic element of a wide and varied ‘sector’, with much excellent provision. This is non-commissioned exempt accommodation in shared residential units, often under the management of lease-based Registered Providers.

The ‘exempt’ provisions of Housing Benefit have in place since 1996. They have long been acknowledged as a complex and difficult to administer area of Housing Benefit; open to error and subjective interpretation and hampered by loose definitional criteria, with the risk of providers claiming excessive rents whilst providing inadequate accommodation and little to no support high.

The government has periodically looked at movement towards reform of this system since 2011[1]; largely due to the complexity of the regulations and rising costs. Since 2017, when Spring Housing began their pioneering research with the University of Birmingham and continued this work with Commonweal Housing, awareness and understanding of the potential problems with the current system has grown. What was in some sense relegated to a ‘Birmingham’ issue, has since gained traction as an issue of national import[2], and we contend that it is necessary to revisit proposals for reform.

Our research evidence suggests that the regulations surrounding exempt accommodation are no longer fit for purpose; open to exploitation by providers, often at high cost yet unable to provide the quality and levels of support required, or adequate reassurances around resident safeguarding and wellbeing.

There is a lack of rigorous national data on exempt accommodation, including data accurate national comparators but, overall, and in several local areas, exempt claims – and thus costs to the public purse - are increasing exponentially without adequate assurances of value for money, quality of buildings and support, and the safety and wellbeing of residents.

Key Recommendations:

      For local authorities to have greater tools, authority, and ability to control provision and growth, based on their strategic needs assessment.

      A government-backed national accreditation requirement for providers of short-term supported housing, with additional regulation to enforce this.

      Greater clarity and stronger definitions in Housing Benefit regulations relating to the level and provision of ‘care, support and supervision’.

      A reappraisal of the justification in Housing Benefit Regulations for the different subsidy rules for Registered and non-registered providers

      Remove the exemption for Registered Providers from the definition of an HMO in the Housing Act 2004, to enable licensing and planning powers such as Article 4.

      Strengthen the role of the Regulator for Social Housing so that they can monitor compliance against specific consumer standards for RPs in this sector.

      There must be greater accountability and consistency in out of area placements into exempt accommodation. There must be a shared Protocol for statutory referring agencies into Exempt Accommodation.

      The Charter of Rights for residents, commissioned by Birmingham City Council, should be rolled out nationally, and further effort should be put into a similar venture for local communities in which there are high concentration of exempt accommodaiton.

Full Evidence Submission:

Spring welcomes this inquiry into exempt accommodation for several reasons:

      Part of our portfolio is classed as ‘exempt accommodation’; and one of our foundational principles was to ensure we were bringing safe, quality provision into a market we viewed as increasingly problematic, and often perpetuating and entrenching the homelessness it was ostensibly set up to relieve. Our work in this area is considered best practice across the West Midlands and we are commissioned in 18 local authority areas.

      Since 2017 we have been working with a range of partners to conduct research and best practice work around exempt accommodation. We have produced two pathbreaking research reports on the sector, which have had significant, and ongoing, impact at local and national levels. Our work was the first to comprehensively define, research and analyse the sector, and is still regularly utilised, by a range of local and national agencies when attempting to understand, and work towards policy solutions within, the sector.

      We have co-produced, with over 50 individuals with lived experience, a Charter of Rights for residents of exempt accommodation[3].

      As a result of our influential research and best practice work, we have engaged with, and are often consulted by, a wide range of statutory and voluntary groups, including government departments, MPs, councillors, local authorities, domestic abuse charities and homelessness charities.

This submission incorporates:

      5 years of in-depth primary research and analysis on exempt accommodation

      Over 7 years of operation as an ethical and well-respected provider of exempt accommodation (both commissioned and non-commissioned)

      Intelligence from participation in a range of national and local groups and boards

      Continued engagement with a wide cross section of exempt accommodation providers in Birmingham to ‘roll out’ adoption of the Charter of Rights

      Membership of the Exempt Accommodation Sponsor Board, part of Birmingham City Council’s MHCLG/DHLUC funded Supported Housing Oversight Pilot (SHOP).

Defining the terms of our submission:

As the ‘exempt’ provisions of Housing Benefit have been in place since 1996 and are an established mechanism of funding, primarily, the housing-related costs of a wide range of supported housing schemes; many of which provide reputable and often life-changing services, it is important that we clearly define our terms. Our submission, in the main, refers to shared residential units that are not commissioned under local authority homelessness or social care funding, or under specialised supported housing (SSH) arrangements, and which utilise the ‘exempt’ provisions of current Housing Benefit and Universal Credit Regulations. This provision operates, at least ostensibly, on a short-term or transitional basis, accommodating a wide cross-section of often multiply excluded and disadvantaged groups, and is often under the governance of ‘lease-based’ Registered Providers of Social Housing[4]. This type of supported accommodation is not ‘new build’ supply but utilises, and in many cases converts, existing buildings and homes into multiply occupied schemes.

Whilst it is our overall contention in the remainder of this submission that the regulations surrounding exempt accommodation are no longer fit for purpose; open to exploitation by providers and often unable to provide the quality and levels of support required, or adequate reassurances around resident safeguarding and wellbeing, the above definition, we believe, most clearly – and most severely – exhibits the myriad of weaknesses and gaps in the oversight, monitoring and regulation of this ‘sub-sector’. Our research publications coined the phrase ‘accountability deficit’ to refer to the cumulative weight of these gaps in scrutiny, oversight, regulation, and monitoring.

Key findings from our work:

Housing Benefit and Funding for Support

      The lack of stringent regulation and monitoring around the assessment and dissemination of rental claims at ‘exempt’ rates, with ‘care, support, or supervision’ (CSS), needing only to be ‘more than minimal’ to achieve rental yields sometimes five times above Local Housing Allowance Rates in the private rented sector.

      The ambiguous nature of the Housing Benefit Regulations means that ‘more than minimal’ care, support of supervision can be interpreted differently by local authorities, accommodation providers, and legal professionals at Tribunal. This can mean it is difficult for local authorities to challenge the absence of CSS, risking poor quality, insufficient services being funded through an expensive benefit system.

      There are no mechanisms through the existing benefit system to monitor or measure the outcomes of non-commissioned exempt provision. Our research has suggested some individuals are ‘trapped’ in high-cost exempt accommodation for years, and feel it has actually been detrimental to their wellbeing and growth.

      The payment of Housing Benefit at ‘exempt rates’ is not subject to an assessment of building standards, safeguarding proficiency, background and capacity of landlords and organisations, or the suitability of the type and levels of support for claimants. If a provider meets (or suggests they meet) the ‘more than minimal’ CSS and are one of the organisational types eligible under Regulations, then local authorities are legally obliged to make payment, regardless of any such extraneous factors.

      Similarly, local authorities have no legal powers to limit the growth of non-commissioned exempt accommodation in their area (and thus refuse new claims / schemes), based on a strategic assessment of need. This can lead to an oversupply; to providers seeking out wider and more varied referral routes, and taking on ‘riskier’ clients in order to fill rooms. The financial imperative to ‘fill void bedspaces’ in accommodation that has not been rigorously assessed for area-based suitability and need can take precedence over proper risk assessments around client groups. This can also lead to other local areas ‘exporting’ their more problematic, or ‘difficult to house’ clients into areas with a perceived abundance of available spaces[5]

      Flat rate, high-cost provision with little viable alternative ‘move on’ accommodation can leave residents disincentivised from gaining employment, as this will ‘take them out’ of the benefit system and leave them unable to pay the very high rental costs themselves.

      ‘Exempt’ Housing Benefit does not fund the ‘more than minimal’ CSS[6]. However, there has been a significant depletion of support funding for single homeless people since the removal of the Supporting People ringfence in 2009[7]. This has led to a somewhat confused picture around how support costs are funded by non-commissioned schemes. Our research has found a combination of sources, such as (often short-term) grant funding from charitable bodies; providers claiming to use previous years’ ‘surplus’, or charging each resident a non-housing benefit eligible service charge to fund their own support costs. It is likely that the reduction of support funding through central government has led some providers to, potentially, ‘misuse’ the system, or recoup some lost or absent funding through exempt Housing Benefit.

      There is a further inequity at the root of the exempt Housing Benefit Regulations: what are known as the ‘subsidy rules’. In short, ‘exempt’ claims under Registered Providers of Social Housing (RPs) allow the local authority, in most cases, to claim back 100% of the benefit they pay out; whereas with other charities or non-profit organisations, the local authority will have to pay between 40% - 60% of the rental costs themselves, if they are unable to restrict the rent level to that set out by a Rent Officer Determination. This can mean there is a disincentive to scrutinise RP claims in as much detail. This can also ‘penalise’ organisations that are not an RP, or ‘under’ an RP, and leave them unable to claim the rental costs they feel their scheme requires. This can also act as an incentive for smaller organisations to work with an RP (become a ‘managing agent’) as rental levels will, generally, be much higher. As our research and recent activity by the Regulator of Social Housing have shown, many lease-based Registered Providers managing exempt accommodation have not displayed the probity, acumen and high standards that would justify this disparity in the way claims are assessed. In effect, the subsidy rule can amount to disinvestment in valid, well-run and beneficial supported housing schemes that are not run or managed by RPs.

Other Regulation and Oversight:

      A significant number of lease-based Registered Providers of exempt accommodation have been deemed non-compliant by the Regulator. However, and whilst welcomed, this intervention has been around Governance and Financial Viability, and is unable to account for the risks to wellbeing and safety experienced by the many residents we have spoken to throughout our years of research, or the suitability and value for money of the accommodation and associated services.

      Registered Providers of Social Housing are, under Schedule 14 of the Housing Act 2004, exempt from the definition of a House in Multiple Occupation (HMO). This also means that they are exempt from statutory licensing conditions, which includes any additional or selective licensing a local authority may apply to the Secretary of State to implement. Such accommodation under Registered Providers is also exempt from the Management of Houses of Multiple Occupation (England) Regulations 2006, which governs the way such premises are managed. This can make it very difficult for a local authority to enforce housing standards, and can also mean that landlords, directors and providers who would possibly not pass a ‘fit and proper person test’ under licensing conditions, are free to run and manage accommodation for very vulnerable and marginalised groups, using large sums of public money.

      Our research has evidenced the wide range of untracked and unmonitored referral routes into non-commissioned exempt accommodation[8] This can include people newly released from prison, ‘sent’ from local authorities hundreds of miles away, Care leavers’ teams, ‘move on’ from domestic abuse refuges and various institutional settings. Such referrals are often made by organisations who have no real knowledge of the accommodation, its suitability or legitimacy, who else is living there in the property and any potential risks they may pose to resident safety and wellbeing. Local authorities currently have no control over referral routes into non-commissioned exempt accommodation and are often unaware when high-risk individuals or individuals with complex support needs are moved into their area.

      There is no independently verified national accreditation for providers of supported housing. This means there is no surety for local authorities that the provision they do not commission is proficient at providing good quality care, support, or supervision, is able to effectively monitor safeguarding, and is fully aware if its responsibilities towards building safety and standards.

Safety, wellbeing, and ‘risk’

      The varying assessment methods used by referring agencies and accommodation providers prior to placement, and varying levels of attention to safety and resident wellbeing can mean residents are placed into, often lightly monitored, shared houses with other residents who pose a risk to them.

      The weak regulation and monitoring of the sector increase the potential for inexperienced, ill-equipped, or unscrupulous practice which can, at worst, leave residents open to exploitation and abuse, or living in accommodation that is detrimental to their wellbeing.

      The lack of choice and control residents had over their accommodation placements and the often-poor conditions or unsuitable environments led to common experiences of isolation, insecurity, and lack of privacy, with associated negative effects on mental health and wellbeing.

      Placements into unsuitable non-commissioned accommodation led to repeated instances of homelessness. Poor, chaotic and badly managed exempt provision was repeatedly cited by individuals rough sleeping as a reason they did not want to ‘come inside’.

      There are serious concerns for women placed into mixed sex, shared accommodation which lacks assurances around providers’ attention to safety and protection. Relatedly, we have seen an increase in non-commissioned exempt providers purporting to be ‘refuges’ for women fleeing domestic abuse, without adherence to any relevant quality standards, or evidence of any previous proficiency and capability in this area. This has led to some women feeling unsafe and retraumatised in accommodation that is being paid for by public money under the guise of providing safety and protection for survivors of abuse.

      The lack of funding for commissioned accommodation and the absence of viable alternatives can leave a high proportion of multiply excluded, disadvantaged or at-risk individuals feeling ‘forced’ into a sub-sector with little perceived choice, control or awareness of rights and options

      Poorly managed and run non-commissioned exempt accommodation can lead to an increase in antisocial behaviour in local areas, which can leave non-exempt residents and community members feeling distressed and concerned. Similarly, due to the lack of coherence between planning regulations and exempt Housing Benefit regulations, some local areas will have high concentrations of non-commissioned exempt accommodation which is not adequately run. This can again cause community tensions and have negative effects on community cohesion and wellbeing.

Focused answers to inquiry terms of reference:

What is the quality of exempt accommodation?

The quality of exempt accommodation varies considerably. There are reputable organisations and landlords who use the rent funding as intended: to invest in their stock and housing management services. These landlords will often have developed the accommodation in consultation with their Local Authority and will generally tend to meet ‘lower-level’ support needs.

However, there are several providers - registered and non-registered - who do not use exempt rental costs (and eligible service charges) for their intended purpose: to account for the housing-related costs of providing a level of care, support, or supervision, and instead view this as a means of generating income. As a result, the quality of many of these properties is well below any known standards. Although the Regulator is taking welcomed action against lease-based exempt providers, there is still a disconnect between quality of provision and payment of exempt rental costs. There is currently no regulation attached to the assessment and dissemination of Housing Benefit money that considers factors of ‘quality’. We would add here that when considering issues of ‘quality’, there is a tendency to focus on ‘bricks and mortar’ quality, to the detriment of considerations of the quality of support, and the quality of life, experienced by residents; including issues of safeguarding proficiency and organisational ability to provide good quality support.

As our earlier evidence shows, the current licensing regulations under the Housing Act 2004 do not cover Registered Providers and we suggest a licensing scheme for non-purpose built / converted supported housing – such as those in operation for Houses in Multiple Occupation – would help to address some of the disconnects between quality of provision and payment of exempt rents.

Similarly, it is also appropriate to consider a ‘fit and proper person’ test for directors of private limited companies that are operating non-commissioned supported housing.

There is also a more nuanced question as to whether companies / entities that are new to an area should be able to start claiming public money, on behalf of often very vulnerable groups, without first registering with a local authority and following a process of scrutiny and accreditation.

Is the current model of exempt accommodation financially viable, and does it represent value for money?

Where support is commissioned separately (by a local authority), and where the quality of accommodation meets high standards and is well managed, it does represent value for money. Exempt accommodation can improve, and often save, lives, and the existing regulations were devised to account for the higher costs of providing and managing this type of accommodation. This includes greater wear and tear, upkeep of communal areas, increased repairs, additional housing management services and a higher turnover of residents.

The current model is only financially viable if the support is funded separately, and there is sufficient oversight and regulation to ensure that the rents and property charges are used as intended: to provide good quality, safe, and well-run accommodation. It is not financially viable for providers to rely on non-eligible service charge payments from residents to fund support costs; and it is difficult to justify charging often vulnerable residents for their own support, without means testing or assurances of what services this is paying for, and what avenues of recourse and redress residents have if they believe this is not being provided.

We are seeing significant growth of non-commissioned exempt accommodation where the higher rents are not being used to maintain high quality accommodation, leaving some of the most vulnerable residents accommodated in some of the poorest housing, without adequate support and often in a ‘benefit trap’ that leaves them unable to take up employment. Prospect Housing has recently estimated that at least £816m was spent on exempt in the last year alone.

Many providers have also discovered that it is not financially viable to open schemes in a local area without consultation with the local authority around need and supply. This has led to cases of oversupply, and providers looking to fill void bedspaces by seeking out increasingly disparate and potentially ‘risky’ referrals and mixes of clients from wide geographical areas.

Whilst we maintain that strengthened regulation and additional oversight for short-term, non-commissioned supported housing is imperative, we have welcomed the Supported Housing Oversight Pilots (SHOP) and the National Statement of Expectations for Supported Housing (NSE). In particular, the SHOP pilots are both a way to share insights and learning between local areas and are suggestive of some of the relative ‘gains’ that can be yielded from vastly increased local authority resources. The evaluation from the pilot seems to suggest that the increased funding in the recipient areas has enabled greater scrutiny of some Housing Benefit claims; more considered assessment of ‘care, support and supervision’, increased capacity to carry out property inspections and enforcement, and to train accommodation providers. Nonetheless, this still appears to be, in many senses, papering over the cracks of a complex, outdated and expensive system. Capacity and funding deficits for the oversight and scrutiny of exempt benefit claims exist in tandem with the accountability deficit but it is our contention that the former cannot adequately resolve the latter.

It could be argued that some local areas will, eventually, and with continued grant funding from DHLUC, achieve some form of ‘value for money’ within non-commissioned, short-term exempt accommodation by ‘driving down costs’, ‘driving up standards’, and limiting the spread of expensive and illegitimate provision. However, this level of scrutiny and rigour needs to be integrated into the system, rather than subsidised by short-term pots of grant funding, and matched by sufficient regulation and oversight. This is particularly the case when we consider exempt accommodation within its broader policy contexts. We would recommend consulting our research report, Exempt from Responsibility?, which clearly sets out some of the perceived external drivers for the growth and continued ‘need’ for non-commissioned, short-term exempt accommodation; and how it has found a level of indispensability due to the absence of truly affordable social housing, limited access to the Private Rented Sector, and vastly reduced central government funding for housing-related support for single homeless people[9]. As the current ‘need’ for exempt accommodation appears in many senses to be, instead, a need for accessible accommodation for benefit recipients, then it is highly likely the ‘problem’ will shift to other areas if local authorities with a high number of units are able to gain greater control.

Are there significant geographical and regional differences in the provision and the problems of exempt accommodation?

There is a lack of rigorous national data on exempt accommodation, including data accurate national comparators. An FOI published by Crisis in October 2021 shows that 153,701 households in Great Britain were housed in exempt accommodation as of May 2021; a 62% increase since 2016[10]. However, such data returns to the DWP are not able to differentiate between forms of exempt provision. Unless the framework for the specific sub-set of exempt accommodation we feel is causing the most problems is sufficiently described, and returns to the DWP are able to more accurately capture data, including greater specificity, it is not always possible to truly understand the scale, scope and growth nationally and across local areas. This has been our experience through our 7 years working on exempt – that it is sometimes only when the issues are described in a detailed way that stakeholders recognise this as something occurring in their localities – with many, for example, erroneously believing this to be a ‘private sector HMO issue’.

Birmingham has seen an exponential growth in this type of accommodation, with over 22,000 substantiated claims, and the rise in this type of provision is causing considerable concern in the West Midlands. Nonetheless, evidence suggests the model is becoming increasingly common in other areas of the country, as investors and providers see a business opportunity, and unmet ‘need’. Investors and potential providers contact Spring regularly, believing that there are opportunities for them, and the yield they expect is unrealistic.

Similarly, an FOI by Prospect Housing in 2021 suggests many other local authorities beyond Birmingham are seeing a steady increase in claims[11], and we would caution against seeing this as solely a ‘Birmingham issue’ – something we hope will be borne out by evidence submitted to this Inquiry.

What is the proportion of exempt accommodation that is provided by registered compared to non-registered providers, and is an appropriate balance being struck?

There is scant available national and comparative data on this and, particularly, no national data that differentiates between stock owning / more ‘traditional’ RPs and lease-based providers. In Birmingham, around 93% of provision is ‘under’ Registered Providers. However, it is unclear what any assessment of an ‘appropriate balance’ would be predicated upon. In terms of lease-based providers of exempt accommodation, the Registered Provider status has, historically, often appeared as little more than a vehicle through which managing agents can claim enhanced levels of Housing Benefit, due to the subsidy rules outlined on pages 4-5 of this document. In terms of an ‘appropriate balance’, some local authorities may have a stronger preference for RP exempt provision, as they do not have to pay any subsidy on those claims themselves. On non-RP claims, of course, local authorities can be paying millions of pounds from their own budgets. However, we have expressed how this inequity is unjustified in the current regulatory environment, and the recent performance of many lease-based providers.

Although, in theory, Registered Providers are subject to greater housing-specific regulation and oversight than stand-alone charities or Community Interest Companies; in practice this does not provide the automatic assurances required to deem one form of provision as innately preferable to another. RPs have, often at best, an ‘arms-length’ relationship with their managing agents and some managing agents are for-profit entities; with high numbers of units designated as ‘non-social’ housing; meaning that regulation and oversight is incredibly limited. For example, such provision is not subject to Consumer Standards or the Rent Standard.

Registered status does not, as recent regulatory involvement has shown, currently provide any assurances around quality of provision, and the existing oversight of Social Housing is not able to effectively regulate the myriad of issues we are seeing within this model; including resident safety and wellbeing, quality of support and resident autonomy and control. In particular, the current Consumer Standards, where they apply, are reactive and rely on a very high trigger of ‘serious detriment’. Although the government’s proposals in the Social Housing White Paper are set to reform the way these standards are regulated overall, it is important they are able to capture the specific issues within supported exempt accommodation managed by lease-based RPs, which are very different from general needs accommodation provided by stock-owning organisations.

The question of an ‘appropriate balance’ appears to rest upon a premise that is not clear. It may, as we have set out above, depend on stakeholder priorities, perception, and, fundamentally, what is required in an area. As local authorities currently have no powers to control non-commissioned exempt accommodaiton based on strategic needs assessments, it is difficult to achieve an ‘appropriate balance’ in any real sense.

What is the proportion of exempt accommodation provided by commissioned compared to non-commissioned providers, and is an appropriate balance being struck?

Again, there is no nationally available data for comparison on this issue. In Birmingham, the best available estimate is that around 94% of provision is non-commissioned. In terms of the amount of provision required in Birmingham, early indications suggest only around half of the 22,000 units currently in payment are ‘needed’ and would form part of a commissioning strategy, were such levels of funding ever available[12]. As it stands, local authorities often do not get to make the decision of whether an ‘appropriate balance’ has been struck, because they don’t have adequate funding to commission as much as they need to, and cannot adequately control non-commissioned growth.

How does whether a provider is registered or non-registered, or commissioned or non-commissioned, impact the quality of provision?

Whilst oversimplification creates a forced binary between commissioned and non-commissioned as ‘good’ vs ‘bad’ quality; generally, the most problematic elements of the sector are found in non-commissioned accommodation. This is not to suggest all non-commissioned provision is of a poor quality – indeed there are many well-run, excellent quality providers of this type across the country. However, there is more likelihood that some non-commissioned provision will be of a lower quality due to the absence of sufficient regulation, stringency, and monitoring. Commissioning provides a much higher level of assurance around quality of provision and outcome generation, but it is important to note that, particularly in straightened funding circumstances, non-commissioned accommodation is needed, and can be much more responsive and flexible than commissioned models.

In terms of the type of Registered Provider we are most concerned with – lease-based providers exclusively utilising the exempt provisions of Housing Benefit – there are no assurances that RP ‘status’ equates to better quality provision. The regulatory judgements against several lease-based RPs exhibit the deep-seated problems within this model and there are no assurances that this type of accommodation will be of an acceptable standard. The social housing sector has seen its regulatory oversight progressively weakened over the last decade and the Regulator is currently unable to provide the levels of proactive stringency and monitoring that are required for this type of provision, and the often very vulnerable individuals it accommodates. There are no provisions in Housing Benefit Regulations to provide assurances around quality at the point of claim, or powers to liaise with the Regulator prior to paying out claims at exempt rents.

In addition, the Regulator’s powers are not able to account for resident wellbeing and safety, and the ‘quality of life’ issues that we argue are just as important as the quality of buildings. In this respect, there can often be little different between Registered and non-registered providers. We would suggest that this specific type of provision – and these specific resident groups – must be accounted for when proposals for the overhaul of consumer standards through the White Paper are fully drawn up and implemented.

Finally, provision not ‘under’ a Registered Provider may sometimes be of a lower quality simply because non-registered providers incur large subsidy losses to a local authority, and so there is far more incentive to scrutinise and drive down rental costs. This can leave such providers with much lower revenue, but they are often expected by stakeholders in the sector to provide a similar service. 

How should exempt accommodation be provided and what should the service cost?

The SHOPs have required local authorities to carry out a supported housing needs assessment and develop a supported housing strategy. We believe these documents should underpin the development and provision of exempt accommodation in a local authority area. In addition, the Housing Benefit regulations should be updated to provide better definitions around levels and provision of ‘care, support or supervision’.

As we have referenced several times throughout this submission, central government must address the significant gap in funding for support. This would enable a re-direction of the current spend on poor quality non-commissioned accommodation into the provision of good quality supported accommodation, commissioned to meet local need. Local authorities should have significantly more control than they currently do over provision in their area, but with exceptions around specialist services such as domestic abuse refuges, learning disability provision, and long stay supported living that forms part of the NHS care plan to close long-stay hospitals. Our proposals refer strictly to more ‘generic’, short-term homeless provision.

How should the regulatory oversight of exempt accommodation be organised?

The combination of structural and policy drivers, coupled with inadequate regulations can only be addressed effectively with Government intervention.  We propose that there should be consideration of a government-backed national accreditation requirement for providers of short-term supported housing, with additional regulation to enforce this. This could be done by taking some of the core rent from the DWP subsidy and giving this back to local authorities to effectively administer a regulatory regime for all types of supported housing. This would ensure that no new money is required, but a re-profiling of the current rental model would allow for a subsidy grant to local authorities.

Oversight of the provision and development of supported housing should be under the purview of Local Housing Authorities, based on a duty to assess the local need for supported housing and development of a supported housing strategy. This will allow for the range and amount of provision required to meet local need, but not restrict those who cannot remain in their local areas, such as those fleeing domestic abuse. This will allow local authorities to refuse new claims/schemes for ‘generic’ short-term exempt accommodation if they can evidence sufficient existing provision in the area.

What should be the regulations governing exempt accommodation and how should those regulations be enforced?

      For local authorities to have greater tools, authority, and ability to control provision and growth, based on their strategic needs assessment.

      A government-backed national accreditation requirement for providers of short-term supported housing, with additional regulation to enforce this.

      Greater clarity and stronger definitions in Housing Benefit regulations relating to the level and provision of ‘care, support and supervision’.

      A reappraisal of the justification in Housing Benefit Regulations for the different subsidy rules for Registered and non-registered providers

      Remove the exemption for Registered Providers from the definition of an HMO in the Housing Act 2004, to enable licensing and planning powers such as Article 4.

      Strengthen the role of the Regulator for Social Housing so that they can monitor compliance against specific consumer standards for RPs in this sector.

      There must be greater accountability and consistency in out of area placements into exempt accommodation. There must be a shared Protocol for statutory referring agencies into Exempt Accommodation.

      The Charter of Rights for residents, commissioned by Birmingham City Council, should be rolled out nationally, and further effort should be put into a similar venture for local communities in which there are high concentrations of exempt accommodation.

The Department for Education have recently published a response to their consultation around the provision of supported housing for 16 and 17 year old looked after children and care leavers. They will be proceeding with the introduction of mandatory national standards, and a lighter-touch Ofsted-led registration and inspection regime. This approach has merit when considering standards and quality for the wider exempt supported housing sector.

Is there sufficient publicly available information about exempt accommodation?

We would reiterate here that the term ‘exempt accommodation’ encompasses a wide range of supported housing types, and is possibly not useful as a term to appropriately identify the particular subset of supported housing that holds the most potential for exploitation, and is in most need of reform[13]. The exempt provisions of Housing Benefit are incredibly complex, as are the leasing and management arrangements of many registered providers of social housing who operate in this sector. 

Our vast experience of disseminating our research findings, giving seminars and talks and consulting with a range of stakeholders has shown that an understanding of the issues, complexities and nuances in an easily communicable form is lacking. The complexities of the system can leave communities without clear information if they encounter issues with exempt accommodation in their area, and can leave residents of exempt accommodation unaware of their rights and entitlements. Organisaitons referring into exempt accommodation can often be unsure of the type of provision, or the implications of certain organisational structures and arrangements; often mistakenly believing there is greater assurance around quality, legitimacy and redress than is the case.

In addition, distinctions between’ exempt accommodation’, ‘HMOS’, ‘Registered Providers’, ‘supported housing’, ‘care’ etc., can become elided in the public consciousness, which can both obscure or mask the scale and nature of the problems and leave residents, communities and stakeholders feeling without recourse or redress.

The Charter of Rights for residents of supported exempt accommodation that we co-produced with over 50 residents and former residents, which has been cited in the NSE, is something we would endorse nationally to assist residents in navigating the sector. A similar venture for communities living in dense areas of exempt provision may also be of benefit.

January 2022