Written evidence submitted by Derby City Council [EXA 082]

 

Derby City Council is increasingly growing concerned around the regulation of Supported Exempt Accommodation for several reasons, this includes:

 

  1. The lack of regulatory oversight relating to the support offering of SEA providers, in particular CIC providers.
  2. The lack of oversight relating to the appropriateness of the physical qualities of properties and the location of such properties.
  3. Referral processes are often fragmented with limited oversight.
  4. The significant and increasing impact on Council finances of non-regulated CIC providers.

Like many areas, Derby City Council is seeing a marked increase in the number of approaches by Community Interest Companies looking to establish a base in the City or extend the offering and an increase in SEA claims.  At present, there are 21 CIC landlords with 65 properties and 325 bedspaces operating in the City.  Whilst some CIC SEA providers do offer a good quality of accommodation and support, for other providers, we feel that this is significantly driven by the potential financial gains of providing such accommodation.  To quantify this, an average of £236 per week is eligible for Exempt Accommodation whilst the Local Housing Allowance for a shared room in a multi occupancy property is £62.83.

 

Currently, there is very limited oversight of both the quality of support and quality of accommodation offered to vulnerable people through SEA accommodation.  The National Statement of Expectation (Supported housing: national statement of expectations - GOV.UK (www.gov.uk)) provides a useful framework but without regulatory controls, this is little more than an aspiration as to the quality of support and accommodation offered.  We ask that Government consider giving Local Authorities the power and additional resource to regulate their local market and only pay those providers that meet a locally set standard. The lack of oversight regarding accommodation and support provided by CICs is, we believe, significantly putting vulnerable people at risk where they are all too frequently in poor quality accommodation with little or no support and not given the tools to effectively move into independent accommodation.  For the individual, this often has the effect of exacerbating their vulnerability and increasingly putting the individual at risk of needing support down the line from NHS or social care providers or increasingly at risk of substance misuse; mental health issues or committing crimes/ Anti Social Behaviour.  Additionally, many SEA providers establish Houses of Multiple occupation in already fragile areas of the City.  Clustering vulnerable people together in such areas can have a negative impact on both the individual and wider community.

 

There is little oversight of referral processes at a national level currently and a lack of capacity within most teams to have proper oversight of these referrals.  This means that many vulnerable people are referred into inappropriate accommodation with little or no support.

 

 

As stated, the financial incentives for landlords to operate SEA accommodation can be significant.  There are also financial impacts of CIC accommodation on Council finances.  Where the accommodation is provided by a Registered Provider (RP), the Council receives 100% of the benefit paid out back from the DWP. Where the accommodation is not provided by a RP, such as a charitable / voluntary organisation, the Council only receives 100% subsidy up to the Rent Officer determined market rent for the property which is much lower than the enhanced payments made for supported accommodation.  The financial impacts of this for Derby City Council are that non reclaimable Housing Benefit payments have increased from £376,000 in 2019/20 to a projected £1.2m in 2021/22.  We do not consider that this represents value for money at either a local or national level.

 

It is positive that Government established a number of SEA pilots (https://www.gov.uk/government/news/pilots-to-improve-supported-housing-for-vulnerable-people-extended) to look at ways to improve the standard and quality of supported accommodation.  We have been looking closely at the learning from these pilots and have been in contact with Hull City Council regarding their integrated team approach.

 

Whilst we believe this approach is showing really positive improvements and we would be keen to identify resource to replicate this approach, we believe that there needs to be a fundamental review of national regulation of SEA providers to ensure robust regulation.

 

 

January 2022