Payments for supported accommodation under universal credit

Issue 231 (December 2012)

David Simmons considers how payments for supported accommodation will be met after the introduction of universal credit, in the light of recent government announcements.

Background

Payments for people in various forms of supported accommodation can currently be met through housing benefit (HB) and the ‘Supporting People’ scheme.

  • People in local authority accommodation, or accommodation provided by a registered social landlord or a registered provider of social housing, are exempt from the local housing allowance (LHA) rules.
  • Those in what is termed as ‘exempt accommodation’ can only have their eligible rent restricted if their accommodation is unreasonably large or the rent is unreasonably high, and in most cases, if suitable alternative accommodation is available and it is reasonable to expect them to move (the ‘pre-January 1996 rules’).
  • ‘Exempt accommodation’ is accommodation provided by a housing association, registered charity, voluntary organisation or non-metropolitan county council where the claimant is provided with care, support or supervision by the landlord, or another person on behalf of the landlord.1
  • Temporary accommodation for homeless people funded by the Resettlement Agency is also ‘exempt accommodation’. There has been extensive caselaw on the scope of exempt accommodation.2

HB can cover eligible service charges relating to the provision of adequate accommodation. Other service charges to support people to maintain their accommodation can be met by the Supporting People scheme, a government fund administered by local teams within local authorities.

The government embarked on a public consultation on the future of payments for supported accommodation in July 2011, advocating bringing it within the system of the LHA, supplemented by additional payments, with provision in the longer term via locally administered funding.3

Universal credit

The draft regulations for universal credit (UC) make no specific provision for supported accommodation. Rent in the social rented sector (which includes local authority and registered social landlords) is subject to underoccupancy deductions and there is also a general power to restrict payments for excessive housing costs following referral to a rent officer. The draft regulations currently have extremely limited provision for service charges necessary to maintain the fabric of the accommodation, and for the cleaning of communal areas and exterior windows. It also appears that direct payments to providers will only be made in exceptional circumstances, at the discretion of a decision maker. UC will also be subject to the benefit cap, which will disproportionately affect claimants in more expensive supported accommodation, although it will not apply to disabled claimants in the ‘support group’, or to those receiving disability living allowance or the new personal independence payment.

Not surprisingly, many supported accommodation providers have been very concerned about the impact of UC on their residents and business plans, and have been lobbying the government for clarification and reassurance.

Latest developments – provision outside universal credit

The government has now announced that, ‘having listened to concerns of stakeholders’, housing costs for those living in supported accommodation will be provided outside UC, ‘... so that we can continue to provide a flexible system to help meet the higher costs often associated with providing such accommodation’.4 This will apply to claimants in ‘exempt accommodation’ as currently defined (see above). In the short term, this help will be delivered through local authority HB teams ‘under existing DWP legislation’. Claimants will still be eligible to claim UC, but their housing costs element will be provided separately. Those living in supported housing not classed as ‘exempt accommodation’ will receive their housing costs through UC. This will mainly apply to local authority tenants and housing association tenants not receiving care, support or supervision from their landlords. They will presumably be subject to the underoccupancy deductions and excessive rent provisions noted above.

In the longer term, the government is ‘...exploring the feasibility of a localised funding system’, using local knowledge to identify those to be included and to ‘...build effective relationships with providers to ensure resources are targeted effectively at those who need it’.5 This approach was mooted in the July 2011 consultation paper, via the payment of ‘standard HB’ supplemented by additional locally administered help assessed on an individual basis in a similar way to personal budgets for the support and care of disabled people.

The DWP has also announced that UC claimants placed in temporary accommodation following homelessness will receive their housing costs through UC, based on the appropriate LHA rate. The management element for temporary accommodation costs will be separated out and paid directly to local authorities (probably in the short term via top-ups to discretionary housing payment funding).6

More questions than answers?

The recent announcements have clarified that payments for housing costs for people in ‘exempt accommodation’ will, in the short term, be provided outside UC on a similar basis to current provision. This will give some reassurance to supported accommodation providers and residents, but a number of areas of uncertainty remain, including:

  • whether provision for those in ‘exempt accommodation’ will continue under current HB legislation (in particular, the ‘pre-January 1996 rules’);
  • the complexities of the scope of ‘exempt accommodation’ as illustrated by current caselaw (see above);
  • the application of the benefit cap and the availability of discretionary housing payments for those in more expensive supported accommodation;
  • the role and future of the ‘Supporting People’ scheme;
  • provision for service charges and the application of the ‘excessive’ rent rules for those not in exempt accommodation;
  • the amount of funding available for any future locally administered scheme.

 


Please be aware that welfare rights law and guidance change frequently. Therefore older Bulletin articles may be out of date. Use keywords or the search function to find more recent material on this topic.

 

 

  • 1. para 4, sch 3 HB and CTB (Consequential Provisions) Regulations 2006 SI No.217
  • 2. See for example R(H) 2/07, R(H) 6/08, R(H) 4/09, Chorley BC v IT (HB) [2009] UKUT 107 (AAC); Salford CC v PF [2009] UKUT 150 (AAC); Bristol CC v AW [2009] UKUT 109 (AAC)
  • 3. DWP, Housing Benefit Reform – supported housing, Cm 8152, July 2011
  • 4. Letter from the DWP UC Policy Division to the Social Security Advisory Committee dated 21 September 2012, and issue 131 of the DWP’s Housing Benefit Direct, November 2012
  • 5. Housing Benefit Direct, November 2012
  • 6. DWP, HB/CTB General Information Bulletin, G10/2012