Exempt accommodation – Where are we now?

It is some time since we have been able to provide any update on what is happening with Supported Exempt Accommodation and how it is to be treated under the new reforms. As you may remember, Sitra produced a detailed flow chart and guidance to help providers understand what did and did not constitute exempt accommodation and a series of regular updated FAQs. Both of these can be found on our newly developed website here.

Since then, Sitra and other organisations have been heavily engaged in discussions with both DCLG and the DWP to try and identify a solution to the gulf between stated intention – ie to remove the housing costs of supported exempt accommodation from Universal Credit in the short term – in order that a long term solution to how the housing costs could be paid in the future.

Late last night (4th April 2013) Sitra received a letter from Lord Freud restating his commitment to identify a solution and some of the key parts of the letter are noted in this blog:-

“It has recently been brought to our attention that much of the existing provision does not meet the precise definition of supported ‘exempt’ accommodation. This has, understandably, caused concern amongst providers.

 We would like to make clear our intention to protect providers from any unintended consequences. For example, we wish to protect refuges and hostels where care is provided by or arranged through a ‘managing agent’ rather than the landlord. Such arrangements may not meet the precise definition of exempt accommodation but in all other ways the provision is identical to that which does”

In the letter, Lord Freud refers to his intention being focussed on taking supported accommodation outside of Universal Credit. However, this is not the only concern. The letter makes it apparent that there is nothing immediate going to happen to sort out the ‘unintended consequence’ of the current situation. However, for projects affected by the bedroom tax, the consequences are being felt already. By the end of September, the household benefit cap will also have been rolled out beyond the four London boroughs it is currently being tested in. Time is not on Lord Freud’s or our side. We are aware that some supported housing projects are already being affected by the size criteria – and some of those include refuges and exactly the kind of projects that the DWP has been so vocal in stating their support for.

Although it is of note that alongside this letter, earlier in February the DWP also issued an urgent bulletin to Housing Benefit departments on this issue. The circular HBCTB/U1/2013.highlighted concerns raised by providers that HB departments were interpreting the new requirements to include the numbers of exempt accommodation in the housing benefit extract as a rationale to review previous claims and make adjustments to accommodation. This is of course concurrent with what Lord Freud’s current letter is saying – in a sense that he was anticipating that this concession to supported housing would not generate change within the sector. Later on in his letter he states:-

“Finally, I would like to use this opportunity to assure you that I am determined that our reforms will maintain a viable supported housing sector”

 In other parts of the letter he talks about the need to ‘develop workable solutions’ and it is apparent that whilst he is acknowledging the challenge inherent in the current definition for managing agents – there are many other situations where the current definition does not include provision – which up until now has been treated in the same way as accommodation that does fit in. This is a complex area, and one where no ‘quick fix’ has come to the fore – either for the short term, or for the long term treatment of housing costs of supported housing. Without an answer soon – the government’s stated ambition to ‘maintain a viable’ sector have the potential to be undermined by the hundreds of  different HB authorities interpreting the current ‘guidance’ in different ways.


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