As well as a new funding model, we must address the shortfall in supported housing

As the deadline looms for the Government’s consultation on supported housing, our new research confirms how high the stakes are.

Alistair Smyth is Head of Policy at the National Housing Federation

Alistair Smyth is Head of Policy at the National Housing Federation

9 February 2017

Alongside this new research, we are today also publishing and submitting our response to the Government’s consultation on supported housing, in which we make our case for how we believe the Government’s proposed funding model could be strengthened.

The National Housing Federation and our members have been working hard over the last year to find a way forward for the funding model that works for providers, tenants and the Government. Supported housing provides a safe and secure homes for vulnerable people, and enables them to live in their own home and community. 

Its beneficiaries are numerous and diverse. Among others, they include:

  • victims of domestic violence
  • homeless people and those sleeping rough
  • people with mental health issues
  • people with learning disabilities
  • older people wanting to maintain their independence
  •  ex-servicemen and women. 

The last year has been an extremely uncertain time for supported housing providers and tenants. A new model has been proposed, and we will understand much more about how the sector and stakeholders have reacted to that once the Government publishes its Green Paper on supported housing later this year.

Our new research, undertaken by Sitra, shows that there is an urgent need for more supported housing. In 2015/16, we had a shortfall of nearly 17,000 places for working age people. With no intervention to increase the number of places, that figure will more than double by 2020/21 to 35,166. Previous work undertaken by the Housing LIN has estimated there will be a shortfall of 240,000 purpose-built homes for older people by 2030.

Supported housing is an essential part of a system that provides health, care and support services to people that need it. Not only does it deliver improved outcomes for those people, it's a great deal for the taxpayer too. Our research estimates that the current shortfall cost the taxpayer an estimated £361m in 2015/16. The five year cumulative cost to the taxpayer of failing to plug the supply gap is estimated at £2.72bn. 

There are a number of ways a lack of supported housing incurs costs elsewhere in the system. For example, if someone becomes homeless through not having a supported housing place, they may have increased contact with substance misuse services, criminal justice agencies, or mental health services. The costs of staying in hospital, care homes or foster care exceed by some margin the cost of living in supported housing. 

It is vital that the funding model arrived at for supported housing is right. The research shows that demand for working age supported housing will increase by 9% by 2020/21, while provision is likely to drop by nearly 9% without intervention to provide more places. Our responses to both the Government’s consultation and to the joint DWP/DCLG select committee inquiry into supported housing set out our concerns, and this Local Housing Allowance (LHA) caps discussion paper explores the case for a higher cap, which we think would be a better basis for the model.

Our summary report and the full Sitra report are here, as well as a detailed technical index which explains the approach in much more detail. 

The Government's consultation on supported housing closes on 13 February 2017. Please get in touch with any queries at

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