That this House has considered future funding of supported housing.
It is a pleasure to serve under your chairmanship, Mr Streeter. I am pleased to have secured this debate, which comes at an appropriate time, ahead of the Government’s publication of their response to the consultation that finished in February. I am aware that many colleagues want to take part in this debate. I shall do my best to accommodate them by taking interventions, but the pressure of time may mean that I have to disappoint some people, for which I apologise. Their presence, even if they do not get an opportunity to speak, says it all and sends out the right message. I confirm that I will support any application to the Backbench Business Committee for a longer debate.
[Sir Edward Leigh in the Chair]
This debate provides an opportunity to re-emphasise the vital importance of putting funding for the sector on a sustainable long-term footing and of the Minister providing a progress report on how the Government are getting on in formulating their plans. That is essential if we are not to let down a vulnerable group of people, whether they are elderly, young, physically disabled, fleeing domestic violence or facing mental health challenges. It is appropriate that this debate is taking place on world mental health day. Housing is essential to securing parity of esteem with physical health treatment.
The case for supported housing is compelling. Demand is rising for care and support as a result of an ageing population and increased levels of mental illness and learning disabilities. Supported housing enables older people to retain their independence, allows young people to live securely and get their lives back on track and ensures that victims of domestic violence can find emergency refuge and stabilise their lives. It helps homeless people with complex and multiple needs make the transition from living on the street to having a settled home and providing education and training to prepare them for work. It ensures that those with mental health needs can stabilise their lives and live more independently. Supported housing assists ex-servicemen and women who are experiencing difficulties in readjusting to civilian life. It ensures that people with learning disabilities can maximise their independence and exercise choice and control over their lives. Investment in supported housing provides an alternative to more expensive residential care settings such as care and nursing homes. In that respect, it provides good value for money.
Let me move on. The vital role that supported housing plays is recognised by all, as is the need for a sustainable long-term solution, not a short-term sticking plaster. This is not a straightforward challenge; it is vital for Government, Parliament and all those involved in the sector to work together to put in place the right funding framework. There are encouraging signs that that is happening, but there is still a great deal of work to do.
The Government made the correct first move by carrying out the first evidence review for 20 years. Its findings were published on 21 November last year—the same day the Government launched their consultation on their preliminary proposals, setting up four task and finish groups to address specific challenges. The preliminary proposals were announced on 15 September 2016 by my right hon. Friend the Member for Ashford (Damian Green), the then Secretary of State for Work and Pensions. In brief, they provide for people living in supported accommodation to have their core rent and service charges funded through housing benefit or universal credit up to the local housing allowance rate, and for costs above that rate to be distributed by local authorities from ring-fenced top-up funding provided by the Government.
The work by Government and by Parliament’s Select Committees provides the foundation stone for a new long-term funding framework in which housing associations, charities and social enterprises can invest and take up the significant amount of funding that the Government have made available over the past five years.
In the month before this debate, I received many representations that confirmed not only a willingness to engage with Government and Parliament but a worry that the proposals in their current form do not achieve their objective. I am happy to share all those representations with the Minister. The National Housing Federation, which represents English housing associations, has expressed concerns. The Chartered Institute of Housing has emphasised that the stakes are very high and that if we get this wrong, the implications for the public purse—not to mention life chances—are frightening.
One Housing, a major provider of affordable housing in London and the south-east, is extremely concerned about the plan for a cap on the housing benefit to the level of the local housing allowance. It believes that it will have a dramatic impact on older people’s housing with care schemes and could reduce new supply. The Home Group, which is active in the north-east, Cornwall and East Anglia, including in Lowestoft in my constituency, is concerned that reliance on LHA rates could lead to a postcode lottery. It has put on hold the development of 1,842 units across the country while it awaits clarification on the proposed system.
The Associated Retired Community Operators, which is the main trade body representing the retirement community sector, has also expressed concerns.
Leonard Cheshire Disability has also expressed a concern to me. Rethink Mental Illness and Mencap have similar concerns. They highlight the important role played by supported housing in helping people affected by mental illness to recover, move on and live independently. They stress the need to think outside departmental silos and to engage with NHS England. It is worth bearing it in mind that a 30-day delayed discharge from a secure ward costs £16,890 and the same delay from an acute setting equates to £13,170. That compares with the cost of the most expensive forms of mental health supported housing, with added support costs, of around £2,000 per month.
Supported housing also has a vital role to play in ending rough sleeping, as St Mungo’s has highlighted in its “Save Hostels Rebuild Lives” report, which was also published last month. The Salvation Army has expressed concern that its 60 Lighthouses across the UK could be put at risk and it is calling on the Government to delay the introduction of any new funding system until 2022.
Clearly, this issue has brought us all together. Can we say in the strongest possible terms to the Minister that we really need to sort this out, and if it is not sorted out we need to come back to the House and go into a lot more detail in another debate, in which I would like to make a speech in favour of Estuary Housing Association?
My first proposal is that the Government should give full and serious consideration to adopting the recommendations made by the Communities and Local Government and the Work and Pensions joint Select Committee; it has made its case well. Under the auspices of Lord Best, Housing and Care 21, Riverside, the Home Group and Hanover Housing have analysed data from approximately 43,000 supported housing and older people’s tenancies across the UK, and concluded that a supported housing allowance proposal represents a viable and workable approach. Although I recognise that the Government have to study that analysis closely, this proposal could be a sensible way forward.
Secondly, it is important that the Government examine very closely the impact of universal credit on the supported housing sector, particularly as the rollout is due to be ramped up in the next few weeks. Universal credit in its current form is in many respects incompatible with supported housing. The local housing allowance rate was designed for the private rental sector and bears no relation to costs in the supported housing sector. It also introduces levels of variation in funding through the benefits system across the country, which are greater than the variation in costs of delivering supported housing. This could leave parts of the country particularly exposed and it could skew development towards areas with higher funding rather than highest need.
Thirdly, there is a need for the Government to provide a revised timetable for working up the new funding framework with providers, road-testing it, carrying out an impact assessment and then introducing it. The general election has thrown the previous timetable somewhat off course. I anticipate that the Minister will advise us as to when the Government will respond to the consultation that closed in February, and whether they are still intending to introduce the new system on 1 April 2019. An early statement is required to address the concerns I have outlined, which have been echoed all across the Chamber, and to set out a clear direction of travel. It would be helpful to receive some indication as to whether a pilot or a shadow year—as the Under-Secretary of State for the Cabinet Office, my hon. Friend the Member for Romsey and Southampton North (Caroline Nokes), suggested when she was Under-Secretary of State for Work and Pensions—might also be considered.
In conclusion, Sir Edward, I am grateful to you for bearing with me. It is important that we get this matter right, as the lives of many vulnerable members of society depend on it. I acknowledge that this is not a straightforward task, but I sense that, by working together, a partnership of Government, Parliament and the supported housing sector can put in place a long-lasting framework that will provide dignity, peace of mind and hope to residents. They deserve no less.
I will begin my response to the debate by thanking my hon. Friend the Member for Waveney (Peter Aldous) for securing this important debate and for granting me the opportunity to outline the significance that the Government attach to supported housing. I know that he has been following the issue extremely closely and has been a great advocate for the sector and the people it supports. The importance of supported housing to right hon. and hon. Members is demonstrated by the number of them here in the Chamber today.
Supported housing plays an invaluable role in our society, helping some of our country’s most vulnerable people to live as independently as possible. Supported housing serves as an important lifeline for vulnerable older people, individuals with learning disabilities and physical impairments, those at risk of domestic abuse and many other vulnerable people. It is also an investment—a point made by my hon. Friend the Member for Waveney—that brings savings to other parts of the public sector, such as health and social care. It is essential, therefore, that we introduce the funding model for supported housing and make sure that it is on a sustainable footing, ensuring that it works for providers, commissioners and vulnerable tenants, as well as for the taxpayer.
We recognise the value of local strategic planning, partnership working, commissioning and oversight, and we are keen to encourage local government, providers of supported housing and the wider public sector to continue to develop a joined-up, strategic, holistic approach with a greater local focus very much on outcomes, oversight and value for money.
As my hon. Friend the Member for Waveney knows, our consultation on supported housing concluded earlier this year. We welcomed all the responses, of which there was a significant number—592—and we have been careful in taking stock of the views from the sector, local government, other stakeholders and Members of this House. We also welcomed the Joint Committee inquiry, and its subsequent report, into the future funding of supported housing, and we have been considering its recommendations. I thank Members who served on that Committee for their work and their input into the process.
Let me assure the House that we have been taking all of this thoughtful and reflective input into account as we continue to develop our plans. This matter is a priority for the Government, and we will announce the next steps shortly—later this autumn. I believe that when those proposals are introduced, they will show that we have listened and have understood the important issues at hand and the important situation. What is at stake is helping and supporting some of the most vulnerable people in our society.
We want the design of the reformed funding model to be flexible. We also want it to be responsive enough to meet the various demands placed on it by a diverse sector and client base. We have therefore been working closely across Government to understand and consider the needs of individuals who require long-term supported accommodation, such as people with learning disabilities, physical and sensory disabilities and mental health problems, and disabled older people. That is why we want to commit to supporting the most vulnerable in our society with £400 million of capital funding to deliver new specialist affordable homes, particularly for the elderly and people with learning disabilities.
I would now like to pick up the points that my hon. Friend the Member for Waveney made. Both he and other Members mentioned the work done by Lord Best and my hon. Friend the Member for Gloucester (Richard Graham), and I have had sight of their proposal, which is about developing a bespoke supported housing allowance. I am most grateful for their recommendations and for the suggestion about maintaining funding from the welfare system and testing and developing a banding system to provide cost controls that reflect the costs of provision in a particular area and for a particular type of supported housing. That is something we are considering very carefully.
In relation to the point that my hon. Friend the Member for Waveney made about piloting and further consultations, we will work closely with the sector and listen to what is being said during consultation. There may well be a case for testing proposals in some way, and we expect to set out further details about how we will go about introducing our proposals. What I underline, again, is that we are listening to the sector.
Sir Edward, I think you are going to pull me up very soon for running out of time, so I would just like to reassure right hon. and hon. Members that the Government have considered the consultation very carefully and have considered the proposals—
Motion lapsed (Standing Order No. 10(6)).