Increase in council funding for homeless shelters reaches nearly 30%
In a pressing concern that's garnering significant attention, the total gross expenditure by councils in England on temporary accommodation for homelessness reached an staggering £2.84 billion in the financial year 2024/25. This figure, a substantial increase from the previous year, has sparked calls for reform from various quarters.
Tom Hunt, from the Local Government Association, has highlighted the need for the Government to update the current reimbursement rate for temporary accommodation costs, arguing that the current rates, which date back 15 years, are outdated. He also advocates for the restoration of the Local Housing Allowance (LHA) rates to at least the 30th percentile of local rents beyond 2025-26.
The increase in expenditure is not limited to a single sector. The figure for private sector accommodation, leased by a local authority or registered provider, rose by 18%, from £177 million to £210 million. Spending on hostels, which can include refuges, saw an increase of around 21% from the previous year, amounting to just over £36 million.
However, the figures do not reveal the human impact of living in temporary accommodation. John Glenton, at Riverside, has called for a significant and sustained increase in new social housing and dedicated ring-fenced funding spent on homelessness services and supported housing.
The increase in net spending on temporary accommodation was a significant 30.5% compared to the previous year. Notably, net spending on nightly paid, privately managed accommodation saw the 'most significant increase', amounting to £620 million in the year to March.
Private providers are charging eye-watering sums for temporary accommodation, a concern echoed by Catherine Parsons, managing director of the Big Issue, who stated that local authority budgets are buckling under the weight of the over-reliance on temporary accommodation.
Mairi MacRae, director of campaigns and policy at Shelter, has also expressed her concerns, stating that money spent on temporary accommodation is draining billions in public funds and families are paying the ultimate price. She further emphasised that there's nowhere near enough social homes and as a result homelessness has reached record levels.
Thousands of desperate families are showing up to their council's doorstep for help, a stark reminder of the urgent need for action. As the debate continues, it's clear that addressing this issue is crucial for the well-being of countless families across England.
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