Temporary accommodation is costing councils £2 million a day

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The housing shortage is forcing councils to spend more than £2 million a day on temporary accommodation for homeless families, LGA analysis has revealed

Government is being urged to use the Spring Budget to free councils from borrowing constraints that hamper their ability to build new homes, and to adapt welfare reforms to protect families at risk of homelessness.

Analysis by the Local Government Association (LGA) indicates the number of affordable homes built in 2015/16 fell by 52%. Just 6,554 social rented homes were built over the period – the lowest number in almost a quarter of a century.

Homelessness is spreading across all areas

A chronic lack of affordable housing and stagnating household incomes have contributed to a dramatic rise in the number of households placed in temporary accommodation. Local authorities have seen a 50% increase in the number of individuals and families forced into this situation since 2010.

In these last five years, the use of temporary accommodation has gone up 44% in London and 67% across the rest of England.

“Homelessness is spreading across all areas of the country,” LGA chair Lord Porter said yesterday.

“Funding pressures are combining with a lack of affordable housing and private sector rents rising above household incomes to increase homelessness. It is also leaving many councils struggling to find suitable accommodation for those in need, particularly those who are young, vulnerable, or with families.”

Currently, around 75,000 households are living in temporary accommodation, which might be a bed and breakfast, a hostel or a private rented property. The cost to councils stands at £2.6 billion in the past three years alone, the LGA analysis shows.

£2m a day on temporary accommodation is unsustainable

The organisation is calling on the Chancellor, Phillip Hammond, to temporarily lift the Local Housing Allowance freeze as part of his Spring Budget tomorrow to help ensure councils can continue to provide of accommodation for vulnerable families.

“With councils continuing to face huge financial pressures, it is unsustainable for them to have to spend £2 million a day to house vulnerable people at the sharp end of our housing crisis,” Lord Porter argued. “Councils would much rather invest this scarce resource in building new affordable homes and preventing homelessness happening in the first place.

“A renaissance in housebuilding by councils and a plan to reduce the squeeze on household incomes are both needed if we are to stand any chance of solving our housing crisis, reducing homelessness and the use of temporary accommodation, and sustainably reducing the housing benefit bill.

“Communities across the country need a new deal with the Chancellor that gives councils the ability to borrow to invest in housing and to keep 100% of the receipts from any homes they sell to replace them and reinvest in building more of the genuinely affordable homes they desperately need.”


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