A Quiet Crisis

Monday, 24 September 2018 - 12:45pm

Charities have made heroic efforts to tackle homelessness and rough sleeping for years and as a funder, we do our best to support as many as we can.

hands holding a cardboard cutout house

At Lloyds Bank Foundation tackling homelessness has always been a core priority. We currently fund and support nearly 100 charities – including many Homeless Link members – working to prevent homelessness in communities right across England and Wales.

The issues they face are well known: a lack of affordable housing, reductions in funding and changes to housing benefit. This, compounded by cuts to support services, is driving up homelessness and making it harder for homeless people to get the help they need and for the charities working with them to provide it.

Whilst local government is often seen as the bogeyman, imposing cuts on hard-pressed charities and providers, we can’t ignore the extreme financial pressure they themselves are under. To understand the picture better we commissioned new research from the New Policy Institute looking at local government spending on services for adults and children facing disadvantage. 

New research

A Quiet Crisis analyses official government data on local authority spending in England over the five years since 2011/12 on services including homelessness, mental health, learning disabilities, asylum seekers, addiction and looked-after children.

The findings for homelessness are particularly alarming. Spending on housing services for disadvantaged people has been cut by 13%. Within that the Supporting People programme was cut by 57%, yet spending on temporary accommodation has increased by 57% to become the largest category of spend. In total in 2011/12 local authorities were spending some £1290m on preventive housing services compared to £610m on crisis support. Five years later and the picture has completely switched with preventive services being cut £590m or 46% to try to accommodate a 58% increase on crisis spending to £970m.

Of course, councils must respond to the 60% increase in demand for temporary accommodation and the more than doubling in the number of rough sleepers. But to do so they are having to cut spending on the very services that would help to prevent and avoid such homelessness in the first place! This is a false economy on an epic scale, storing up further pain and costs down the line.

In London specifically, the boroughs have increased their spending on homelessness by 20%, (primarily to meet the 70% increase demand for temporary accommodation) but to do so they have had to cut spending on preventive services to 15% of their spend on homelessness, the lowest overall share of any authority type. Outside the capital, to accommodate large increases in demands on social services, particularly for children, local authorities have had to raid the homelessness and housing budgets by up to 52%.

Reduction in services

Homelessness does not exist in isolation and other key services have seen similar cuts. In just three years, spending on youth justice has fallen 14%, spending on local welfare assistance – which plays a key role in helping people stay in or resettle in accommodation – has been cut by 26% and funding for addiction services is down a massive 59%.

So why is this happening? The core reason is the cuts in central government grants of up to 50%. Local councils are now reliant on raising more money from council tax and business rates, despite many, particularly deprived areas, being unable to do so. Whilst the particular challenges facing Northamptonshire have made the news, even well-run local authorities are struggling to make ends meet. There is only so long this can continue before all that’s left are massive reductions in services and a post-code lottery with those deprived communities where need is highest being left even further behind.

Charities have made heroic efforts to tackle homelessness and rough sleeping for years and as a funder, we do our best to support as many as we can, but your efforts and our resources are finite and cannot fill the gap. As you know over the summer the Government published a new strategy to tackle rough sleeping. There were lots of welcome measures in it but the lion’s share of work to tackle homelessness will always be done at the local level and funded by local councils. The Strategy will just be a drop in an ocean of need if nothing is done to sort out these wider issues in local government funding.

So in the Budget and forthcoming Spending Review, the central Government must urgently look again at how it funds local councils to enable them to provide and fund services for those who need it the most. We called our report 'A Quiet Crisis' – for the sake of the very real lives that will be affected by homelessness now and in the future, it is time now to get noisy and to make the case for change.

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Duncan Shrubsole

Director of Policy, Communications and Research at Lloyds Bank Foundation

Duncan is Director of Policy, Communications and Research at Lloyds Bank Foundation for England and Wales.

Twitter: @LBFEW