Newcastle homeless funding cuts scaled back after charities' fury at 'inhumane' plans

Major cuts in support for Newcastle’s homeless have been scaled back, after warnings that the move would leave people to die on the streets.

Newcastle City Council was accused last year of putting forward an “inhumane” proposal to halve the amount of money it spends on commissioning beds and other support services to help people off the streets, from £3.3 million to £1.6 million. Amid pressure from leading charities, the local authority ultimately pressed pause on the idea and pulled it from final budget proposals in February in order to carry out a further review. Civic centre bosses have now confirmed a significant overhaul to the plans.

The council says it is now seeking to save £320,000 when it renegotiates it homelessness service contracts, which are due to expire at the end of March, and that the number of beds available to support homeless people Newcastle will remain “broadly the same” as the current 734. Shelter had called the original proposals a “significant reduction in the compassionate treatment of our homeless community”, in a city which had previously won international acclaim for its work to combat rough sleeping.

The charity had warned in a letter to the council that cutting funding risked the emergence of a “tent city” and a “changed landscape where there is more rough sleeping, more deaths on the street, more begging and potentially more crime, especially in the city centre”. Changing Lives, one of the council’s main providers of homelessness support, had also branded the cuts “inhumane” and predicted “devastating impact on the most marginalised people”.

According to figures obtained by Advice.co.uk, the number of rough sleepers counted in the city rose from 250 in 2021/22 to 315 in 2023/24.

This month, the council has set out plans to cut its spending by £21.3 million in 2025/26. However, a civic centre spokesperson confirmed that the homeless service cuts would not be returning in the form envisaged 12 months ago.

They said: “Next year the council has to save £21.3m to legally set a balanced budget. As part of meeting that challenge we will look to make savings when renegotiating contracts with our commissioned services. Last year we proposed a saving of £1.6m in homelessness provision but paused the idea amid a number of fundamental changes that were taking place at the time including taking the management of council houses back-in house.

“In February Cabinet agreed to carry out a review of commissioned homelessness services to better understand the level of service we offer. It discovered that 40% of people we housed were ready to move on when permanent accommodation became available, and one in four were receiving services they no longer required.

“So, when our contracts expire at the end of next March we will seek to renegotiate our contracts in a way which provides accommodation and services that better match the needs of those we are helping. Additional emphasis will also be placed on helping people move from temporary accommodation into long term housing which also contributes to our savings.

“As a result of these changes, we envisage overall bed spaces we commission – approximately 730 - will remain broadly the same however the council will save approximately £320,00. Newcastle has a national and international reputation for preventing and dealing with homelessness. By better matching the value of the contract to the needs of the service user, we will maintain the same level of standards while delivering them at a lower cost to the taxpayer.”

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