Councils putting public services at risk due to homelessness support

Town halls are spending as much as two-thirds of their council tax revenue on homelessness support, putting other vital services at risk.

New analysis has found that three local authorities in England are using up at least half of the money they receive from residents on temporary accommodation.

The research by the District Councils’ Network (DCN) identified 16 local authorities where more than a quarter of council tax receipts went on supporting homeless households last year.

The highest proportion (67 per cent) was spent by Crawley Borough Council, followed by Hastings Borough Council (58) and Dartford Borough Council (50).

It comes after the number of households in temporary accommodation rose by 12 per cent last year to reach 117,450, including 74,530 with children.

Cash-strapped town halls say the crisis means they are having to divert funding earmarked for the other services they provide.

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Cllr Michael Jones, Leader of Crawley Borough Council, said: ‘The cost of temporary accommodation is now the greatest threat to district and borough councils’ budgets.

‘Last year it cost our council £5.5m, compared to £262,000 in 2018/19. This is £2 for every £3 we get in council tax, which is spent on temporary accommodation - put frankly, most of it. If this continues, we will have no choice but to cut other services to continue to fund this.’

The DCN is calling on ministers to review temporary accommodation funding.

In particular it wants them to lift the cap on the amount it pays councils, which is based on 2011 rental costs.

DCN housing spokesman Cllr Hannah Dalton: ‘For too long the Government has increasingly shunted the costs of homelessness onto councils and their residents, straining our budgets to breaking point.

‘Residents will be shocked to learn that the equivalent of as much as half of their council tax is being spent on temporary accommodation rather than the local services they expect their council to deliver for them. This housing crisis is impacting on every taxpayer and the entire community.

‘When such a large sum is diverted to temporary housing, it leaves little for community initiatives, leisure services, green spaces and essential amenities.’

A government spokesperson said: ‘We know homelessness is far too high and it is having a devastating impact on those affected. Councils already receive funding to help meet the cost of temporary accommodation, but we will provide them with more stability through multi-year funding settlements.

‘The Deputy Prime Minister is taking action to tackle homelessness with ministers across government through a dedicated Inter-Ministerial Group where they will develop a long-term strategy to get us back on track to ending homelessness.’