Council Temp Accommodation Costs Surge to £1 Billion Gap
The financial strain on councils due to temporary accommodation has escalated significantly. The Local Government Association (LGA) reports a £260 million gap between council spending and Department for Work and Pensions (DWP) reimbursement. This comes as the number of households in temporary accommodation has surged by 11.8% since March 2024, reaching 131,140.
Over the past six years, the cumulative funding gap has reached £1 billion. Councils cover upfront costs of housing benefit for these households before being reimbursed by the DWP. In 2023/24, councils spent £1.04 billion on temporary accommodation, but received only £780 million from the DWP, a shortfall of £260 million, marking a 30% increase from the previous year.
The LGA is calling for reimbursement rates to be updated to current Local Housing Allowance (LHA) levels. They warn that without reform, pressures on council finances will continue to escalate, undermining efforts to tackle rising homelessness. Currently, reimbursement is capped at 90% of LHA rates set in 2011, despite rental costs having risen significantly since then. Aligning reimbursement rates with current LHA levels could have provided councils with £941 million in 2023/24 instead of the £780 million they received.
The LGA, representing local authorities, is urging the government to update reimbursement rates for temporary accommodation to reflect current market conditions. This would not only help councils manage their budgets more effectively but also ensure adequate support for those in temporary housing. Failure to address this issue could exacerbate financial pressures and hinder councils' ability to combat homelessness.
Read also:
- State Supreme Court Rules in Favor of Hogg Hummock Residents, Referendum on Zoning Change to Proceed
- Germany's Coalition Explores Social Security Reforms Amid Record Spending
- chaos unveiled on Clowning Street: week 63's antics from 'Two-Tier Keir' and his chaotic Labour Circus
- Skechers Debuts First American Stores Focused on Athletic Footwear Performance
