Spending on temporary accommodation in London boroughs rose by nearly 40% last year, new data from London councils has revealed.
London Councils headquarters in Southwark, south London (Photo: Google Street View)
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Last year, monthly spending on temporary accommodation in London reached £90m #UKhousing
Spending on temporary accommodation across London boroughs rose by almost 40% last year, new London City Council data reveals #UKhousing
A cross-party group representing the capital’s councils has revealed that spending on temporary housing for homeless households will reach £90m a month in 2022-23.
The newspaper warned that if spending of £90m per month continues, more than £1bn a year will be spent on temporary accommodation for homeless Londoners.
The group said soaring homelessness rates and a severe shortage of affordable accommodation were putting a huge strain on boroughs’ budgets, which it deemed a “grave risk” to their financial stability.
Ahead of next week’s Budget, the London Assembly has announced further government support to help Parliament meet these costs and reduce the risk of requiring a section 114 notice – effectively declaring bankruptcy. I’m looking for it.
Birmingham, Croydon, Thurrock, Woking, Nottingham and Slough councils have all issued section 114 notices from 2021 onwards.
Since the enactment of the Local Finance Act in 1988, 14 councils have issued this notice.
The London Assembly said ministers’ top priority would be to remove the “unfair” cap that boroughs can receive from the government to help pay for temporary accommodation. This cap is currently tied to the 2011 benefit rate, which does not reflect temporary accommodation costs.
Inside the housing It recently reported that the rules would cost Sheffield City Council £5.9m in 2022-23.
The number of Londoners seeking homelessness support from their local borough, in addition to paying for temporary accommodation, rose by 14.5% between September 2022 and September 2023, according to analysis by London Councils.
The number of households in London living in temporary accommodation arranged by their local borough rose by 7% over the same period.
At the same time, many private landlords who rent properties to councils for use as temporary accommodation are canceling these agreements to instead rent to private tenants or sell the properties outright.
The analysis found that the number of landlord “notices to quit” each district received increased by 56.5%.
Darren Rodwell, Executive Member for Regeneration, Housing and Planning at London Councils, said: “Homelessness has a devastating impact on individuals and families, and at the same time poses significant and unsustainable costs to borough budgets. “There is,” he said.
“Boroughs are working hard to house London’s homeless population. But London’s ballooning temporary accommodation bill poses a significant risk to boroughs’ financial stability.
“It is no exaggeration to say that if things continue as they are, the huge costs will pose a risk of bankruptcy.”
The group said it was calling on ministers to increase funding for boroughs “facing a worsening homelessness crisis”.
A spokesperson for the Department for Leveling Up, Housing and Communities said:
“From April, the Government will increase local housing benefit to the 30th percentile of market rents, giving 1.6 million low-income households an average annual benefit of around £800 a year to help pay their rent and stay in their own home. There is.”
“We are delivering more than £1 billion to councils over three years through homelessness prevention grants, including £352 million for London from 2023 to 2025.”
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