Calls to scrap proposed reforms to housing payments for vulnerable people

Plans to reform housing payments for 70,000 vulnerable residents have caused "considerable concern" and must be immediately scrapped, MPs have said.

Local housing allowance (LHA) rates are set to come into force in two years that would mean providers of sheltered homes were paid different amounts depending on where they are based.

Campaigners have warned thousands of residents, including frail pensioners, victims of domestic violence and people with mental illness, could lose their homes under proposed funding changes.

The proposals, which would be topped up through a ring-fenced funding pot, have been consulted on and a green paper is expected to be published after the election.

A joint inquiry by the Work and Pensions and the Communities and Local Government committees said linking supported housing to private rental LHA rates was an "inappropriate starting point" for a new funding system.

"The Government's proposals mean some areas will have a far greater reliance on a local top-up than others, which could create a disparity in the supply of homes and services offered in different parts of the country," the report warns.

MPs called on the Government to introduce a supported housing allowance with bands that reflect the true cost of different types of accommodation.

National standards allowing the quality of provision across England and Wales to be assessed should also be set up, the committees said.

Labour's Helen Hayes, who co-chaired the inquiry, said: "The proposals have caused considerable concern.

"Supported housing providers are reconsidering investment plans, shortfalls in the levels of service are expected to get substantially worse and vulnerable tenants are anxious that they may no longer have the guarantee of a home for life.

"Ministers must intervene immediately by scrapping the proposed Local Housing Allowance reform.

"The sector needs a far more suitable funding system that recognises the consistent cost of provision across the country and provides long term reliability.

"Supported housing caters for an incredibly diverse range of people, from long-term sheltered accommodation for older people to short-term emergency housing for those who have recently become homeless or are fleeing domestic abuse.

"The Government is right to consider alternative funding for emergency accommodation and we urge ministers to also recognise the unique challenges of refuges with a distinct funding model."

Around £6.17 billion was spent on supported housing in 2015.

Conservative Richard Graham, who co-chaired the inquiry, said: "We support the Government's aims to reform funding for this vital sector to ensure quality and value for money, protect and boost supply, and provide greater local control.

"But we are concerned that the proposals, as they stand, are unlikely to achieve these objectives.

"Our recommendations seek to improve the Government's plans and ensure it delivers on our common goal of a sustainable, long-term funding solution for supported housing.

"We agree with the Government that it is necessary to find a long-term, sustainable funding mechanism that ensures quality, provides value for money, and which protects and boosts the supply of supported housing.

"However, we are concerned the Government's funding proposals, as they stand, are unlikely to achieve these objectives."

Jan Tregelles, chief executive of learning disability charity Mencap, said: "This report is a stark warning that the homes and lives of some of the country's most vulnerable people are in jeopardy should the proposed changes to supported housing go ahead.

"People with a learning disability depend on supported housing to live independently."

Danielle Hamm, associate director of campaigns and policy at Rethink Mental Illness, said: "For many people living with severe mental illness supported housing is key to their health and recovery.

"If the next government goes ahead with plans to radically change how it is funded many could be left with a shortfall on their rent and chronic instability, endangering their safety and wellbeing.

"We're very glad to see that the Select Committee has recognised the potential human and financial cost of this damaging policy and called for it to be scrapped. We hope that the next government will listen to the committee and abandon this disastrous idea."