Background

  1. As many of you reading this blog will already know, the exempt system was devised when the Government acknowledged that landlords incur far higher costs in providing supported housing. To only have availability to the restricted benefit levels that apply to ordinary needs residents would render exempt schemes unviable. Therefore, the purpose of the exempt system was, and remains, a necessary need for a society who want to care for their more vulnerable members.

  2. Now, many years after its creation, how much is the exempt system used and is it operating as originally intended by the Government? Is the extra funding going to those who most need it or is it providing an easy income stream for doing very little for the less scrupulous landlords who see it merely as an opportunity to make money?

Exempt accommodation today

  1. Freedom of Information data from the Department for Work and Pensions showed that as of May 2021, 153,701 households in Great Britain were housed in exempt accommodation. This represents a 62% increase from 2016 to 2021 (Over 150,000 households in controversial exempt accommodation, Crisis, 21 September 2021).

  2. It is estimated that at least £816 million has been spent on exempt accommodation in the last financial year alone (Safe Successful Sustainable: A shared vision for better homes, support and opportunities, Prospect, October 2021).

  3. What is immediately apparent from these statistics is that exempt accommodation has grown beyond all expectations over the last few years with eye-watering funding required to meet the demand.

Is exempt accommodation regulated?

  1. In a policy briefing (Tackling problems with non-commissioned exempt housing, October 2021), the homeless charity, Crisis, noted that: “ .....where registered providers are judged to be providing ‘non- social housing’, as is often the case for exempt providers, they are not subject to even reactive consumer regulation.”

  2. In contrast to this, where a service is commissioned by a local authority, the commissioning body (usually the local authority) would be responsible for monitoring delivery of the service and ensuring it meets the contractual requirements.

    1. However, whether an exempt provider is commissioned or not, all providers seeking the exempt status for their residents will undergo the scrutiny of their local authority who hold an oversight role in ensuring that Housing Benefit (“HB”) claims comply with the requirements set out in legislation.

Is local authority regulation sufficient?

  1. As advisors in exempt accommodation, we have been working with different local authorities for many years. In that time we have observed that the regulatory role of the local authorities up and down the UK seems to lack uniformity. Whilst some authorities take a rigid, almost forensic, approach to overseeing the distribution of HB funds to exempt accommodation providers, others appear to adopt a more relaxed approach leaving one to conclude that whether or not a provider has a straightforward approval of their exempt scheme depends to some extent on their location.

  2. Having said the above, it is also fair to state that recent exposure of rogue providers and Government awareness of potential abuse of HB funds, is forcing all local authorities to tighten their approach to prevent current and potential future rogue providers from wrongly benefitting from the exempt scheme.

  3. Crisis has called on the Government to identify additional assistance that local authorities will need to help them to ensure that non-commissioned, shared exempt accommodation meets acceptable standards for the long term benefit of vulnerable service users.

What further regulation may be coming?

  1. On 17th March 2022, the Minister, Eddie Hughes, issued a written statement setting out the Government’s plans for supported exempt housing. These can be summarised as being: (a) To set minimum standards for the support to be provided to residents to ensure they all receive good quality support; (b) To provide new powers for local authorities (in England) to manage the supported housing market; (c) To make changes to the HB regulations with a view to defining care, support and supervision to improve the quality and value for money of all specified supported housing provision; and (d) To introduce any legislative measures deemed necessary when parliamentary time permits.

  2. Subsequently, a private member’s bill was introduced by Bob Blackman MP on 15 June 2022 (Supported Housing (Regulatory Oversight) Bill). The purpose of this bill is to give local authorities greater power and oversight of supported exempt accommodation. The second reading of the bill is scheduled for 18 November 2022.

  3. So, it seems that changes are on the horizon and perhaps many will consider that these are long overdue.

MR Associates - December 2022