Agenda item

ORDERED that Executive:

 

1.    Approve the business case set out in Appendix one of the report aimed at delivering the savings identified within the Council’s Transformation Programme as REG07;

2.    Approve the use of approved capital resources from the Towns Fund (£4m) and Levelling Up Partnership (£2.141m), as set out in the Business Case included, as Appendix one of the report, to acquire and refurbish properties to increase the supply of housing in order to reduce expenditure on temporary accommodation.

3.    Delegate authority to the Director of Regeneration, following consultation with the Executive Member for Development, to utilise the three delivery proposals set out in paragraphs 4.11 to 4.13 of this report, within the approved funding envelope of £6.141m, to maximise potential cost reductions.

The Executive Member for Development submitted a report for Executive’s consideration. The report sought Executive approval to implement a cohesive and co-ordinated approach to providing a housing supply model that addressed the needs of residents at risk. This included those at risk of homelessness, particularly families, single people with complex needs and young care leavers within Middlesbrough. This would also help to reduce the significant financial costs to the Council of providing temporary accommodation.

 

The ambition behind the introduction of The Homeless Reduction Act 2017 was “to shift the culture of homelessness services towards prevention and provide assistance to all eligible people in need of it, removing barriers for service users.”

 

The Act introduced an enhanced prevention duty extending the period a household was threatened with homelessness from 28 days to 56 days. This meant housing authorities were required to work with people to prevent homelessness at an earlier stage. It also introduced a new duty to those already homeless so that housing authorities would support households for 56 days to relieve their homelessness by helping them to secure accommodation (called the relief duty).

 

From April to June 2018 through January to March 2024, the number of households owed a homeless duty in Middlesbrough rose from 135 to 493, which was a 365% increase. Across the North-East, over the same time frame, the number of households owed a homeless duty rose from 3550 to 5480, which was a 154% increase. Whilst both increases were high, Middlesbrough’s rise in homelessness has been much more dramatic.

 

During the financial year 2023/2024, the Council spent £1.29m on temporary accommodation, which was the highest expenditure of any financial year to date. Without any housing market intervention, this would continue to be an annual cost pressure to the Council.

 

Additionally, there were 38 young people aged 17 who required accommodation at the point of leaving care at 18, which would potentially increase the cost pressure still further.

 

Authorities should, therefore, be expected to have more prevention cases than relief cases, as this would indicate a more upstream prevention approach was being embedded.

 

An assessment of Middlesbrough’s prevention and relief statistics over the period April 2018 to December 2023 had highlighted that Middlesbrough had not yet effectively embedded an upstream prevention approach to homelessness (and beyond the 56-day prevention duty).

 

The benefits of a prevention approach were that it cost less in the long-term. A modest investment in prevention activity and resource could prevent the use of expensive temporary accommodation or cross subsidised supported accommodation. It could reduce the need for Children’s Social Care intervention and costs associated with this.

 

The Executive Member for Childrens Services welcomed the report and commented the initiative would also help Middlesbrough’s young people.

 

The Chair of the Overview and Scrutiny Board advised Executive that the Place Scrutiny Panel was undertaking a review into empty properties and asked if the relevant Executive Member would be willing to attend a scrutiny meeting if necessary. Both the Mayor and Executive Member for Development welcomed the invitation and stated they would be prepared to attend a scrutiny meeting.

 

A Member queried where the housing would be located and its cost. The Mayor clarified the type of housing would be mixed, as would its location, depending on circumstances.

 

In term of funding, the Executive Member for Development clarified that grant funding, such as the Town’s Fund, was being used for the initiative. The Council would continue to invest in the initiative if it was successful.

 

ORDERED that Executive:

 

1.    Approve the business case set out in Appendix one of the report aimed at delivering the savings identified within the Council’s Transformation Programme as REG07;

2.    Approve the use of approved capital resources from the Towns Fund (£4m) and Levelling Up Partnership (£2.141m), as set out in the Business Case included, as Appendix one of the report, to acquire and refurbish properties to increase the supply of housing in order to reduce expenditure on temporary accommodation.

3.    Delegate authority to the Director of Regeneration, following consultation with the Executive Member for Development, to utilise the three delivery proposals set out in paragraphs 4.11 to 4.13 of this report, within the approved funding envelope of £6.141m, to maximise potential cost reductions.

 

OPTIONS

 

The following options had been explored and assessed as not delivering the same benefits as the recommended approach:

 

Do Nothing

 

The cost of accommodating people in private sector provision was forecast to increase further as demand outstripped supply. The local market was also geared towards the provision of accommodation only and was not aligned with the support packages required to maintain tenancies and deliver positive outcomes for people with complex needs or care leavers. As a result, the churn in placements would continue, the costs would continue to rise, and the stability required to reduce long term dependency would be missing.

 

Enter into a Partnership with an Existing Provider With Stock

 

The option to enter a partnership with an existing Registered Social Landlord would potentially allow some of the support services to be aligned with a property offer, but the economics of such a model did not work for the landlord without significant additional revenue input from the Council. Commissioning those services from a provider, but utilising stock owned by the Council would significantly reduce the costs.

 

REASONS

 

The funding available through the Towns Fund and Levelling Up Partnership would be used to create a supply of suitable accommodation with support (where needed) to reduce the usage of expensive temporary accommodation, reducing costs and creating better long-term outcomes for families, single people with complex needs, and young people leaving care.

 

The use of capital funding to acquire and refurbish properties to increase the housing supply would complement the proposals of the Empty Properties Strategy – Domestic, which was also be presented at the meeting.

 

If the recommendations of this report were approved, it was estimated that the cost of providing housing would be reduced by £2.091m over a five-year period.