Councils have spent billions of pounds putting homeless people up in bed and breakfasts, hotels and private rented homes, according to figures obtained by The Times.
In London, where the problem is worst, councils spent more than £1.25 billion over five years. Spending on temporary accommodation has risen by 143 per cent since 2011-12 and spending on B&Bs nearly trebled.
Data provided by London councils shows that the average length of stay rose by more than a third to 268 days, despite the rules stipulating a six-week limit.
Campaigners blame private landlords who have “got local authorities over a barrel”, the right to buy council property and a lack of construction.
Sources in local government expressed serious concern about the Homelessness Reduction Bill, due to have its second reading in the House of Commons later this week, claiming it could worsen the problem. Under the proposals, councils will be required to help people who are likely to become homeless within 56 days.
“A duty will be placed on councils to put people in temporary accommodation rather than try and find a solution for them,” said one senior figure. “It’s going to cost an absolute fortune. It’s a bill written with the best of intentions and catchy name, but it’s going to be a disaster that will massively undermine our ability to actually prevent homelessness.”
Julie Rugg, of the University of York’s centre for housing policy, said that councils were being “manipulated”: “Very particular types of business and landlords that deal in temporary accommodation have shifted the market from a long-term leasing model into a short-term, sometimes nightly, rates model. It’s much more profitable.”
Matt Downie, director of policy and external affairs at Crisis, said that the problem was a national scandal. He said: “What we need to be doing in the private rented sector, particularly for low-income households, temporary accommodation and B&Bs, is driving up standards and getting rid of rogue landlords.”
Camden council in north London bucked the trend by reducing its spending on temporary accommodation by 27 per cent to just under £10 million.
Pat Callaghan, the council’s cabinet member for housing, said that the borough promoted two-year tenancies and had strong bonds with landlords.
London councils on average spent £12 million on temporary accommodation in 2015/16, compared with £10 million in Birmingham, £8 million in Manchester and £196,000 in Oxford.
Westminster spent £45 million on temporary accommodation in 2015/16, the highest in London, followed by £30 million in Waltham Forest and £29 million in Lambeth. Cardiff council, which spent just £1.6 million on temporary accommodation in 2014/15, said it had reduced its expenditure by focussing on homeless prevention.
Matthew Bennett, Lambeth’s cabinet member for housing, said the borough recently launched a £15 million social investment fund, guaranteeing 47 properties for housing, despite £55 million coming out of the overall budget next year. Lewisham council launched Place/Ladywell, a temporary homes project that uses a much faster/cheaper method of construction.
Campbell Robb, chief executive of Shelter, said “sky high” rents are at the root of the problem. He said loss of shorthold tenancies, which have quadrupled since 2010, are now the single biggest cause of homelessness, adding: “It’s no surprise that so many people are turning to their council for help keeping a roof over their heads.”
John Healey, former shadow housing minister, said rather than dealing with the structural issue, the money being spent was equivalent to “sticking plasters” on the problem.
He added: “This is a red warning light for Theresa May. This analysis shows how short-term cuts to housing since 2010 are a false economy. She must now do things differently to turn around six years of failure on housing, starting by reversing funding cuts for affordable homes.”
Under government proposals, the total amount of benefits a household can receive will be lowered from £500 to as low as £257 next month. Rebecca Rennison, a Hackney councillor, said: “In Hackney, there are now just a handful of properties that you could afford on housing allowance. It’s national policies that are causing this crisis.”
Christine Whitehead, LSE’s emeritus professor of housing economics, said: “London boroughs have lost a lot of their long-term housing, and not only have they got these very large bills, but they are paying a large proportion of them.”
More than two million social housing properties have been sold to the private sector since 1980, according to government statistics.
Henry Gregg of the National Housing Federation said: “By allowing money allocated to shared ownership and Starter Homes to be used for building homes to rent, the Government can set housing associations free to boost supply – and take people out of expensive temporary housing and into secure and affordable homes.”
Amanda Dunn: life in emergency accomodationPETER YEUNG/THE TIMES
Amanda Dunn, 48, who was made redundant from her job at Luton airport because of depression linked to homelessness, moved into a hotel with her 12-year-old twin girls in February. Luton council said it could be a decade before she is offered social housing.
“The mental health side of it is affecting us all,” Ms Dunn said, revealing the accommodation does not have a fridge or cooking facilities and prohibits food in rooms. “We used to do things at the weekend as a family, we used to go places. We used to laugh, we used to joke, we used to have fun.”
A spokesman for the Department for Communities and Local Government said: “The number of households in temporary accommodation in London is well below the 2004 peak, but we are clear councils must house families in settled accommodation as quickly as possible.”