Temporary accommodation costs soar as councils spend billions

Councils across England are spending £2.9 billion on temporary accommodation as homelessness costs rise.

Data released by the government reveals that the amount spent on temporary accommodation has increased by 4%, from £2.8bn the previous year.

The news comes as councils will now be required to inform schools and GP practices when a child is placed in temporary accommodation.

Councils spending billions on homelessness services

According to the data, 64% of the total spend (£1.9bn) was on nightly-paid accommodation, hostels and bed and breakfasts.

Over the last five years, the total spent by local authorities in England on housing and homelessness services has increased by 88%, from £1.6bn in 2020/21.

This brings the total spent on housing and homelessness services since 2020/21 to £13bn.

Matt Downie, chief executive at Crisis, said the government must unfreeze the Local Housing Allowance (LHA) rates to tackle the temporary accommodation crisis.

He said: “These new figures show how desperately we need a culture shift away from ruinously expensive temporary fixes for homelessness, towards an approach that prioritises stable, permanent homes.

“There has been a seismic shift in the way homelessness has been prioritised under this new government, and we want to see this momentum continued to secure long term changes where we prioritise ending homelessness not managing it.

“For far too long we have relied heavily on costly sticking plaster solutions, with councils now spending almost three billion pounds each year on temporary accommodation that only traps people in a cycle of insecurity. With sky-high rental costs and a chronic shortage of affordable homes, people across the country are being pushed to breaking point.

“To prevent homelessness rising further, the government must urgently unfreeze housing benefit so it reflects the true cost of private renting. With the right action, we can finally start to see this overreliance on temporary accommodation fall and ensure everyone has access to the vital foundation that is a secure home.”

Build more social housing

Shelter is urging the government to use next month’s Autumn Budget to commit to building more social housing.

Mairi MacRae, director of policy and campaigns at Shelter, said: “We have spent years treating the symptoms of the housing emergency, without addressing its cause. Without enough social homes, we’re throwing money at private companies to provide cramped and often grim temporary accommodation, which gets us no closer to ending homelessness.

“Councils once built the majority of social rent homes in this country. It is completely senseless that in today’s world they are forced to waste billions on temporary accommodation instead and are held back from building the social homes that would end the housing emergency.

“The government must use the Autumn Budget to get councils building again and prevent families from being wrenched from their communities and stuck in damaging temporary accommodation. It should remove the historic housing debt that is blocking councils from building social rent homes and immediately unfreeze housing benefit so families can afford a privately rented home in the meantime.”