Hackney tells MPs: ‘Let us build homes, not hostels’
Councils must be allowed to build a new generation of social housing to stem the rise in homelessness, the Mayor of Hackney has told MPs.
Giving evidence to the Public Accounts Committee Inquiry into Homeless Households, Philip Glanville said that the huge rise of families forced into homelessness because of eviction by a private landlord was due to housing benefits not keeping up with record rents.
In 2011, the Government removed the link between Local Housing Allowance – a type of housing benefit people living in privately rented homes can claim – and market rents, meaning the allowance rarely covers rents levels in Hackney.
Eviction from the private rented sector is now the number one reason residents approach the Council for help with homelessness. Only 3% of these homes are affordable to families relying on Local Housing Allowance.
Since the welfare reforms we’ve seen rents go up 47% in a borough like Hackney, but the amount of funding available for residents to support that rent rise has only gone up 2%.
The delinking of Local Housing Allowance rates from local rents, and the cap on that, has had a massive impact.
We’ve seen the number of people exiting the private rented sector and becoming homeless was 7% of our cases in 2006/7 – that’s now 30% last year.
We’re seeing a dual effect of welfare reform and an unregulated private rented sector driving people into homelessness, and local government having to pick up the strain. More people are coming through our door because there simply isn’t anything else affordable.
Nearly 13,000 families are on the Council’s housing waiting list, with around 3,000 of those in temporary accommodation such as hostels and bed and breakfasts.
The Council’s own housebuilding programmes will deliver nearly 4,000 homes during the next few years – with more than half for social rent and shared ownership – but government restrictions mean the Council cannot borrow money against future rents to expand its work to meet demand.
We shouldn’t be proud that we’re having to open new hostels, but to respond to the pressures we’re facing we are. Rather than investing in that quick fix we need a new development of social housing.
The only response is to invest in new social housing and reform in the private rented sector – anything else is just a sticking plaster on this crisis.
If we could build 2,000 homes we could save £100million in temporary accommodation costs. We’re ready to go now if we have those freedoms to build.
Watch the Mayor’s evidence from Monday's session in full [external link] or visit the the Council's housing demand webpage for more information.