29 Sep 2021

A council has reclaimed millions in benefits from landlords and tenants of exempt accommodation as part of a wide-ranging review of the supported housing sector.

Since April 2019, Birmingham City Council has reclaimed a total of £3.6m from the exempt accommodation sub-sector, which has recently come under scrutiny from both local authorities and the Regulator of Social Housing (RSH).

David Kinnair, head of benefits at Birmingham City Council, told councillors that the overpayments had occurred “not because of a lack of process, but because of inappropriate or fraudulently claimed housing benefit”.

The figure was revealed on Friday at a meeting of the council’s co-ordinating overview and scrutiny committee, which is currently undertaking an inquiry into exempt accommodation within Birmingham.

Exempt accommodation is the name given to a type of supported housing that is not subject to the usual rules restricting the amount of housing benefit an individual can receive.

Instead, providers of exempt accommodation can claim uncapped levels of housing benefit in exchange for providing support.

The level of support required is largely undefined, with the only rule being that the support must be above “minimal”.

Birmingham has been the epicentre of a rapid growth in exempt accommodation, with the number of claimants in the city doubling to 22,000 over the past three years.

Fears have been raised that some exempt providers are exploiting the benefit system in order to make a profit and that the accommodation some are providing is of poor quality and is exploitative of tenants.

Birmingham is one of five councils involved in a government-funded pilot aiming to improve standards within the exempt accommodation sector.

As part of this pilot, 431 exempt accommodation properties have been inspected since November 2020.

A slide that was presented by officers during Friday’s meeting appeared to indicate that these inspections had uncovered 1,120 Category 1 hazards and 650 Category 2 hazards.

Inside Housing has asked Birmingham City Council to confirm these figures.

A Category 1 hazard is a hazard that has “a serious and immediate risk to a person’s health and safety”, while Category 2 is less serious.

Types of hazards include damp and mould, fire safety issues, asbestos and excessive heat or cold.

Many exempt accommodation providers are housing associations, meaning they are regulated by the Regulator of Social Housing.

The National Housing Federation revealed plans last month to block or withdraw membership from exempt accommodation providers deemed to be in the sector for the wrong reasons.

A number of exempt accommodation providers in Birmingham have been found to be non-compliant by the regulator, while one provider named Green Park was stripped of its registered provider status earlier this year.

However, Kalvinder Kohli, service lead within adult social care at Birmingham City Council, told councillors on Friday that registered providers are being used by some as a “vehicle” through which to access housing benefit, with money then flowing to other profit-making third parties.

She said the root of the growth of exempt accommodation “can be traced back to disinvestment and deregulation”, drawing a line to the 2009 removal of the ringfence around the council’s Supporting People budget.

“This, coupled with the reduction in regulatory powers, resources and agencies, has arguably led to the residual sector being left to explore how best to meet the demand that was there and the demand that has grown since,” she said.

Of the 21,317 exempt accommodation properties identified by the council as part of its investigation, around 20,000 are not commissioned by the council.

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