Chartered Institute of Housing response to the consultation on Supported Housing Regulation

We’ve called on the government to conduct an urgent review of supported housing funding, including subsidy rules, and to commit to a comprehensive strategy encompassing rent policy, support costs, and capital investment. A clear funding pathway is essential to safeguard existing services and unlock the delivery of new supported homes.
  

We believe there is a strong case for reinstatement of a dedicated national funding stream for housing-related support services. This fund, modelled on the previous £1.6 billion investment, would stabilise current schemes and encourage new developments.  
 

In our view a minimum of 10% of new housing funds should be allocated for supported housing, with an additional 10% targeted at older persons’ housing, as recommended by the Older Persons’ Housing Taskforce. 

 

To drive more effective partnership working Integrated Care Systems, councils, housing associations and relevant organisations should be equipped to collaborate on data-driven local strategies that reflect the full scope of supported housing needs.  

Given the significant pressures facing council finances we argue that the financial impact of National Insurance increases on commissioned support services should be offset, preventing further erosion of vital services.

Such teams were named a ‘driving force’ in the success of the pilot programmes³  and named in 3.91 of the consultation document as expected of authorities when setting up new burdens funding. We recommend that these be in place for not only the licensing regime but for strategic work and needs planning outlined in part 1 of the Act.   

The benefits of this would be a full understanding of the supported housing supply, who is living in those homes and their support needs, what other bodies commissioned accommodation in their area (such as NHS and the police), and so needs to be involved in developing the strategy. This includes an understanding of existing referral pathways, and what provision is lacking, and the cost of that provision. Conducting the reviews prior to the implementation of licensing schemes will enable local authorities to establish the data and relationships necessary to achieve the desired outcomes. 

These strategies should reference and account for the needs laid out in related local authority work, such as local plans, homelessness strategies, domestic abuse strategies and older persons housing plans. These should be developed in collaboration and consultation with existing quality providers and be published so that there is a precedent for providers to evidence against when they submit documentation that they meet the local need standard (Q21-24) to satisfy licensing conditions. 

We welcome confirmation received from MHCLG⁴  during the consultation period that maintaining supply is of utmost importance to the department and there is no intention for the schemes to be ‘onerous or burdensome’ to providers. As such, we recommend prioritising those examples of poor provision, trying to hide profit-making and exploiting housing benefit whilst providing little to no support, in enforcement activity. Reviews should make it clear which providers are ‘providers of concern’⁵  and so, pursued for criminal penalties or where exempt accommodation is being used in cases where a lack of general needs supply has led to individuals being rehoused there and awarded higher housing benefit.

Protections must be put in place to those vulnerable to these practices, and at risk of eviction, threats or homelessness, due to stronger regulation. We recommend adequate recording and safeguarding of these cases, and the provision of suitable accommodation made for those residents whose providers are targeted. 

Question 5:

• Do you agree that the licensing regime that the government is proposing to introduce under powers in the Act should apply to all supported housing (supported exempt accommodation as defined in the Act)? This definition is the same as ‘specified accommodation’ in housing benefit regulations. 

Partly agree

CIH has argued that domestic abuse survivors should not be subject to the housing benefit cap (regardless of accommodation type).⁶  

National Supported Housing Standards

Question 6:

• Do the principles reflect the core elements of a good quality support service? 

Strongly agree

The principles echo those underpinning effective regulation across most sectors, and importantly the other regulatory regimes within which many supported housing providers already sit, including the Regulator of Social Housing (RSH), the Care Quality Commission (CQC), and Ofsted.

Care providers are required to make annual returns to CQC on their services, specifically any changes, and how they ensure that it is ‘safe, effective, caring, responsive and well-led.’

Both Osted and CQC are centralised systems that involve reporting at the service level. Guidance for local authorities must be clear on when and how this should be used to avoid duplication and provide a quicker process for the purpose of evidencing compliance with the national supported housing standards and granting licenses.

Question 7:

• Do you have suggestions for any additions to the principles as described above?

No

 

Question 8:

• Do you agree with the person-centred support standard?

Partly agree

 

Question 9:

• Do you agree with the examples of evidence that are listed? 

Partly agree

In line with comments made above as to the range of people and support needs that are met within supported housing, the evidence should similarly reflect both the type of support and housing available and the individual’s needs. For example, it may not always be appropriate to require move on policies but policies on how residents are encouraged to engage with social activities, additional care or health service involvement.  

Question 10:

• What other information (if any) could be provided to evidence this standard, including evidence that providers already submit to other bodies? Please specify what the information is currently used to evidence. 

Response

The RSH’s proactive consumer regulation requires landlords to be assured and give assurance of customer involvement in shaping services. Whilst this is at organisational rather than scheme/service level, in some cases, landlords will be able to drill down to local or scheme area to provide this. 

Question 11:

• Do you agree with the empowerment support standard? 

Strongly agree

 

Question 12

• Do you agree that providers should give residents an information pack when they move into their accommodation? 

Strongly agree

Readily available information on who to contact, in what circumstances and how, should be something made very clear for all residents and in some circumstances their next of kin/ carers, as well as clarity on levels of services and response times etc (for complaints, for repairs where managed separately to support etc.). Having multiple ways of communicating this information is important to ensure all residents can access such information quickly and easily as and when they need it, as well as at the outset of their tenancy/licence. 

Question 13

• Do you agree with the examples of evidence that are listed? 

Agree

 

Question 14

• What other information (if any) could be provided to evidence this standard, including evidence that providers already submit to other bodies. Please specify what the information is currently used to evidence. 

No Response

 

Question 15

• Do you agree with the environment support standard? 

Partly agree

Supported housing should provide a safe and homely environment to support people to live well, and the environment support standard should give assurance of this. The term therapeutic, whilst applicable in some schemes for some residents, would not be universally appropriate, and therefore would not be helpful for this standard. It is something to be considered where appropriate for individual support planning.

This standard should look at how the wider environment of community/neighbourhood is assessed as appropriate for the nature of the supported housing and people it supports (beyond the local need standard) and how the provider engages with partners in the locality to ensure the safety and wellbeing of residents. This may mirror some of the measures in the neighbourhood and community standard set by the RSH’s consumer standards, including connection to and involvement with community safety partnerships. It is important to ensure swift action in relation to anti-social behaviour (against the scheme and its residents as well as any anti-social behaviour (ASB) by residents) to tackle the stigma that often is attached to supported housing. 

Question 16

• Do you agree with the examples of evidence that are listed in relation to the environment standard?

Partly agree

In light of comments above, ASB and hate crime policies, and neighbourhood risk assessments would be appropriate in this standard. Clarity is needed regarding photographic evidence of accommodation; if this is to be at every letting, this would be an onerous requirement, particularly for those schemes that are for short term support.

Question 17

• What other information (if any) could be provided to evidence this standard, including evidence that providers already submit to other bodies. Please specify what the information is currently used to evidence.

Response

The RSH requires providers to report on properties that meet/fail the current Decent Homes Standard, and on certain health and safety requirements (gas safety, fire safety etc.).

Question 18

• Do you agree with the staff and safeguarding support standard?

Partly agree

Appropriate checks for staff are required but the standard may need greater clarity on which staff and at what level these are needed.

In the context of consumer standards for social housing providers, mandatory qualifications will be required at senior levels within organisations. The requirement in this standard should clarify if these will contribute at all to compliance with this standard. Also, if any more direction on training or qualifications for staff in direct contact with residents is required, how flexibly this can be applied at the scheme level, and how this will be applied consistently across local authorities in partnership with providers.

There should be clear recording of safeguarding reports and any further actions taken.

Question 19

• Do you agree with the examples of evidence that are listed in relation to the safeguarding standard? 

Agree

Arguably whistleblowing policies also fit with compliance on this standard.

Question 20

• What other information (if any) could be provided to evidence this standard, including evidence that providers already submit to other bodies. Please specify what the information is currently used to evidence.

Response

Evidence submitted to CQC on DBS checks, training and competency may be adequate to demonstrate compliance, particularly if there is no support provided in addition to care, as in some extra care services. 

Question 21

• Do you agree with the local need support standard? 

Partly agree

There are concerns that, without adequate guidance, the local need standard could be used to discourage certain types of provision based on political sensitivities. Presently, there is significant flux within the structure and leadership of local government, and any vagueness in what ‘local need’ is may facilitate attempts to exclude some cohorts in their area. We therefore recommend that the local need standard be officially linked to the data and evidence produced for and published in a local authority’s supported housing strategy. As outlined in our introduction, this would require mandated sequencing in how the act is implemented. Currently, there are debates in Westminster about how to adjust the standard method in the National Planning Policy Framework to assess for local need; if these become considered for reform, that methodology and resulting evidence should also be included to demonstrate local need.  

Additionally, we would argue that if a person is currently placed in exempt accommodation, it demonstrates their need for it. Even if that provision is poor, or even an example of the most problematic provision, it is of utmost importance that the provision is under review and not the individual’s need. The approach has precedence in the context of awarding of housing benefit, see Salford City Council v PF [2009] UKUT 150 (AAC).⁷ 

Question 22

• Do you agree with the examples of evidence that are listed in relation to the strategic need standard?

Partly disagree

We agree that the first element of evidence is appropriate. However, for the reasons explained above, we strongly support equipping providers and licencing authorities with supported housing reviews and strategies that evidence local need. 

In the consultation, document, point 2.23 describes the worth that supported housing strategies will have in relation to assessing local need. But the first line of the standard’s description dilutes its potential by stating ‘where it exists.’ suggesting that, in some cases, licensing will be administered without supported housing strategies in place. As such, we recommend deleting ‘where it exists’ from the local need standard:

• How the service fits into the local authority’s supported housing strategy, where it exists.

In point 2.25 we suggest amending the text to accommodate for the ‘small groups and specific cohorts’ described to read:

• Referral and assessment procedure including information on which local and national partners are involved and how the referral pathway operates if part of one.
  
  

Question 25

• Do you agree with the responsible person standard?

Partly disagree

There is need for clarity over the potential difference and/or overlap between the responsible person standard, the licensee and, where services are commissioned, the lead/named person responsible for meeting contractual obligations, and guidance to ensure consistent application across local licensing authorities.

The responsible person/licensee should be capable of ensuring standards and other requirements of the licence are met and have the appropriate authority and control across both accommodation and support to ensure this. In some cases, it will be the landlord, but in supported housing where managing agents undertake both housing management and support functions, it would be more appropriately held by a responsible person within that managing agent.

Where the support within a scheme is given by a separate support provider, commissioned by local authorities, but landlords retain housing management and repairs functions, the local authority should ensure compliance with the national supported housing standards through their contractual arrangements, rather than require the landlord to do so. In such cases, it should be possible for there to be a dual licence process, that involves both landlord and support provider, given the additional costs and risks involved for each party. This should be specified in guidance to ensure a consistent approach across local licensing authorities.

Question 26

• Do you agree with the examples of evidence that are listed in relation to the responsible person standard? 

Partly agree

The evidence required is very ‘broad brush’ and further criteria or examples may be helpful. In the licensing requirement of a fit and proper person, it may potentially rule out people with lived experience of supported housing then going onto qualify and work within the sector. Demonstrating the value of this approach and the risk assessments taken to enable people to take up such employment and positions would be helpful.

Question 27

• What other information (if any) could be provided to evidence this standard, including evidence that providers already submit to other bodies. Please specify what the information is currently used to evidence.

No Response

 

Question 28

• Do you agree with the statement of purpose support standard? 

Partly agree

It is reasonable for providers to be clear to residents, referral agencies and stakeholders as to the aims and purpose of the scheme and how they seek to support residents to achieve their goals. There are some concerns about stating the characteristics of people using the scheme as it may be seen as stigmatising, and exacerbate issues with the wider community and acceptance of the presence of supported housing schemes. It also potentially acts against a real person-centred approach, where people may require different approaches and have different priorities for support to meet their goals.

Question 29

• Do you agree with the types of evidence that are listed in relation to the statement of purpose standard?

Partly agree

With concerns about including the characteristics of residents, as above.

Question 30

• What other information (if any) could be provided to evidence this standard, including evidence that providers already submit to other bodies. Please specify what the information is currently used to evidence. 

Response

Similar statements of purpose are often set out in commissioning contracts or service level agreements. 

Question 31

• What criteria should a needs assessment include?

Response

Supported housing covers such a range of people and support needs, that it is difficult to prescribe this, although in many cases this will be set out in commission contracts or service level agreements where these exist. There are also likely to be requirements according to different commissioning contracts and referral pathways which will shape how needs assessments for individual residents are undertaken, as well as, in some cases, care plans (with or without support needs alongside these).

Question 32

• Do you agree with the suggested content of support plans? 

Partly agree

Support plans should be flexible to enable person centred support, helping residents to identify and work on their priorities within appropriate and agreed timeframes, and able to be responsive to issues as these arise. Being too prescriptive potentially would restrict support being truly person centred. There should be evidence of how the resident has been involved in the support planning process, what outcomes/objectives have been agreed, what actions will be taken to achieve these and the nature and level of support to enable this, and how this will be identified/measured as appropriate.

Question 33

• Are there any further criteria that a support plan should include? 

Response

Timescales for review of support plans, agreed with the resident.

 

The supported housing licensing regime

See also the answer to Q25 above.

Question 34

• What would the risks and benefits be with licensing authorities joining up to administer licensing across local areas authority boundaries? 

Benefits

Data sharing: For example, a database of rogue providers could be used to flag concerns where they attempt new ventures.

Pooling resources: This could include programmes delivering training to providers that are found to be lacking in meeting the standards, but willing to cooperate and improve. 

Risks

Lack of consistency/patchwork provision: Too much flexibility in establishing licensing schemes and joint arrangements may create more favourable conditions in certain areas than in others. For example, a cross-boundary provider within a shared administration could be subject to easements, or discounts that a cross-boundary provider without such an agreement does not receive, putting them at a disadvantage. As such, clarity on how fees are set and administered is crucial.

Question 35

• Do you agree with the definition of a scheme? 

Partly disagree

Models of dispersed provision are prevalent in supported housing, whether serving survivors of domestic abuse, supporting those experiencing homelessness, or establishing single or shared long-term accommodation for those with lifelong disabilities, aiding them to live as independently as possible. To protect these providers, careful consideration of the consequences of the current definition of a scheme on these providers’ viability must be taken.  

Recommendations

• Allow dispersed schemes to register each property within a local authority in the same form as a ‘group’ to limit the administrative burden and duplication.
• Some providers may argue that each group should be charged as one license. However, this approach would disproportionately benefit larger providers and schemes and leave room for abuses of the environmental standard.
• Instead, there are options to band licensing fees so that additional schemes cost less than the first issued license. Further, more can be done to differentiate between the provision of a three-bedroom flat for one family as a single scheme, versus a forty-room hostel as one. This could be achieved by charging a small, nominal fee per bedspace for each bed over the measure of a ‘large HMO’ (over five unrelated residents). This approach is demonstrated in Brighton and Hove City Council Houses of Multiple Occupation (HMO) charges.⁸ 
  
  

Question 36

• Do you agree with the proposed licensing exemptions? 

Partly agree

Frequently schemes for younger adults include looked after children and care leavers under Ofsted’s regulation as well as those out of its remit. In these cases, a scheme would also require a supported housing licence. However, there are clear parallels between the standards set and aims of the two regulatory frameworks. We believe that there is a case to develop a framework that removes unnecessary duplication. For example, setting out how evidence suitable for one regulator such as Ofsted, can be shared with local authorities and any gaps identified to ensure only this additional information is required.

We believe that this approach would align with broader government aims in reducing adverse outcomes and homelessness known to disproportionately affect this cohort⁹.  Such as the  ’staying put’ arrangement¹⁰  and the local authority duty to support care leavers 25 years of age.

Question 37

• Do you agree with the fit and proper person test proposed and who it would apply to? 

Neither agree nor disagree

Many supported housing schemes encourage peer support and mentoring including employment in schemes where appropriate. As currently framed, the test would exclude people from this function. This is a positive approach in parts of the supported sector, which could be supported by developing an appropriate risk assessment agreed with licensing authority and the provider, to enable people with lived experience, skills and qualification to undertake the role, where appropriate.

Question 38

• Do you agree that supported housing schemes must meet the relevant accommodation requirements and standards to get a supported housing licence? 

Strongly agree

 

Question 39

• Do you agree that if enforcement action is being taken under the Housing Act 2004 due to the presence of Category 1 health and safety hazards, or there are other issues of concern relating to accommodation quality at the scheme, a licence should not be granted? 

Partly agree

There should be an emphasis on working with the provider to establish an action plan to improve to regain the licence, given the need that exists for more supported housing.

Question 40

• Which factors could mean that accommodation is unsuitable to be supported housing for the purposes of this licensing condition? 

Neither agree nor disagree

The problems outlined in paragraph 3.30 of the consultation document are comparable and related (but by no means limited) to the ongoing issues regarding the poor accommodation having been provided throughout England via permitted development rights (PDR). In 2023, we raised our concerns¹¹  about the large number of unsuitable PDR accommodation being funded through exempt accommodation, as well as highlighting broad and continuing concerns where it is used in the private rented sector (PRS) and as temporary accommodation (TA).

Under the above question’s proposal that a scheme “demonstrate appropriate planning permission,” these units are entirely out of scope as they were not subject to a requirement to obtain full planning consent in the first place. Currently, the government holds no data on how many units were created under PDR and claim exempt accommodation rates. As such, we recommend that the government collect this data to evidence where residents with support needs are being accommodated in units created via PDR, and when such units were created to determine the impact that such planning deregulation has had on facilitating rogue provision. 

At CIH we have repeatedly raised the alarm about the unsuitable and unsafe housing created under PDR¹².  The tightening of these rules has been consistently and noticeably absent from the new government’s reforms to the planning system. A failure to address PDR or to collect accurate data on the dwellings arising from these conversions will hinder every local authority’s ability to determine quality housing that aligns with its local plan, homelessness strategy and supported housing strategy.
 

Question 41

• Do you agree that the scheme should demonstrate that it holds the appropriate planning permission to demonstrate compliance with this licensing condition?

Partly agree

As mentioned above, relevant planning permissions will not be a catch-all to identify problematic schemes. Our recommendation would be broadening the data that local authorities hold, to assess what planning permissions, or lack thereof, are indicated in problematic provision by amending the phrasing of the above for providers to include any of the planning permissions that a scheme currently holds. This evidence then could be used to determine whether the Secretary of State needs to consider a planning use class in the future (Q74-75), following a review of the impact of the licensing regime on managing problematic schemes.

Question 42

• Do you agree that each resident must have a needs assessment and support plan? 

Partly agree

Not in cases where care is delivered without additional support, when the care needs assessment and plan should be sufficient.

Question 43

• Do you agree that a scheme providing care (that meets the definition of regulated personal care) will only be granted a licence if the care service is registered by the Care Quality Commission? 

Strongly agree

 

Question 44

• Should the government prevent schemes where the care service has been rated as inadequate by the Care Quality Commission from getting a licence?

Partly agree

There should be a focus on an improvement plan within agreed timeframes to retain the licence.

Question 45

• Is the National Supported Housing Standards condition set out above, enforced as part of the licensing regime, likely to be an effective means of securing that the National Supported Housing Standards are met? 

Partly agree

CIH supports the licensing regime to enforce the National Supported Housing Standards. However, there are concerns in the sector over where the main responsibility lies to hold the licence, specifically where the landlord delivers its housing management functions, but there is a separate support provider often contracted by the local authority or other commission agency. This would entail significant risk unless there is a mechanism to hold both to account (through joint/split licensing, for example). See more in answer to Q25.

Question 46

• Do you agree that the local authorities should have discretion to treat support services commissioned by a public body (such as a local authority, National Health Service or UK government department) as complying with the National Supported Housing Standards? 

Partly agree

With the condition that the public bodies commissioning the service will incorporate those standards within its commissioning approach and contracts. Additionally, those commissioning public bodies have representation on the multi-disciplinary teams set up within the licensing authority, to ensure the necessary expertise across residents’/service users’ requirements. 

Question 47

• What discretionary conditions, if any, should licensing authorities be able to add to a licence application?

Response

We acknowledge that the proposed license scheme must have a limited and specific number of exemptions to fund itself. If the number of exemptions were to be extended, the burden of the licensing scheme's operating costs would fall upon smaller providers, threatening their viability and the sustainability of the regulatory regime’s capability to enforce standards itself. 

Some providers and bodies in their response to the consultation will suggest ‘passports’ or ‘easements’ for certain types of provision where well-established accreditation or standards already exist. We propose that the government undertakes to understand clearly the merit of these easements using an evidence-led approach whereby the characteristics of each type of provision and the administrative evidence required are mapped and held in secure, communicating data systems, to enable information sharing across regulatory regimes. This both limits the scope for duplication (and so, burdening the capacity of good provision) and opportunities to game the system to take advantage of loopholes.

For example, many of our members are professionals working at registered providers (RPs) of social housing. In discussion, these providers stress their exemplary services and concerns about the continued viability of that provision, and so that RPs should have discretionary conditions applied in licensing or be exempt altogether. However, as outlined by CIH in oral evidence on exempt accommodation in 2022¹³,  at the height of the scandal regarding provision, evidence showed that a majority of those rogue providers were registered providers, with non-social housing stock falling out of the consumer standards and regulation. 

Speaking to members in local authorities working in quality and assurance, this speaks to larger concerns of the multiple data points held by councils in siloed systems with an institutional lack of capacity and, in some cases, ambition to establish secure and effective data lakes. Following consideration of the evidence submitted through this consultation, government should provide clear guidance for local authorities on how appropriate evidence from other regulatory regimes might be accessed to limit duplication on the part of both local authorities and providers.

Recommendations for discretionary conditions related to the licensing regime itself: 

• If a scheme with the same provider has been approved for a license in the same authority.
• If a scheme with the same provider has been approved for a license in a different authority.
  
  

Question 48

• If you are a supported housing provider, do you already hold another property licence and will you need to hold a supported housing licence in the future? 

Not applicable

 

Question 49

• Do you agree that where a property licence is already in effect the provider should be treated as licensed for the purposes of supported housing licensing? This would only be for the remaining period of the existing property licence, until it is replaced with a supported housing licence. 

Partly agree

We agree with the intent to avoid unnecessary duplication for those providers whose properties are subject to other licensing requirements and give support providers and landlords adequate time to plan for who will be the license holder under these new regimes. Our concern with this approach is that if exploitative actors are currently operating under these schemes, they will continue to collect exempt accommodation rates while not meeting the supported housing standards, until such time as the existing licence expires.

Our prior recommendation that each local supported housing review is undertaken before the introduction of licensing would help to address this. Local authorities should be encouraged and given the power to identify and address problematic provision, regardless of whether the provider holds another property license or not.

Question 50

• In addition to a standardised licence application form that all local authorities would use, what else can the government do to ensure applications are as straightforward as possible for providers and licensing authorities to minimise unnecessary burdens on local authorities and applicants?

Response

• As above in Question 35, allowing dispersed provision to apply in one form, even if they are subject to additional fees, enabling the same evidence (apart from the address and potentially the environment standard) to be auto filled within said form.
• In Question 46 we suggested that all relevant commissioning bodies integrate the National Supported Housing Standards into their procurement processes and contracts to limit duplication. 
• Additionally, the improved data sharing practices described above in Question 49 would significantly reduce the administrative burden on local authorities.
  
  

Question 51

• What would the impact of licence fees be on your business, or for administrative purposes if you are a licensing authority?

Not applicable

 

Question 52

• Do you have any other comments on licensing fees?

Response

As outlined in Question 35, thought needs to be given to how universal licensing fees may disproportionately affect small, charity providers with limited incomes or reserves. Above we suggested fees could account for sizes and numbers of schemes. Additionally, the income of providers may be another way or additional way of determining proportionate licencing fees.

However, we present inverse concerns regarding universality in the case of local authorities. In this case, a lack of consistency and predictability in fees across boundaries and time (fee rises) could present a significant burden to providers. 

The cost of licensing needs to be thoughtfully set and proportional to protect supply of existing supported and specialist housing.

Question 53

• Do you agree that supported housing licences should be granted for five years, starting from the day the licence is formally issued by the licensing authority? 

Strongly agree

Supported housing licences demonstrate the suitability of a provider in providing support for five years. Where there is clear evidence of continued local need, funding and commissioning cycles should be adjusted to align with the licence.

Question 54

• Do you agree that local authorities should have the discretion to grant a supported housing licence without carrying out an inspection? 

Partly disagree

To establish a fair, consistent and transparent licensing regime, all providers should have the same expectation of inspection during their license period. However, whilst the regime is being established, priority should be given to inspect provision that has been flagged by a local authority’s supported housing review as problematic or in need of improvement, and local authorities are equipped to take this approach.

Question 55

• Do you agree that licensing authorities should inspect each scheme at least once in a licence period, or more frequently if required? 

Strongly agree

See above.

Question 56

• Do you agree that licensing authorities should agree an improvement plan for a scheme together with the licensee before any further enforcement action is taken? 

Strongly agree

Yes, given the risk of homelessness and disruption in the lives of residents should there be a risk of losing the licence, the licensee and licencing authority must work together, to agree and achieve the necessary improvements. Reports from our members working in local authorities are that, although some provision may be lacking (for example in terms of some safety standards or in how the support is organised and evidenced), providers are cooperative when asked to improve. These types of providers were grouped in the pilot evaluation as ‘misinformed’ and were encouraged to make changes using informal communication and formal legal powers with a decent rate of success. 

In cases of good faith providers, where local authorities have identified category 1 or category 2 hazards (under the Housing Health and Safety Rating System for the Decent Homes Standard), it may be more proportionate to issue ‘hazard awareness notices’ to avoid escalating to improvement notices. 

Question 57

• Do you agree that licensing authorities should be able issue improvement notices for a period of three months, except in the case of a serious failure, if the scheme has not improved after an improvement plan has been agreed and undertaken?  

Strongly agree

 

Question 58

• Do you agree that licensing authorities should have the ability to extend the improvement notice to a maximum of 6 months in exceptional circumstances?  

Strongly agree

The answers given for questions 57 and 58 have been made under the assumption that the department intends to protect and improve the majority of supply, and these new powers are tools to wield against uncooperative and exploitative actors.

Question 59

• Do you agree with the proposed circumstances in which a licence would need to be varied or revoked?  

Partly agree

In engagement with sector colleagues and our members, some communicated fear that their services may be at risk of having their license revoked if they cannot deliver improvements in time.

To alleviate those fears, we recommend that national guidance to local authorities be explicit that revoking a license is a last resort and pursued not only due to non-compliance but also non-cooperation and evidence of exploitative practices and profit-making.

 

Further comment on the consultation document

Paragraph 3.74 - Strongly agree

Changes to personnel are an inevitable part of the operation of any business. In some schemes, where personnel on existing property licenses have changed, our members report high fees and burdensome administration to change these details. This process should be affordable and easy; we would recommend that fees are kept low and that a standardised form is adopted. 

Paragraph 3.77 - Strongly agree

Where evidence of profit-making is found.

Question 60

• Do you agree that financial penalties should also be available as an alternative enforcement tool to prosecution and that equivalent provision should be provided for in the licensing regulations? 

Strongly agree

 

Question 61

• Do you agree that the financial penalties may be determined by the licensing authority, but must not be more than £30,000? 

Strongly agree

See answer to Question 60 above.

Question 62

• Do you agree that operating as a supported housing scheme without a licence in a licensing area should be an offence? 

Strongly agree

This is in line with the process for Houses in Multiple Occupation (HMO) licensing and local authorities have experience of working with landlords and using these tools. 

Question 63

• Do you agree with the penalties attached to this offence? 

Strongly agree

This is in line with action for HMO licencing. There should be a clear and appropriate escalation process in place.

Question 64

• Do you agree that a tenant living in supported housing where a licensing offence has been committed should be able to apply to a tribunal for a determination of rent? 

Partly disagree

This places the onus on the resident to take action, where they may feel particularly vulnerable and at risk with potential loss of accommodation. We have considered what action would be appropriate in more detail in our answer to question 90. If this was considered, there would need to be clear and easy to access support for the resident to take this action.

Question 65

• Do you agree with the proposed penalty outlined above in respect of non-compliance with licensing conditions? 

Strongly agree

In line with HMO licensing.

Question 66

• Do you agree with the proposed consequence outlined above in respect of non-compliance with an improvement notice? 

Strongly agree

In line with HMO licensing.

Question 67

• Should the government include any other consequences of compliance or non-compliance with the regulations or with conditions attached to licences in regulations? 

Response

It may be appropriate to consider other consequences following a review of the impact of the licensing scheme in operation.

Question 68

• Do you agree that if an offence is committed by a licensee who is a company or organisation and it was committed with the approval or connivance of an officer, or because the officer was negligent, both the officer and the organisation have committed the offence? 

Strongly agree

As already occurs for HMO licensing and in cases of social security offences

Question 69

• What other steps can local authorities take to ensure that decisions on compliance with National Supported Housing Standards and licensing applications are delivered consistently across England?

Response

We welcome the commitment to conduct and publish an impact assessment before licensing implementation. We have heard reports of inconsistent and overzealous enforcement, in the improvement programme. This included challenging vulnerable people’s housing benefit entitlement in their homes without notice or proof of exploitative practice and requiring burdensome evidence for claims from providers. We understand that the department is aware of these circumstances and urge that, prior to licensing being established, investigation and assessment of these instances be undertaken to inform the national guidance and describe best practice. 

Throughout this response we have emphasised the need for clear and direct national guidance for local authorities to support a greater consistency across expectations of providers. Having a central system for appeals would also be a useful mechanism to support that.

Some providers of older people’s housing which is not extra-care but lower-level retirement/sheltered schemes report inconsistent approaches from local authorities in classifying this as specialist supported accommodation. Given the requirements within the licensing regime for such schemes, it is important that there is guidance to ensure that local authorities involve providers in discussions on how these schemes should be addressed (particularly in the light of the move to pension credit and discrepancies on what are eligible charges).

 

Further comment on the consultation document

3.91

As mentioned in our introduction, we strongly support creating multidisciplinary teams to establish supported housing licensing teams. The expected bodies and departments that the teams should be comprised of should be included in the guidance.  These teams should be guided to include (but by no means limited to) housing support, housing solutions, homelessness, Department of Work and Pension (DWP), Domestic abuse specialist teams, commissioners (including those outside of the local authority), planning teams, HMO licensing teams, probation and local Integrated Care Boards (ICBs). 

3.92

Sequencing the roll-out nationally is an opportunity to create evidence-based easements, standardised forms, and referral pathways. For example, a national evaluation of the prevalence of specific business models which have been most likely to conduct fraud, to inform priorities for enforcement action at the local level. 

3.93

Strongly agree.

Question 70

• What additional ways do you think there may be for securing compliance with the National Supported Housing Standards, in addition to the licensing regime?

No Response

 

Question 71

• Do you agree that all providers should be treated as licensed (and still receive housing benefit) when the regulations come into force, until a licensing decision has been made? 

Strongly agree

 

Question 72

• How can providers be supported to prepare for supported housing licensing? 

Response

National guidance and involvement of sector bodies in support and sharing good practice.

Question 73

• How can licensing authorities be supported to prepare to run a supported housing licensing scheme?

Response

National guidance and involvement of sector bodies in support and sharing good practice.

 

Planning use class for supported housing

Questions 74 & 75

• Should the government consider introducing a supported housing planning use class and other planning measures to enable more effective regulation? 

Neither agree nor disagree

As outlined in the consultation document and the Act, the planning use class may be considered at any time after the licensing schemes are implemented. We recommend that the government allow three years to pass before considering and consulting again on the need to introduce a specific planning use class. At that time, an assessment of the impact of the licensing schemes across England in achieving the aims of the reforms (in eliminating fraudulent provision, improving supported housing standards and outcomes for residents) will inform whether further action is necessary. The appropriate enforcement of the ‘local need standard’ via licensing should serve to eliminate and limit the abuses outlined in 2.22 in the future. 

Some of our members working for supported housing providers have expressed concern about these proposals, specifying that certain planning committees may object to a particular project going forward because of the intended residents, particularly in relation to supported housing for some groups with very complex needs, due to perceived disruption or costs. This could lead to short fall in the much-needed supply of these homes. The government’s plans to introduce training for planning committees in the Planning and Infrastructure Bill could be an opportunity to address these biases and ensure that committees are educated on local needs, as evidenced via homelessness and supported housing strategies.

Additionally, in CIH’s submission to the 2024 NPPF consultation¹⁴  and Homes England’s call for feedback on the delivery of specialist and supported homes¹⁵,  we outlined several recommendations to bolster supported housing delivery within the planning system, which did not include the creation of a specific planning use class.

 

Part 2: Housing benefit changes (GB application)

When the problems about the worst kind of abuses exempt accommodation first emerged, CIH worked closely with our colleagues in Crisis to try and identify what was happening and to develop solutions to fix it. CIH gave written evidence to the Levelling Up Select Committee about our findings and on the strength of this we were invited to give oral evidence at two separate inquiry hearings. The second hearing was a single session inquiry of pre-legislative scrutiny of what was to become the Supported Housing (Regulatory Oversight) Act 2023 (‘the 2023 Act’). We worked closely with Crisis and the lawyer Justin Bates, KC, who was commissioned to draft the Bill for Bob Blackman MP. The aim was to ensure the Bill was drawn widely enough to close the most blatant abuses that were taking place while minimising the impact on the vast majority providers who are acting in good faith and providing a much needed and valuable resource.

The 2023 Act fills in the legislative gaps that were being exploited by the bad faith actors. These gaps arose from the statutory exemptions in the separate regulatory systems for social and private housing. In certain situations, these exemptions overlapped so that some providers escaped regulation altogether or the powers available to the regulator were not wide enough or were ill suited to deal with the problem. These regulatory gaps are unique to the English legislation and have arisen almost entirely due to the distinction between non-profit and profit-making private registered providers – a distinction that does not exist in Scotland and Wales.  

The most blatant abuses exploit these overlapping exemptions, with the added financial incentive of a higher level of housing benefit being payable in ‘exempt accommodation’ where the eligible rent is often well above the median market rent. It is this overlapping of regulatory exemptions or exceptions within each system (HMO licensing, regulation of social housing and housing benefit) that is the cause of worst kinds of abuse as seen in places like Birmingham¹⁶.  

We do not believe that abuses are due to an inherently faulty housing benefit system, although it did boost the financial incentives to exploit the regulatory gaps. Rather these gaps have arisen because the regulatory systems for each sector were developed independently of each other without consideration about how they work as a whole. It is the resulting regulatory gaps that bad faith providers have ruthlessly exploited. In the worst cases these overlapping regulatory exemptions work as follows:

• Any registered charity, registered company or limited liability partnership can register with the Regulator of Social Housing (RSH) as a non-profit registered provider if it has at least one dwelling of ‘social housing’.¹⁷
• A dwelling is ‘social housing’ if it let a sub-market rent. Only social housing falls within the RSH’s consumer standards and is subject to rent controls through the rent standard.¹⁸  
• A body that is registered as a non-profit registered provider can also let property which is not social housing (i.e. let at a market rent) although all of its business activities (market and sub-market rent) fall within the RSH’s economic standards
• All non-profit registered providers’ properties (social housing and market rent) are exempt from HMO licensing and selective licensing.¹⁹
• Housing benefit covers above mid-market rents in supported exempt accommodation. 

The result is a body that is registered as non-profit registered provider (i.e. has at least one unit of social housing) and can let HMO style properties without a licence at above average market rents, which if let as supported housing (i.e. exempt accommodation) will have the rent covered by housing benefit. The only effective powers available to the local authority are using its Housing Act 2004 part 1 powers (i.e. category 1 or category 2 hazards) and scrutiny of the housing benefit award. Likewise, the RSH can only intervene if the registered provider is in breach of one of its economic standards (i.e. if it is not financially viable). The largest returns can be made in HMO style properties where a non-profit registered provider can undercut bona fide licensed private landlords.

Question 76

• Do you agree with the broad principle of aligning payment of housing benefit or any future housing support to licensing? 

See our answer below at question 86

Question 77

• For England, we are proposing using the definition of personal care as per the Health and Social Care Act 2008 (Regulated Activities) Regulations 2014/2936 to define care in housing benefit regulations. Do you agree? 

Strongly disagree

We disagree with these proposals to redefine care, support and supervision as we are not sure what they are designed to achieve, and they are likely to result in a loss of provision in ways that are difficult to predict.

Regarding the proposal to define care, there is no doubt that anyone who receives care at this level would require it. But licensing under the Act can extend to any level of care since it mirrors the existing definition in the housing benefit legislation. If housing and support standards are adequately dealt with through the licensing regime then they do not need also to be also regulated through housing benefit. All it achieves is an in unnecessary expansion in bureaucracy associated with the claim that that did not exist before. Either licensing is an effective means to raise standards, or it is not. If licensing cannot raise standards attempting to do it through the proxy of housing benefit is even less likely to succeed.

For similar reasons, we are opposed to removing the reference to supervision in the definition of what qualifies as supported housing. There will be instances where the claimant requires supported housing based on the totality of their needs. The concept of supervision already has a meaning that is well established and understood from within the wider benefits system.

We understand the concern to achieve value for money but there is a good reason why we do not use housing benefit to raise property standards for other types of housing where quality is known to be an issue (e.g. houses in multiple occupation). Existing licensing enforcement measures such as rent repayment orders (in Scotland and Wales, a rent suspension order or a rent stop order²⁰) that have been proven to work are the best way to influence standards through rents. 

We support the government’s aim to close the most blatant abuses and raise property and support standards among good faith providers. A key test of the success of these proposals is that it will not result in the loss of supply except in appropriate cases where a licence is revoked. We are aware that many good quality schemes are already at the very margins of financial viability particularly following the recent increase in employer National Insurance Contributions (NICs). The government should, as far as possible, seek to ensure that the losses to supply are restricted to cases where the provider has been unable to meet the licensing standards and that further losses due to increased provider costs from regulation are kept to a minimum.

We have been concerned by feedback from providers that unreasonable (and in some cases unlawful) requests for information from housing benefit departments before any changes in the law have been made are putting the viability of some schemes at risk and that are making some consider pulling out of the sector altogether. We fear that unnecessary duplication of regulation through housing benefit on top of licensing and hasty rule changes before the effectiveness of licensing has been tested will result in much good quality provision being lost. This will include schemes where the support provided helps meet wider government objectives such as helping those who are currently unable to work back into the labour market.

For this reason, there needs to be a range of provision which includes schemes with relatively low levels of support, not just those with high care needs. People who require care, support, or supervision do not always fall into clear categories. Many of those who reasonably require and would benefit from services may only meet the threshold through a combination of one or more of care, support or supervision. Disregarding any one kind that does not meet an arbitrary threshold (such as any care that falls short of CQC regulation), is likely to mean that individuals with relatively low support needs who are not quite tenancy ready, will no longer qualify, with the result that their future employment prospects are seriously damaged.

We have spoken to numerous sector representatives and trade bodies that support these kinds of client who believe that this kind of provision (which is often non-commissioned) could be at risk if the qualifying conditions are changed. This client group includes the former street homeless, ex-offenders, people who have former substance misuse problems and former members of HM armed forces. If these changes are made, it seems likely that some schemes and individuals who currently receive support may be excluded in ways that are completely unintended and almost impossible to predict.

We appreciate that the motivation behind the drive to have precise definitions for care, support and supervision has arisen from the fact that left unregulated landlords/providers have been claiming higher levels of housing benefit for only small levels of support which is of dubious quality. But the point is that they were only able to do so because the regulatory exemptions meant that there was no effective means to enforce compliance.

Once licensing is place, provided the requirement to have a licence is a qualifying condition to access the higher level of housing benefit regulatory evasion will be impossible. The imperative to codify care, support and supervision seems to be based in the assumption of continuing inadequate regulation.

The fact that some housing benefit determinations will remain difficult matters of judgement is not of itself a good enough reason for setting out rigid definitions or to justify rule changes that make it easier to refuse support. All administrative functions (for example, homelessness) involve difficult decisions about cases where the individual facts are marginal. What matters is that the right outcomes are achieved. Where disputes arise in marginal cases the proper place for resolving them is through the tribunals and courts.
  
Redefining entitlement does not necessarily eliminate the need for difficult judgements, it may (depending on the criteria) just move the boundary as to which clients are marginal in ways that are unpredictable. The inevitable outcome of re-defining care, support and supervision is that fewer claimants will qualify. The proposals to redefine care, support and supervision is not accompanied by an impact assessment that estimates the number of individuals affected, how they are likely to be affected (such as whether they will be capable of sustaining independently) and the effect on supply.

Question 78

• For England, personal care is defined in the Health and Social Care Act 2008 (Regulated Activities) Regulations 2014/2936. Is this definition of personal care sufficient to define the care provided in supported housing (in England) within housing benefit regulations?

See above response to question 77

 

Question 79

• Do you agree that we should link a definition of care in housing benefit regulations to existing legislative definitions of care and frameworks for the regulation of care in Scotland and Wales where possible? 

See below response to question 92

 

Question 80

• For Scotland and Wales, will a reference to the respective legislative definition of care be enough to cover all care delivered in supported housing which may be classed as specified accommodation in Housing benefit regulations? Do you agree?

See below response to question 92

 

Question 81

• What would you define as ‘support’ and ‘supervision’ for the purposes of Housing benefit?

See above response to question 77

 

Question 82

• Do you agree that a definition of support in Housing benefit regulations could include supervision? 

See above response to question 77

 

Question 83

• Do you agree that we should also link any definition for support and supervision to the National Supported Housing Standards for England, the Health and Social Care Standards in Scotland and relevant regulations in Wales? 

See below response to question 92

 

Question 84

• What level of care, support or supervision provision do you think is reasonable to be eligible for housing benefit under specified accommodation rules? 

See below response to question 85

 

Question 85

• When assessing a housing benefit claim under specified accommodation rules, what is reasonable in terms of evidence which a local authority could request when assessing a housing benefit claim under any definition or threshold of care, support, or supervision?

Response

Once licensing is in place, it should be reasonable to assume that there is a need for support for all services commissioned by the local authority social care department and other statutory services such as probation. It will also be reasonable to assume that tenants of registered providers that are complying with the national supported housing standards have a need for the support, unless the local authority has evidence to the contrary.

Most registered providers, or referral pathways of which they are part, will already have entry requirements for supported housing and it is reasonable to assume that these are being applied and are sufficiently rigorous if the landlord is meeting the national standards. Claimants will continue to be responsible for their own claim and to make a declaration and it is reasonable to ask the landlord and/or the support provider to verify these aspects of the claim in a similar way as at present for trusted partner status in universal credit. If landlords abuse this trusted partner status for housing benefit, it could be withdrawn and alternative verification requested.

Question 86

• The government intends to link the eligibility of housing benefit in England to licensing so that residents must be living in licensed supported housing to receive housing benefit under the specified accommodation rules. 

Partly agree

We agree with the broad principle of aligning payment of housing benefit (HB) to support licensing to the extent that it is implemented through the proposals outlined in Question 86 by linking the payment of housing benefit at the higher rate to the requirement to have a licence. Any provider who is not licenced under a ‘relevant scheme’ would instead only qualify for the rate appropriate to that kind of provider for general needs accommodation (e.g. the maximum rent (social sector), local housing allowance, maximum rent). See the Annex for proposed draft regulations as to how this might work. 

The linking of standards should be done through the requirement to have a licence. The National Supported Housing Standards are part of the licence conditions and as such, if the landlord/licence holder doesn’t comply with them, their licence can be revoked. This is also true of any other national licensing scheme such as HMO licensing in Scotland. We accept that some changes may be required with respect to supported housing licence, because unlike other forms of property licensing the licence holder may not be the same as the landlord or letting agent.

We do not support proposals that go further than this. For example, excluding from entitlement to help with housing costs altogether (whether universal credit, housing benefit or pension credit) or which change or modify the existing conditions for the higher rates of benefit that are currently allowed. We cannot support proposals that would lead to a loss of supply from bona fide providers in ways that are unpredictable.

We believe that linking entitlement to licensing in the way that we propose will be sufficient to stop the abuses. We think that this should be tried before any further changes are made. The 2023 Act already commits the government to carry out a review of the effectiveness of licensing before it implements the planning use powers and this would be an appropriate stage to consider if further changes are required. 

However, we would support proposals that would extend the principle outlined above to other kinds of national licensing and registration schemes that are set up to regulate standards of housing and support (or both). These may be existing national schemes (such as HMO or selective licensing), the proposed supported housing licensing in England or other schemes introduced by the UK or devolved administrations at some later date. 

We are concerned that although the supported housing licensing scheme is likely to be effective, there are some gaps in the existing regulatory regime for general needs housing that may become the focus for new kinds of abuse if they are not closed down.

Question 87

• What risks or issues should DWP consider when linking housing benefit eligibility in England to licensing? 

Response

We think the risks can be minimised if it is done in the way that we have proposed (linking entitlement to having an appropriate national licence if that is a national requirement. However, there may some procedural issues and administrative processes that require some working through. For example, what happens when someone makes a new claim who lives in supported housing if the landlord has or does not have the appropriate licence? Or if the claimant has an existing claim and their landlord’s licence is revoked?

The process should work smoothly so that the claimant does not get pushed back and forth between universal credit and housing benefit with neither taking responsibility for the claim. It may be appropriate for all unlicensed premises to remain within housing benefit for the time being until the matter has been finally determined (e.g. if a license is revoked but the license holder appeals). This would allow the local authority to coordinate its enforcement activities more effectively. 

Consideration should be given as to whether all claims for help with housing costs for all kinds of administrative processes for determining whether a licence is required should as far as possible be automated. We suggest that this should be tied the unique property reference number (UPRN).   

Question 88

• For providers in England, if you had a licence refused and housing benefit stopped or was restricted for your residents, what action would you take? Would you consider continuing to operate as general needs accommodation? Would you consider closing?

Not applicable: for providers

 

Question 89

• For residents in England, if you had to move because your provider failed to obtain a licence, what help would you need with finding somewhere else to live and with moving?

Not applicable: for residents

 

Question 90

• For local authorities in England - what support could you offer to residents who may have to move out of their current accommodation if they lose entitlement to housing benefit and access to care, support or supervision because their provider fails to get a licence?

Response

Residents who do not have care, support or supervision needs may choose to remain in the accommodation but would have their housing benefit reassessed. Others may need to claim help with their housing costs through universal credit. Where a tenant chooses to remain in supported housing where a licensing offence has been committed, they may be able to apply to a tribunal for a determination of rent.

Where the provider has failed to get a licence, and the tenant is no longer entitled to the higher rate of housing benefit, we strongly support the proposal to allow the tenant to apply to the tribunal to get a determination of rent – see the Annex for suggested legislative amendments to the Renters’ Rights Bill. We are aware that in the worst cases of abuse landlords have used the shortfall between housing benefit and the tenant’s contractual liability to intimidate the tenant and to use as a negotiating tool with the local authority to try and extract concessions. 

However, putting the onus on the tenant to go to tribunal is not ideal. We would prefer that the government use its reserve powers to specify that the maximum rent the landlord can charge, including any ineligible service charges, is their eligible rent from the date their benefit is changed. Changes should also be made to the overpayment rules to make clear that any overpayment can be recovered from the landlord and that they are barred from recovering their loss by recharging the tenant (either as a rent or a non-rent debt). A similar rule already exists for housing benefit overpayments where the overpayment was caused by landlord’s fraud.²¹ 

Question 91

• For local authorities in England - if a licence is refused for a large scheme, would you be able to identify the housing benefit customers within the scheme that were affected by the decision? 

Not applicable: for local authorities

 

Question 92

• For stakeholders in Scotland and Wales - What risks do we need to mitigate against, in Scotland and Wales, if we link eligibility in England for housing benefit, under specified accommodation rules, to licensing? 

Response

We agree to the extent that failure to register or obtain a licence where one is required would exclude the provider from the higher level of housing benefit. We suggest that this could be easily achieved by linking entitlement to a “relevant national licensing or registration scheme”. This would make it very easy to adapt the housing benefit regulations as national regulatory systems develop and change in a way that supports devolved national policy.

The kinds of abuse deliberate large scale abuse that have occurred in England have not been apparent in Scotland and Wales. Even in the absence of national licensing being introduced in we believe that these kinds of abuse are unlikely to occur because the existing national laws that deal with HMO licensing and landlord registration (e.g. Rent Smart Wales) provide better protection than in England (see the section on gaps not covered below). Market rents in Scotland and Wales are also substantially lower than in most parts of England and so the financial incentives to exploit any gaps in regulation are much weaker. 

Even if these kinds of abuse do start to appear, the national governments could make use of their powers to limit rents²², even though the UK government has been reluctant to use these powers in England. A minor change to the housing benefit regulations to make clear that the maximum eligible rent cannot exceed the legal maximum rent²³  would be advisable to support their use if required. 

We are aware that the decision AG v South Ayrshire [2017] UKUT 11 (AAC)²⁴  will have caused some concern among Scottish councils. But we think that this can be easily rectified by making registration with Social Care and Social Work Improvement Scotland a condition for the higher rate of housing benefit in a similar way to that we suggest for England. 

We are concerned that the (UK) Department for Work and Pensions should not attempt to legislate through housing benefit for housing and social care standards which fall within the competence of the Scottish and Welsh Government. If the UK government wishes to make provision for these, it should do so using the appropriate procedure²⁵. The 2023 Act allows the DWP to make compliance with the proposed licensing scheme a condition of housing benefit entitlement, but this power only applies in England.²⁶  Given these limitations, we think it would be safer to link entitlement to any national requirements to obtain a licence from (or register with) the appropriate national regulator (or each regulator if more than one kind of licence or registration is required). 

Question 93

• For stakeholders in Scotland and Wales - As licensing is not being introduced in Scotland and Wales under the Act, would you wish to see entitlement to housing benefit under specified accommodation rules linked to the schemes referenced in paragraphs 2.9 and 2.10 or to any other regulatory scheme already in place? 

See above

 

Additional comments

Gaps in regulation not covered by this consultation

The 2023 Act closes most of the regulatory gaps that were being exploited by requiring all landlords (regardless of their status) who provide care, support or supervision to have a licence regardless of whether the tenants or residents are on housing benefit or not.
However, it still leaves one major loophole which needs to be closed to prevent it from becoming a new area of abuse. In England, a landlord can still set up as a non-profit registered provider with just one unit of social housing and let multi-occupied properties that are not supported housing. 

These fall outside of HMO licensing and consumer regulation and count as social rent properties for housing benefit and universal credit. The guidance on universal credit states that lettings that fall under the social rent rules should not normally be referred to the rent officer unless they are more than £50 per week (£216 per month) above the Local Housing Allowance (LHA) rate.  Even if these properties are let at shared accommodation LHA rate²⁷, the financial returns can still be substantial. Unlike licensed HMOs the only rules limiting occupancy is the overcrowding legislation.²⁸   

Most single person households are not affected by the benefit cap until the rent exceeds £829 per month (in London, £1013 per month) or are exempt from the cap if the receive a disability benefit. In many areas this means a bad faith actor could exploit this regulatory gap by registering as a non-profit provider and undercut a bona fide private landlord who is complying with HMO licensing.

This gap could be closed by only allowing dwellings of a non-profit registered provider that are social housing to be exempt from HMO licensing. See the Annex for suggested legislative changes to the Housing Act 2004 and the Renters’ Rights Bill.

This change would bring the law in England in line with Wales.²⁹  In Scotland, this kind of abuse cannot occur because registered social landlords are not exempt from HMO licensing.³⁰   

This, together with the fact that market rents are substantially lower in Wales and Scotland, means that these kinds of abuse in supported housing have not been apparent in Scotland and Wales and are unlikely to occur even in the absence of a national supported housing licensing scheme being set up.   

1. Save our supported housing open letter to PM and chancellor, April 2025 https://www.housing.org.uk/globalassets/files/supported-housing/save-our-supported-housing---letter-april-2025-2.pdf  
2. NHF/ Altair, Supported Housing in England: estimating need and costs to 2040, April 2024 https://www.housing.org.uk/globalassets/files/supported-housing/report---nhf-need-for-supported-housing.pdf 
3. DLUHC, Evaluation of the supported housing oversight pilots, April 2022 https://assets.publishing.service.gov.uk/media/62557c828fa8f54a922789ce/Evaluation_of_the_supported_housing_oversight_pilots.pdf 
4. Supported Housing Network meeting, April 2025: https://www.cih.org/recordings/ 
5. DLUHC, Evaluation of the supported housing oversight pilots, April 2022 https://assets.publishing.service.gov.uk/media/62557c828fa8f54a922789ce/Evaluation_of_the_supported_housing_oversight_pilots.pdf
6. CIH response to DLUHC consultation on local connection requirements for victims of domestic abuse, May 2022 https://www.cih.org/media/askedxym/cih-local-connection-da-consultation-response-may-2022.pdf 
7. Tribunals Judiciary Decision Summary Sept 2009 https://administrativeappeals.decisions.tribunals.gov.uk/Aspx/view.aspx?id=2741 
8. Brighton and Hove City Council https://www.brighton-hove.gov.uk/housing/private-housing/property-licensing-fees-discounts-and-exemptions 
9. House of Commons, Support for care leavers, November 2024 https://researchbriefings.files.parliament.uk/documents/CBP-8429/CBP-8429.pdf 
10. HMG, Staying Put, 2013 https://assets.publishing.service.gov.uk/media/5a7c505c40f0b6321db385b2/Staying_Put_Guidance.pdf 
11. CIH consultation response, September 2023 https://www.cih.org/media/ycqk1qi5/cih-response-additional-pdr-flexibilties-sep-2023.pdf
12. CIH response to consultation on NPPF reforms, September 2024 https://www.cih.org/media/flxbmlft/cih-response-to-the-nppf-planning-reforms-september-2024.pdf 
13. CIH oral evidence to Levelling up, Housing and Communities Inquiry on exempt accommodation, April 2022 https://committees.parliament.uk/oralevidence/10160/pdf/ 
14. CIH response to consultation on NPPF reforms, September 2024 https://www.cih.org/media/flxbmlft/cih-response-to-the-nppf-planning-reforms-september-2024.pdf 
15. CIH response to Homes England on delivery of specialist and supported homes, October 2024 https://www.cih.org/media/42dbwr04/cih-s-response-to-homes-england-s-call-for-feedback-on-the-delivery-of-specialist-and-supported-homes.pdf
16. Spring Housing, Exempt from responsibility? 2019 https://springhousing.org.uk/wp-content/uploads/2019/11/Spring-Housing-Final-Report-A4.pdf 
17. Housing and Regeneration Act 2008, sections 59, 79(1), 112 and 115 https://www.legislation.gov.uk/ukpga/2008/17/contents 
18. Housing and Regeneration Act 2008, sections 68(1), 69, 192-194 and 197 https://www.legislation.gov.uk/ukpga/2008/17/contents 
19. Housing Act 2004, section 79(3) and schedule 14 paragraphs 2(1)(aa) and 2A https://www.legislation.gov.uk/ukpga/2004/34/contents 
20. Housing (Scotland) Act 2006, section 144; Housing (Wales) Act 2014, section 30 https://www.legislation.gov.uk/asp/2006/1/contents and https://www.legislation.gov.uk/anaw/2014/7/contents 
21. Housing benefit Regulations 2006, regulation 107; The Social Security (Overpayments and Recovery) Regulations 2013, regulation 15 https://www.legislation.gov.uk/uksi/2006/213/contents and https://www.legislation.gov.uk/uksi/2013/384 
22. In Wales, see Landlord and Tenant act 1985, section 31 https://www.legislation.gov.uk/ukpga/1985/70/section/31#:~:text=31%20Reserve%20power%20to%20limit%20rents.&text=(b)restricting%20the%20amount%20of,any%20specified%20description%20of%20dwelling 
23. See alternative regulation 13(1) as used for exempt accommodation as set out in the Housing Benefit and Council Tax Benefit (Consequential Provisions) Regulations 2006, schedule 3 paragraph 5(2) https://www.legislation.gov.uk/uksi/2006/217/contents 
24. Upper Tribunal Administrative Appeals decision, 2017 https://www.gov.uk/administrative-appeals-tribunal-decisions/ag-v-south-ayrshire-council-2017-ukut-110-aac 
25. See, Scotland Act 1998, section 30; Government of Wales Act 2006, section 95, https://www.legislation.gov.uk/ukpga/1998/46/contents  and https://www.legislation.gov.uk/ukpga/2006/32/contents 
26. Supported Housing (Regulatory Oversight) Act 2023, sections 5(1)(e),(5)(b) and14. For the general power to exclude payments across Great Britain see Social Security Administration Act 1992, section 137(2)(i) https://www.legislation.gov.uk/ukpga/2023/26 
27. DWP, Advice for Decision Making: Staff Guide, para F3253 https://www.gov.uk/government/publications/advice-for-decision-making-staff-guide 
28. Housing Act 1985, sections 323-326; Housing (Scotland) Act 1987, sections 135-137 https://www.legislation.gov.uk/ukpga/1985/68/contents  and https://www.legislation.gov.uk/ukpga/1987/26/contents 
29. Housing Act 2004, schedule 14 paragraph 2(1)(aa),(b) https://www.legislation.gov.uk/ukpga/2004/34/schedule/14 
30. Housing (Scotland) Act 2006, https://www.legislation.gov.uk/asp/2006/1/contents 

Annex - proposed legislative amendments