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Cymorth Cymru: Time for a rethink

Welsh Government proposals to merge Supporting People with other grant funding pose a clear risk to homelessness and housing-related support, says Katie Dalton. There is a better alternative.

The housing-related support sector has experienced a great deal of uncertainty over the past two years, with several twists and u-turns in the UK Government’s plans for supported accommodation funding. This uncertainty has had a clear impact, with National Housing Federation research showing an 85 per cent decrease in planned development of supported housing in England. Until recently, there had been a sense that the impact in Wales was less severe, due to the continued existence of Supporting People (SP) funding.

Unlike in England, SP has had strong political backing from Welsh Government and opposition parties, with funding protected in recent years despite pressure on public finances. Politicians have recognised its life-changing (and often life-saving) impact and several studies show financial savings to public services such as health, social services and community safety. As a result, the ringfence around SP has been a key feature of Wales’ commitment to supporting vulnerable people. But this is now at risk.

On 1 October 2017 the Welsh Government and Plaid Cymru announced a budget deal which would protect SP funding at £124million for the next two years. However, this picture changed significantly just three weeks later.

On 24 October a Welsh Government letter stated that seven ‘pathfinder’ local authorities would have 100 per cent spending flexibility during 2018/19 across SP, Flying Start, Families First, Communities First Legacy and an employability grant. This came as a shock to providers and landlords, not to mention many SP managers and staff. The remaining local authorities would be given 15 per cent spending flexibility across the same grants. Our calculations concluded that over £50million of SP money would no longer be protected.

On the same day the Welsh Government published its detailed draft budget, showing the promised £124million for 2018/19… but £0 for 2019/20. The funding for SP had been moved to another budget line called Early Intervention: Prevention and Support, along with a number of other grant schemes. We were told that this would facilitate the merging of these grants, should ministers decide to do so. It began to look like SP had lost its ringfence and protection from cuts, as this new budget line appeared to be £13 million less than the combined grants in the previous year.

Since then, the number of grants involved in the Pathfinders has grown to ten, including the Homelessness Prevention Grant. We’ve attended a series of workshop meetings to develop guidance and outcomes but it has felt very rushed. We’ve been told that ministers have not made a decision yet, but it seems that officials are working towards a single, merged grant. We fear that this would dilute the focus on homelessness when it should be a major priority.

Ministers are due to make a decision in the autumn, after reflecting on evidence from the pathfinders. This timescale has baffled many people. The pathfinders will have only just begun when ministers make a critical decision, one which breaks a long-standing commitment to ring-fence SP and fundamentally changes funding for vulnerable people in Wales.

Political pressure has resulted in the pathfinder guidance stating that local authorities should not spend less than their SP allocation on SP services in 2018/19, unless they can be sure of delivering better outcomes. This, and the fact that many contracts run beyond this year, should provide some assurances for the next 12 months. However, the sector has significant concerns about the medium to long-term impact of removing the ringfence.

Although the circumstances are different, the evidence from across the border is terrifying. The Auditor General found an average spending reduction of 45 per cent between 2010/11 and 2014/15 after the ring-fence was removed in England. In some areas there were cuts of 80 per cent.

Most, if not all, of our members can tell you about community concerns and protests against the development of supported accommodation, including for young people, people fleeing domestic abuse and people with mental health problems. Removing the ringfence and merging SP with other non-housing grants places politically unpopular services in direct competition for funding against early years and family projects.

This poses a clear risk to homelessness and housing-related support and we wholeheartedly oppose the removal of the ringfence around these services.

However, we also recognise that the Welsh Government is serious about reducing the number of grants it manages. As a result, we have proposed an alternative solution that does exactly this – but also protects homelessness and housing-related support services.

We believe that there is a much more coherent case for merging SP with the Homelessness Prevention Grant and the funding for short-term supported housing, which is due to be devolved in 2020. This will reduce three funding streams into one, utilise existing SP local, regional and national governance and commissioning structures, and importantly maintains a clear focus on homelessness and housing.

The Welsh Government has always been proud of its record of protecting SP and delivering groundbreaking homelessness legislation. It would be a tragedy to take a decision that could derail this excellent work. We hope ministers take the time to consider the alternative we have outlined above and give the sector the assurances it needs to continue to provide life changing housing-related support to people in Wales.

Katie Dalton is director of Cymorth Cymru

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