Claiming Enhanced Housing Benefit for Intensive Housing Management

Context

I was recently rereading a Briefing on enhanced Housing Benefit and Intensive Housing Management (also known as enhanced housing management and/or additional housing management), that I wrote in 2010. I was struck by how relevant and important the information in that Briefing remains today.

Enhanced Housing Benefit is payable to providers of most types of supported and sheltered housing, provided they comply with the Exempt Accommodation rules. If you’re not sure whether your organisation qualifies please ask.

Please be aware that we do not non-local authority approved supported housing providers to claim Enhanced Housing Benefit for reasons set out in Thea Raisbeck’s “Exempt From Responsibility?” report. By “local authority approved” I mean supported housing providers that have commissioner consent to operate. Referrals from Homelessness/Housing Options Teams do not constitute commissioner consent in this context.

The reason that Enhanced Housing Benefit is payable is because qualifying supported housing providers provide additional and more intensive housing management and maintenance services than would be the case in general needs rented housing. They do so because supported housing residents have additional housing needs and supported housing itself has additional maintenance and services costs.

What Are Enhanced Housing Benefit & Intensive Housing Management?

There is no definitive list of Intensive Housing Management tasks (but see my blog post here). We have developed one based on the notion that Housing Benefit will fund tasks which are part and parcel of adequate accommodation, bearing in mind the needs of the residents, and provided these tasks are not funded elsewhere.

Many of these tasks routinely constitute much of a Support Worker or a Scheme Manager’s job description. Housing management functions such as lettings, assistance with claiming Housing Benefit to ensure that rent and service charges are paid, controlling access and facilitating and monitoring site visits from contractors and other visitors/professionals, arranging aids and adaptations, health and safety and risk assessments of property, management, administration, delivery and facilitation of housing services provided, the additional maintenance and services costs……I could go on.

If you are a non-profit provider of accommodation and support and the Intensive Housing Management tasks you perform aren’t funded by another revenue stream, then it can be funded by Housing Benefit. Even better, if you’re a registered provider of social housing (RP) and you provide supported or sheltered accommodation, in which you charge Intensive Housing Management as an eligible service charge, the local authority receives full reimbursement from the DWP in subsidy recovery. This means you’re actually bringing in money to the local area.

This subsidy top-up doesn’t fully apply where non-RPs go down this route. 40% of the difference between what you claim and the Rent Officer determination, which will be similar to the relevant Local Housing Allowance, goes onto the Council Tax bill or is picked up within another local authority budget, such as Adult Social Care. In order to provide a solution to subsidy loss to local authorities I set up the Exempt Accommodation Project in June 2021.

Why You Should Consider Enhanced Housing Benefit & Intensive Housing Management

It’s a very attractive proposition for RPs and other non-profit accommodation-based support providers for a variety of reasons.

You get full cost recovery on your housing costs which have often been underfunded for years. OK, RPs have an issue with compliance with the Regulator for Social Housing’s Rent Standard (unless it’s “Specialised Supported Housing”). But that isn’t a problem: Intensive Housing Management costs can be treated as service charge items. You can re-allocate costs and budget headings from rent to housing services where feasible in supported and sheltered housing arrangements.

This enables you to invest in the properties in which people with additional needs live: the physical environment, services and staff. Your support costs can be cheaper because you’ve remodelled your service delivery structure and/or taken some costs out and allocated them (where eligible) to Intensive Housing Management, funded through Housing Benefit. This matters when you bid for support/care contracts because your unit cost for support will be lower without actually reducing your revenue – you’ve just spread the cost.

The Current & Future of Enhanced Housing Benefit & Intensive Housing Management

Having worked with Enhanced Housing Benefit since 2005 you get used to hearing people say, “but it has to end sometime”. Well it hasn’t yet and one of its distinguishing features is its longevity and the fact that case law precedent has established that Intensive Housing Management is eligible for Housing Benefit, having regard to the nature of the accommodation type and personal circumstances of the tenant group.

Over time the Enhanced Housing Benefit pot has grown. Initially, this was directly in response to the retrenchment of “Supporting People”. We advised providers (and not a few local authorities) on reallocating the eligible proportion of their Supporting People revenue loss into Enhanced Housing Benefit. Over time this has become a well-worn path, supported as it is by regulation and case law.

Commissioners/funders will routinely ask supported housing providers looking for funding “have you reallocated your eligible costs into Enhanced Housing Benefit?” because it makes absolutely no sense not to do so.

Providers might want to consider revising service delivery models if this adds value to the lives of people with additional needs. For example, we are often told “well we would provide more services because people need them, but we don’t have the funding”. One of the things we do is to review service models and staff job descriptions in order to introduce Housing Benefit-eligible services such as concierge, access control or night security, for example.

If you’re a qualifying supported or sheltered housing provider (i.e. most social/non-profit providers of supported housing) and you haven’t gone down this route, or you haven’t done so for a while, you really should think about it and get in touch.

Even with the introduction of Universal Credit Enhanced Housing Benefit remains payable in respect of supported housing tenants. This is despite the fact that Housing Benefit was one of the benefits absorbed by Universal Credit and would not otherwise exist. When someone claims Universal Credit, the online application asks the claimant whether they live in supported housing. If they answer “yes” to that question the housing component of their Universal Credit is administered by the LA on an uncapped basis under the Exempt Accommodation rules. This also gives supported housing residents protection from the Benefit Cap, and in some cases from the Spare Room Subsidy/Bedroom Tax.

The “but it has to end sometime” mantra is true of course; it’s just been overly pessimistic for years. It’s likely that the time for change will come when the UK Government finally decides on the funding model for supported housing (in England). Specifically, whether a  transitional arrangement of paying Enhanced Housing Benefit for supported housing via Universal Credit be formalised as a permanent arrangement. The UK Government did eventually commit to keeping the funding of supported housing within the welfare system after all.

Health and social care are devolved functions within the UK, and supported housing would be were it not for the fact that a proportion of its funding, in the form of (Enhanced) Housing Benefit, remains non-devolved. If the UK Government takes a sensible view of supported housing, and not just its funding, it’ll see it as an integrated part of the health and social care system in England going forward. At the point of change, whatever and whenever that is, it may be that Enhanced Housing Benefit will become a component of Universal Credit.

What happens in NI, Scotland and Wales depends on whether those nations have a fully devolved welfare system (easy to see in Scotland) and whether they choose to (part) fund supported housing from within it or choose to put the funding within health and social care commissioning structures.

Why You Should Think About It

Our message is that you should consider now whether you’re properly recovering the costs of providing the supported housing services that your residents need, or whether you should consider reviewing your service delivery model to enhance revenue recovery. Not just the costs of human (staff) services, but the additional costs you incur in maintaining and servicing your supported and sheltered housing.

Supported housing providers are rightly asked to demonstrate the value that they deliver. They should be equally concerned to identify the costs they incur in delivering that value.

The best way to do so is to ask us to audit what you do and to calculate what it that translates into as a full-cost recovery rent structure. If the amounts are more than you currently charge, then please let us negotiate with Housing Benefit colleagues on your behalf to redress the imbalance.

The good news is that it won’t cost you anything if we find that you can’t claim Enhanced Housing Benefit. If we find that you can, and we successfully negotiate an increase, then you pay a small fee (charged to HB) per tenant per week. You only pay this when you’re in receipt of the increased revenue and you pay it over a 12-month period to aid cash flow. If we don’t get you an increase, you don’t pay us anything at all. Contact us.

There is an evident danger in not demonstrating your true costs, or revisiting your service delivery model, whether to appear “reasonable/competitive” to funders or for some other reason.

That danger may manifest itself if we have a funding system change at the point of which supported housing providers’ costs are frozen. If you haven’t optimised your rent and services charges income, the new system may assume you can make do with what you have.

Michael Patterson has worked on Enhanced Housing Benefit, Intensive Housing Management and other things since 2005. Michael writes, publishes and speaks on supported housing and related matters and provides strategic advice a range of supported housing providers and revenue and capital funders.

If you’re interested in Enhanced Housing Benefit please get in touch.