Councils spend £2m per day on temporary accommodation

The Local Government Association (LGA), has called on the government to use the Spring Budget to free councils from borrowing limits hampering their ability to build new homes, citing that local authorities are forced to spend £2 million per day on providing temporary accommodation.

It warned that the number of affordable homes built in 2015/16 fell by 52 per cent and was the lowest number in 24 years with just 6,554 social rented homes being built in the same year.

In a statement, the LGA highlighted that a steady decline in affordable housing and squeezes on household incomes has seen the number of households places in temporary accommodation rise by 50 per cent since 2010.

Statistics show almost 75,000 households are currently living in temporary accommodation, including bed and breakfasts, hostels and private rented accommodation.

LGA analysis revealed councils have been forced to spend £2.6 billion to house people in temporary accommodation in the past three years.

The LGA has also called for a temporary lifting of the Local Housing Allowance freeze to help ensure the provision of accommodation for vulnerable families.

Lord Porter, LGA Chairman, said: "Funding pressures are combining with a lack of affordable housing and private sector rents rising above household incomes to increase homelessness. It is also leaving many councils struggling to find suitable accommodation for those in need, particularly those who are young, vulnerable, or with families. 

"With councils continuing to face huge financial pressures, it is unsustainable for them to have to spend £2 million a day to house vulnerable people at the sharp end of our housing crisis. Councils would much rather invest this scarce resource in building new affordable homes and preventing homelessness happening in the first place.

"A renaissance in housebuilding by councils and a plan to reduce the squeeze on household incomes are both needed if we are to stand any chance of solving our housing crisis, reducing homelessness and the use of temporary accommodation, and sustainably reducing the housing benefit bill.

"Communities across the country need a new deal with the Chancellor that gives councils the ability to borrow to invest in housing and to keep 100 per cent of the receipts from any homes they sell to replace them and reinvest in building more of the genuinely affordable home they desperately need."