Homelessness and rough sleeping in the time of COVID-19

What you need to know:

  • The ban on evictions and the furlough scheme have protected many ordinary households from the full economic impact of successive lockdowns. But move on for those already in temporary accommodation has been difficult and there is real concern about the projected growth in demand for temporary accommodation from households facing homelessness once the ban on evictions is lifted and unemployment rises later this year.
  • The courts will face major difficulties in coping with any significant increase in landlord claims. As a result, the time taken to get an order, let alone to gain possession will almost certainly increase significantly - implying that most cases now entering the system will not be completed until well into 2022.
  • According to LSE London calculations, London boroughs could have been expected to incur costs net of Housing Benefit of approximately £59.0 million in the first year, from April 2020 – March 2021 including the costs of temporary and move-on accommodation as well as support. Separately, the GLA expected to spend some £39.8 million accommodating rough sleepers in the first year – so a total of nearly £100 million.

This study from LSE London, funded by Trust for London, looks to review how COVID-19 has impacted on the problems of homelessness and rough sleeping; to clarify how policies, implementation and funding have changed; and to ask where we go from here.

In particular, it looks at how local authorities have changed their approach; the relationship between private renting and homelessness; and the effectiveness of the Everyone In initiative.

Key findings

The impact on Local Authorities and the continuing need for temporary accommodation

  • In response to COVID-19 local authorities were faced with both increasing responsibilities and the need to implement quite different approaches to help both ‘traditional’ homeless households and those affected by the Everyone In initiative.
  • Although there was some commonality in boroughs’ experiences across London during the first lockdown and later, there was also considerable variation in approach.
  • During this first year of the pandemic the accommodation and support needs of rough sleepers have dominated the homelessness agenda. And despite success in bringing people off the streets and rehousing others from shared facilities, a continuing flow of people has appeared or reappeared in need of support throughout the pandemic. As a result, in total far more people were accommodated than expected.
  • Meanwhile, the ban on evictions and the furlough scheme have protected many ordinary households from the full economic impact of successive lockdowns. But move on for those already in temporary accommodation has been difficult and there is real concern about the projected growth in demand for temporary accommodation from households facing homelessness once the ban on evictions is lifted and unemployment rises later this year.

The private rented sector: some numbers on those at risks of eviction

  • One of the most obvious concerns arising from the COVID-19 crisis was the fear that there would be mass evictions in the face of rent arrears. The government responded with suspensions of notice and eviction which still continue. There is thus a backlog of people under threat.
  • Around 6–7% of tenants appear to be in arrears– around twice the ‘normal’ proportion. Some 10% of private tenants are thought to be unemployed, about double the average rate.
  • Given projections of unemployment and the relationship between unemployment and rent arrears, over 400,000 tenant households might be expected to be in significant arrears at the end of the year.
  • In many cases landlords and tenants have found ways of coping. But the longer tenants remain in accommodation where they can’t pay the rent, the higher their future debts will be and the greater difficulties facing both tenant and landlord.
  • Perhaps most importantly, the courts will face major difficulties in coping with any significant increase in landlord claims. As a result, the time taken to get an order, let alone to gain possession will almost certainly increase significantly - implying that most cases now entering the system will not be completed until well into 2022.
  • What impact this will have on the private rented sector into the medium term is unclear – but almost certainly undesiable.

Everyone In: some numbers on temporary and settled accommodation

  • Prior to the pandemic the number of those sleeping rough was measured at around 4,250 in November 2019. By May 2020 nearly 15,000 people had been accommodated (around 30% in London), including many who had been living in COVID-19 unsafe accommodation. Based on November 2020 evidence the NAO suggested that over 33,000 had been helped while the latest figures quoted by the MHCLG Select Committee suggested the figure had risen to 37,500 by March 2021. Numbers of those moved on to settled and supported accommodation were stated to be of the order of 26,000.
  • However, looking at the numbers, it remains unclear how many people were actually helped during the pandemic. Some evidence from London suggests that at around 25% of those who have been accommodated in emergency accommodation have left voluntarily, perhaps only to reappear at least once or on multiple occasions. The numbers of those who have actually been helped is therefore unclear.
  • Perhaps more importantly an unknown proportion of those counted were already in the system, although in COVID-19 unsafe accommodation – and would already have been receiving other assistance. Being unable to separate these two groups makes assessment of the requirements for different types of support extremely difficult- especially as included in those moved on to ’settled’ accommodation are unknown proportions of those who were allocated short term supported accommodation.

The costs of Everyone In in London

  • According to LSE London calculations, London boroughs could have been expected to incur costs net of Housing Benefit of approximately £59.0 million in the first year, from April 2020 – March 2021 including the costs of temporary and move-on accommodation as well as support. Separately, the GLA expected to spend some £39.8 million accommodating rough sleepers in the first year – so a total of nearly £100 million.
  • In addition, there would be follow-on costs in subsequent years, mostly because former rough sleepers often have additional support needs. The boroughs estimate costs at £31.3 million in the next financial year, while the GLA expects to spend £13.1 million after the first year. This brings the total cost to London local government of accommodating the roughly 6700 ‘Wave 1’ of rough sleepers to £143.2 million, suggesting a per-capita cost for the Wave 1 cohort of £21,400.
  • The average annualised cost of temporary accommodation reported by the boroughs was £15,500 for each individual non-NRPF case (although note that not all individuals remain in TA for a full year). This is somewhat lower than the average costs of nightly paid accommodation in London.
  • The cost of hotel accommodation was somewhat higher, at £19,900 per annum. For NRPF cases, the estimated annual cost of move-on accommodation was lower, at £13,500.

Key recommendations

  • In terms of policy:
    • Section 21 evictions should be stopped immediately to give more security to private tenants.
    • LHA should be kept at the thirtieth percentile. The welfare cap also needs to be reviewed in the light of these payments.
    • The £20 Universal Credit uplift should be maintained and the possibility of government paying rent to the landlord during the 5-week waiting period should be examined.
    • Government should support greater investment on prevention services including Discretionary Housing Payments.
    • More help to mitigate arrears should be provided – eg through low interest rate loans to tenants with less than 6 months’ arrears.
  • In terms of practice:
    • Evictions by social landlords should continue to be restricted to help limit private sector delays.
    • Courts need more resources but also should develop streamlined procedures to reduce projected delays.
    • Court proceedings for egregious cases and more than six months’ arrears must be speeded up.
    • A pre-action protocol for the private sector should be put in place for all notices of eviction issued after May 31st.
    • The potential for greater integration of the management of main duty and rough sleeper temporary accommodation at local authority level should be reviewed.
    • A full social cost benefit evaluation of the Everyone In initiative, based on great understanding of process and outcomes should be undertaken.