Move to push more temporary tenants into private housing set to save council nearly £1m per year, reports Simon Allin, Local Democracy Reporter

Enfield Council plans to hike rents for residents in temporary accommodation as it seeks to encourage them to move into the private sector.

The move, which will see rents for those in temporary accommodation rise between £169 and £269.79, is also designed to save the council more than £950,000 on housing benefit subsidies.

Senior councillors said the majority of households in temporary accommodation would see their benefits rise to cover the costs, while claiming that those not currently on benefits could afford to move to the private sector.

According to the report presented to a meeting of the council’s cabinet on Wednesday, current low rents mean the council is “effectively subsidising” temporary accommodation instead of focusing on measures to reduce the risk of residents becoming homeless.

Before the outbreak of the Covid-19 pandemic, the council aimed to have fewer than 2,700 households in temporary accommodation by the end of 2021/22. But a failure to meet that target left the authority with a £1.5million budget deficit.

The report states that the pandemic increased the number of households in temporary accommodation as the council provided housing for rough sleepers. After the government lifted a ban on evictions in August last year, more people began to approach the council for help.

These issues have been compounded by landlords exiting the market, leading to a supply shortage and an increase in rents. Because of the shortage, the council has been using shared accommodation and hotels, which are more expensive and “not suitable for residents”.

According to the report, welfare benefits “play a key role in trapping people in temporary accommodation”. This is because they are entitled to full housing benefit provided they have a Universal Credit claim, meaning it is “always cheaper for them to live in temporary accommodation than any other tenure”.

As the council cannot claim the full amount it pays out in housing benefit back from the government, the amount it spends on subsidy is forecast to rise by £7.5m by December 2024.

The council now plans to increase temporary accommodation rents for all tenants to local housing allowance levels for the area in which they live. For residents in temporary accommodation in Enfield, this would mean hikes of between 16% and 22%.

The report says the “vast majority” of the 3,100 households currently in temporary accommodation would have the rent increase covered by their benefits in full. It adds: “There are 372 households who are not in receipt of benefits but the majority of these are households awaiting their claim to be processed.

“There are only 101 households who are not on any form of benefit, and they would need to either pay more towards their rent or apply for welfare benefits.”

Hiking the rents would increase the number of households subject to a cap on their benefits by 182, the report adds. It states that those on legacy benefits are due to move over to Universal Credit by December 2024, meaning their rent would be covered in full.

According to the report, the measures would reduce the cost of the housing benefit subsidy paid by the council by around £958,000 during 2023/24.

The council is looking to boost the supply of private rented accommodation through a range of initiatives. However, the report states that because of the shortage of properties it is now housing people outside of the borough if they agree to the move.

Plans have also been drawn up to use its temporary accommodation blocks Brickfield House, in Southbury, and Greenway House, in Harlow, for shorter-term emergency accommodation. Under the proposals, people would be allowed to stay for up to eight weeks before being offered a place in the private rented sector. The council hopes the move will save £1m.

George Savva, cabinet member for social housing, told Wednesday’s meeting that the measures set out in the report “will enable us to increase the number of homes available to rent and remove barriers to residents moving out of temporary accommodation”.

He added: “The report will also enable us to help households who need to access discretionary housing payments. Without this, these households would be facing homelessness.”

In response to a question from fellow cabinet member Rick Jewell, Cllr Savva said the majority of households’ housing benefit would rise to cover the cost of the rent increase. He added that the 101 households in temporary accommodation that are not on any benefit “can afford to move into privately rented accommodation”.

Council leader Nesil Caliskan said that support would be available for the remaining “small number [of households] who might be affected” by the rent increases.

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