Private Sector Could Save Councils £10m a Year

by Scott Douglas

Friday, September 28th, 2007

Scotland’s councils could save £10 million a year if they abandon the use of B&B accommodation for people who are short-term homeless in favour of other private sector alternatives.

The potential savings in council tax money was discussed at a major housing conference today (Oct 1) in a speech by Andrew Morrison, Director of Policy and Business Development for Orchard & Shipman, the company managing the Private Sector Leasing Scheme in Edinburgh.

Speaking at the Shelter Scotland Conference – Halfway to 2012, Andrew highlighted the crucial role the private sector could play in eradicating homelessness in Scotland.

Andrew made the case for Scotland’s local authorities to consider additional private sector alternatives, such as Private Sector Leasing to reduce the dependence on Bed & Breakfast accommodation for housing people who become homeless short term.

He also said that increased use of the private sector could see council houses currently used for temporary accommodation being returned to mainstream council stock – making 5,000 permanent homes available.

The call follows statistics which show that 60,000 households are making homeless presentations throughout Scotland each year and over 8,000 are being placed in temporary accommodation.

The speech also outlined further ways private sector leasing could significantly help Scottish local authorities achieve their 2012 target of giving everyone who is unintentionally homeless the right to a permanent home.

Andrew said: “The cost of housing people in B&B accommodation is currently producing a £20 million-a-year rent bill – and only half this cost is being met by Housing Benefit. The remaining £10 million is directly hitting council tax funds.

“Increased, but prudential, use of the private sector would see those in the greatest needed offered access to accommodation that presents a ‘real home at a significantly reduced cost.”

 

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Andrew highlights that Councils still need to ensure the private sector partner offers good value and good quality in terms of service and accommodation if they are to achieve real savings and improvements to living conditions.

“Council homes used for emergency homeless accommodation could also be returned to stock – creating 5000 more permanent homes to offer Scotland’s families.

“In addition, shifting the responsibility of managing the housing of people who are homeless short term from councils to the private sector will free up essential resources within local authorities. This will enable key housing workers to focus more on homeless prevention strategies, which are central to the long-term eradication of homelessness.

“As Scotland faces the historic challenge of ending homelessness by 2012 – an ambition that puts us at the forefront of homeless strategies in Europe – it’s clear PSL could play a major role.”

Archie Stoddart, director of Shelter Scotland, housing and homelessness charity, said: “We believe there are a number of different tools that we have in the box to meet this internationally acclaimed legislation.

“This can include better use of the private rented sector and private sector leasing schemes, as a way to provide good quality temporary accommodation. But we need to make sure people have not just a right to a home but the keys to a home – and with a current shortage of good quality affordable homes, we need to increase supply urgently. That’s why we’re calling for 30,000 affordable rented homes over the next three years through the impending comprehensive spending review.”

Increasingly, Scotland’s local authorities are recognising the potential for private sector leasing and the role it can play in helping to achieve the 2012 targets.

Following the success in Edinburgh, Orchard & Shipman is set to announce the acquisition of three new contracts with Scottish local authorities. In addition, over half of Scottish local authorities have requested presentations on PSL.

The Shelter annual conference will mark the milestone of half way to 2012 – the Scottish Government’s target that will see every unintentionally homeless person being given the right to a home.

Orchard & Shipman has been managing private sector leasing for Edinburgh City Council since its launch in 2005.

The company has been contracted to acquire 1,500 properties within five years for PSL. It has already helped hundreds of families and individuals in housing need get settled in a secure, comfortable home in an area of their choice.

Jane McLeod ,34, went to CEC in 2006 when she encountered difficulties at home. Within a week she was offered an Orchard & Shipman property in Dalry.

She said: “The difference this move made to my family’s life was amazing.”

 

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