The Local Government Association is calling on the Government to urgently reform housing benefit subsidy rules and invest in supported housing, warning that a lack of provision is placing unsustainable pressure on health services and undermining the effective implementation of the Supported Housing Act.
In 2023–24, a shortage of supported housing cost the NHS £71 million due to delayed discharges from mental health hospitals. Expanding provision could save the NHS up to £50 million annually and deliver a £6 billion saving across the wider public sector.
Supported housing provides a vital safety net for people with complex needs, including:
- Those at risk of homelessness
- Care leavers
- People with disabilities
- Individuals with mental health conditions
It offers stability and independence and helps prevent hospital admissions and making it a cornerstone of a preventive care system that supports healthier, more equal lives.
Coinciding with the publication of new LGA guidance for councils, the call to government highlights the growing demand for supported housing. Analysis by the National Housing Federation projects that by 2040, an additional 200,000 units will be needed to meet demand.
Chair of the LGA Health and Wellbeing Committee, Cllr Wendy Taylor, said:
“Councils are committed to providing high-quality supported housing for residents and want to invest more to continue enabling people who draw on care to lead independent and fulfilling lives.
“Groundwork is being laid by councils across the country, through innovative working ahead of the implementation of the Supporting Housing Act. But, without much-needed long-term investment in this essential preventative care service, many older people and those with physical and learning disabilities will continue to be in hospital and residential care longer than necessary. Young care leavers, people fleeing domestic abuse, and those experiencing homelessness will be without stable housing.
“We urge the Government to work with councils to invest in supported housing, to enable councils to meet their duties under the Care Act, deliver licensing schemes, enforce new standards and support providers with building a supported housing system that is fit for the future.
“This new guidance will support councils to identify the most effective tools to deliver high-quality supported housing schemes within the context of their local priorities, challenges and capacities.”
The LGA is urging the Government to:
- Fully fund new burdens to help councils implement licensing schemes and enforce standards
- Sustainably fund commissioning to prevent homelessness and ease hospital discharge
- Reform housing benefit subsidy rules, which currently leave councils millions of pounds out of pocket
The new guidance, informed by the Supported Housing Improvement Programme (SHIP) pilots, provides councils with practical tools to improve oversight, strengthen provider relationships, and deliver better outcomes for residents.
This renewed focus on supported housing is part of a broader strategy to adapt homes, invest in community support, and reduce isolation, helping people live independently and with dignity.
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