Councils across England are facing an unprecedented financial crisis, burdened by a staggering £6 billion bill for providing temporary accommodation for homeless families. This figure represents a 1,000% surge in expenditure over the past 13 years, with a hefty £2.2 billion spent in just two years – 2023/24 and 2024/25.
The Local Government Association (LGA) has sounded the alarm, warning that current spending rates are unsustainable and urging the incoming Prime Minister to act swiftly. Cllr Eamonn O'Brien, LGA Chair, described temporary accommodation costs as a "huge leak in council budgets" that demands urgent attention – not just for financial stability but also to improve the lives of vulnerable families and children.
London is at the epicentre of this crisis, with spending increasing from £59.5 million to £739.9 million (a 1,143% rise). However, data reveals a nationwide issue affecting all regions: the East Midlands saw a massive 4,182% increase, followed by the West Midlands (1,539%), and the South East (1,339%). Even the South West – with the smallest percentage rise – experienced a 398% increase.
The LGA blames the current system for reimbursing councils as ineffective, creating a ripple effect that impacts broader budgets and essential public services. Temporary accommodation is not just draining resources but also deeply disrupting the lives of those placed in such housing, often involving multiple moves and instability for children.
The association's strategy to tackle homelessness centres on ensuring a sufficient supply of affordable homes – fundamental to building strong communities. LGA views councils as key players in achieving this goal and is eager to collaborate with government to address the housing crisis effectively and reduce reliance on costly temporary solutions.