Almost three quarters of homelessness services could be reduced or lost without Welsh Government support

More than 70% of vital services which help to prevent homelessness across Wales could be reduced or lost if crucial Welsh Government funding is not increased, campaigners have warned.

The warning comes from Cymorth Cymru, and Community Housing Cymru, which together represent over 100 charities and not-for-profit housing associations in Wales.

Through their Housing Matters campaign, these organisations are calling for an urgent increase to the Housing Support Grant (HSG) in Welsh Government’s budget for 2024/25.

Every year the HSG funding helps more than 60,000 people through the provision of refuge, supported accommodation and tenancy support services, preventing people from sleeping rough, enabling people to leave abusive relationships, and helping people to overcome trauma, mental health problems and substance use issues.

The HSG is critical to preventing and alleviating homelessness in Wales, and research by Cardiff Metropolitan University has shown that for every £1 invested in services through the grant delivers a net saving of £1.40 to other public services through reduced pressure on health, social care and criminal justice services.

Demand

Last year, the HSG suffered a real-terms cut, remaining at £166.7 million for
2023/24 despite rising costs and inflation, and increasing demand.

Since 2012, cuts and a lack of increases has meant that housing support funding has decreased by £24 million in real terms.

As Wales deals with the impact of rising costs and inflation, research by Cymorth Cymru and Community Housing Cymru has found that the lack of funding is negatively affecting homelessness service delivery:

27% of support providers have had to reduce service capacity and 66% are having to operate waiting lists for services.

75% are running services at a deficit and 45% of support providers have chosen not to bid for new or re-tendered contracts, as they are unable to deliver safe, high quality services for the funding available.

Demand for these services has never been greater with over 11,000 people are in temporary accommodation.

81% of support providers have reported increased demand for their services since last year and 94% reported increased complexity of support needs.

Research has shown there is a risk of services significantly reducing, closing and collapsing if there is no increase to the HSG funding next year.

77% of support providers have revealed they would be forced to reduce
their service capacity and 40% also say they are likely to hand back existing contracts and 67% said they are likely not to bid for new or re-tendered contracts.

Alarming

Katie Dalton, director of Cymorth Cymru, said: “Everyone deserves a place to
call home, but our research paints an alarming picture of housing support
services on the brink of collapse, which would be disastrous for people
experiencing, or at risk of, homelessness.

“Unless there is an increase in funding, providers will need to close vital services or significantly reduce delivery at a time when more people than ever are in need of help.

“These not-for-profit providers desperately want to deliver safe, high quality
services that transform people’s lives, and they share Welsh Government’s
ambition to end homelessness. However, this can only be achieved if the
Housing Support Grant is increased in next year’s budget.”

Rhea Stevens, head of policy and external affairs at Community Housing
Cymru, said: “These services make a real difference to the lives of people at risk of, or experiencing homelessness, and their loss or further reduction would be absolutely devastating for Wales. It would risk deeping the homelessness and housing crisis.

“The help that they provide is life-changing – and yet they have been under
constant pressure over the last decade. Funding constraints, a huge growth in
demand for support, and an increase in complexity of people’s support needs,
are all pushing services closer and closer to breaking point.”

Vulnerable

The Welsh Government has warned that the UK Government’s recent Autumn Statement contained no targeted support for the most vulnerable and nothing new or meaningful for Wales.

Plans are being made to consider the impact of the statement as the Welsh Government continues preparations for the publication of its draft Budget 2024-25 on 19 December.

A spokesperson said: “We recognise the immense pressures facing frontline housing support services and the importance of their work.

“This is why we maintained the previous increase to the Housing Support Grant budget this year so that it remains at £166.763m, despite the extraordinarily difficult budgetary position.

“Ministers face an incredibly difficult task in setting a budget for next year, the draft budget will be published on 19 December.”