Sandwell Council spends £2.5m on housing homeless in B&Bs

The number of households in Sandwell currently in ‘temporary’ accommodation – mainly bed and breakfasts (B&Bs) – has risen by an “unprecedented” 345% in the last three years with the council spending £2m more than it did in 2021. 

Cabinet papers reveal Sandwell Council is now looking to rent up to 100 properties to end its – more expensive – reliance on bed and breakfasts. 

Councillors meet today (Wednesday) to discuss the proposals which include tendering a two-year contract for the accommodation for homeless families. 

The Black Country local authority has already converted some of its property into temporary accommodation in recent years – a move it says has already saved £1.2m. More property is currently being converted with the hope of saving a further £500,000.

Nevertheless, the council still spent £2.5m on temporary accommodation last year, compared to £400,000 in 2021. The number of people in Sandwell in temporary accommodation has increased by 345% from 2021 – rising from 44 households during the pandemic to 196 in March. 

The council currently spends around £500 per bed and breakfast room per week on average – with housing benefits covering around a fifth of the bill leaving £400 to be paid for by the council. The private accommodation it is now looking to secure would cost Sandwell Council around £315 per week instead of £400 at a B&B. 

Legislation changes during the Covid-19 pandemic saw a temporary block on evictions. 

The number of households in temporary accommodation dropped to 30 in May 2021 but soon increased after the freeze ended. Since then, the number of people in temporary accommodation has quadrupled and the council is spending £2m a year more.

Sandwell Council said it currently uses homelessness prevention funding it receives from the government to pay for temporary accommodation. However, proposed changes to how homeless prevention funding is calculated could see Sandwell’s share cut by more than 40 per cent next year.

The council said it would have to slash the number of staff by half and resort to ‘crisis management’ over housing rather than prevention. As a result of the funding cut, the council said it would have to find another £1.5m as a “minimum” to cover costs. 

A report, due to be discussed by the council’s cabinet today said these changes would force the council into spending £1.5m more on temporary accommodation as a “minimum.” 

The move to use 100 properties in Sandwell as temporary accommodation would save the council £442,000 a year, it said. 

The council also gives discretionary housing payments (DHP) to people who need extra help with their rent when housing benefits do not cover the full amount and more than half of the £1.078m spent in Sandwell last year on the payments went towards temporary accommodation. 

The amount of the DHP funding required for temporary accommodation doubled year-on-year from 2022 to 2024 and if the rise continues, the amount would be £1.2m – more than what the government gives to Sandwell, leaving the council with having to find at least £500,000 to cover costs.