Lewisham Council in financial crises due to housing shortage
Lewisham Council have warned of a substantial overspend of £35 million this financial year due to an increase in homeless households in temporary accommodation.
The council state “our overspend for 2024/25 is now expected to be over £27m after using £9m of one-off measures” with “costs due a lack of social housing reaching £85m a year, up from £65m last year (an increase of 30%)”.
The council joins many others battling high costs due to a lack of new council and social housing. Greenwich Council are seeing similar pressures with the authority now block-booking entire hotels, as numbers of homeless households reach 2,000.
Meanwhile Greenwich have also agreed to sell land once again limiting the potential to build new low-cost housing to alleviate pressures. Short term income, long term costs.
Lewisham borough now have 3,000 homeless households following a trend across London where numbers has risen by 5,300 to 68,000 households and 183,715 individuals costing £1.4bn a year – and rising.
The problem extends beyond London, with an example being Dartford Council seeing a rise of 24 per cent in households placed in temporary accommodation over just eight months between December 2023 and July 2024.
They now have 474 households in temporary accommodation at high cost but just 25 new homes in the Council’s new build programme.
Housebuilding remains at extremely low levels in recent quarters across London, with new social and council housebuilding scrapping the floor.
Lewisham have seen vast sites in public ownership sits empty for 15 years such as Besson Street in New Cross as plans came and went. Zero social or council homes are planned.
Other issues include the Ladywell Place site which was supposed to be able to move around the borough offering temporary homes. It was discovered a few short years after installation that it couldn’t in fact be moved and thus a decision was taken in 2021 to keep it in situ.
It offers just 24 homes compared to an alternative plan in 2021 to build 232 new homes on site. Eventually a proposal to build to the rear was taken in 2023. Nothing has completed.
Four years have been wasted contributing to today’s ever growing problem. In fact, it would have made more sense to build new housing outright back in the mid 2010s.
Lewisham like Greenwich have embarked on a mass program of buying existing homes using public funds rather than building new council and social homes and providing an overall net increase in homes due to rising demand.
This appears to be doing little to alleviate the problem as each year the problem worsens. Meanwhile private renters are at risk of eviction due to council purchasing from private landlords and in turn become homeless ending up in temporary accommodation.
By law council’s have a legal obligation to house many of those seeking assistance who are homeless. A shortage of council and social housing then necessitates utilising extremely expensive temporary housing whether hotels, B&Bs or private landlords.
Other pressures
Another factor in Lewisham’s mounting budget problems are social care costs which are seeing exponential growth.
Lewisham council’s Mayor states: “The cost of supporting children with social care has increased 12% – or £9m – from £72m to £81m.
“Likewise, the cost of supporting adult social care needs has increased, as we see more and more complex requirements, leading to a predicted £5.7m overspend.”
The council are clear this means cuts elsewhere: “There’s no denying this will have an impact on the services residents receive – particularly the services we do not legally have to provide”.
Central government
Where we go from here remains an unknown. The newly elected government have offered some tinkering but nothing substantial to provide a mass program of new low cost housing.
This week’s announcement of £500 million extra funding will pay for barely 5,000 homes. That’s to cover the entire country while homeless households in Lewisham and Greenwich alone now total 5,000.
It’s in additional to the prior governments £11.5bn Affordable Housing Programme funds covering five years which has failed to provide anywhere near enough new homes. In fact some has been used for the failing policy of buying existing homes.
Other funding announcements such as a modest amount for brownfield land remediation is a continuation of previous Conservative policy announced in 2022, and so far yielded little impact due to small sums involved.
While governments old and new dilly-dally the number of homeless household’s in temporary accommodation across London has risen by more than 5,300 in a year to March 2024. Go beyond the capital and pressures are similar.
Meanwhile the cost to London council’s is now at £1.4bn, while nationwide housing benefit bills are up to £30.5bn a year.
Running a site alone takes time and a fair bit of money. Adverts are far from enough to cover it and my living costs as a private renter.
You can support me including via Paypal here Another option is via Patreon by clicking here You can also buy me a beer/coffee at Ko-fi here There's also a Facebook page for the site here Many thanks
Lewisham, has properties, occupied by cuckooers, and nothing over the years, has been done to address the situation. The problem was induced by the late ALMO – Arms Length Mis’management Organisation – (Lewisham Homes).
Lewisham should only be housing people from their waiting list for social housing born and bred in the Borough first and foremost. As should any Botough a cross the UK. People should not be forced to move way from the Borough they wre born an bred in away from family friends and their support networks.
They need to stop building hotels and student accommodation and build more homes for people on the housing list and those wishing to downsize from larger family homes to more suitable accommodation.