London Councils has declared there can be “no return to business as usual” on homelessness, as it revealed that boroughs are spending an extra £50 million on homelessness and rough sleeping due to Covid-19.

With emergency accommodation secured for almost 5,000 rough sleepers since the start of the pandemic, the cross-party group believes there is now “a golden opportunity” to end rough sleeping altogether.

However, London Councils has highlighted the need for sustained support for tackling homelessness. Despite emergency investment from the government, boroughs are increasingly worried about the funding available for rough sleeper support.

Boroughs are also concerned about the consequences of the government’s three-month moratorium on evictions coming to an end on 25 June. With so many Londoners losing jobs and income due to the impact of Covid-19, boroughs are warning of an “avalanche of evictions”. Boroughs believe this could lead to a summer spike in homelessness that would take rates above where they were before the coronavirus pandemic began.

Even before Covid-19 struck, London was suffering the most severe homelessness crisis in the country – accounting for two-thirds of homelessness in England. The £50 million of extra spending in the wake of coronavirus comes on top of the approximately £1 billion annual cost of boroughs’ homelessness and rough sleeper provision.

London Councils has long warned that these costs are unsustainable – with around £200 million of the boroughs’ £919 million annual expenditure on homelessness and rough sleeping in 2017/18 not covered by government grants or councils’ housing income. This means boroughs resort to bridging the gap using their general funds (which could be invested in other council services).

To help sustain London’s homelessness services and embed the progress made on reducing rough sleeping, London Councils is calling for:

• An immediate boost to local authority funding to meet the higher support needs of rough sleepers and ensure onward accommodation can be secured. Although the government has announced a £433 million national rough sleeping fund – over a four-year period – to provide new accommodation and specialist support, allocations have not yet been confirmed. London boroughs are concerned that the number of homes being delivered through this for rough sleepers does not provide sufficient accommodation to meet current need. 
• A twelve-month suspension of no recourse to public fund (NRPF) restrictions to unlock financial support for those who would otherwise return to rough sleeping. London Councils warns that at least 900 rough sleepers accommodated in London are subject to NRPF restrictions. 
• Further welfare policy changes to support homeless Londoners and those at risk of homelessness, including lifting the benefit cap and abolishing the local housing allowance shared accommodation rate for single applicants under 35. 
• A phased lifting of lockdown measures to avoid a cliff edge when hotel accommodation used to shelter rough sleepers returns to commercial use and the government’s temporary ban on evictions is lifted.