Recommendation 24

The NAO investigation found that some local authorities face increasing gaps in funding for supported housing because of the way the DWP’s Housing Benefit regulations work. “Subsidy loss” is the gap in funding between how much rent a housing provider charges to a local authority and how much of it the local authority can claim back from DWP, in line with Housing Benefit rules which are set out in legislation. In some cases, local authorities cannot claim the full amount of rent back and must cover the remaining costs from their own budgets.48