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Where to Make Savings in Homelessness Services


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Presentation given by Matt Harrison, CEO, Homeless Link, UK, at a FEANTSA seminar on "Funding strategies: Building the case for homelessness", hosted by the Committee of the Regions, June 2012

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Where to Make Savings in Homelessness Services

  2. 2. Introduction • Homeless Link is the national membership organisation for homelessness services in England • We have over 500 members working with homeless people across the country to end homelessness • Our role is to lobby government on behalf of homeless people and our members and to support and help them in practical ways • We provide advice and support to them through our network of regional managers • These are tough times – most of our members are facing cuts and having to make savings • We’re not yet seeing massive closures of services, but they are happening (4.6% of services closed in 2011/12)WWW.HOMELESS.ORG.UK
  3. 3. Why is there a need to make savings? • The recession has led to an “Age of austerity” • Massive public spending cuts in the UK • Funding cuts to local authorities of 28% over 4 years • Much of this being passed on to our sector • Local authorities provide 70% of our members’ funding • Cuts at a local level varying from 0% to 50% - in year 1 • Most of our members (58%) have been cut already by 15% on average • Most organisations (57%) expect further cuts this year • So far the sector has just about coped – 10 years of public investment means we have a strong and resilient sector • But the risks are growing…WWW.HOMELESS.ORG.UK
  4. 4. Main areas to make savings • Organisational changes • Staffing • Methods of deliveryWWW.HOMELESS.ORG.UK
  5. 5. Organisational savings • Mergers and collaborations • Sharing resources • Outsourcing back-office services • Alternative income streams – Social EnterpriseWWW.HOMELESS.ORG.UK
  6. 6. Case Study North East •4 small local agencies have formed a partnership to share all their back-office functions. •Not a merger - a collaboration •Share IT, HR and training and finance staff •Use staff to cover holidays and sick leave – reduce locum costs •Now employing a Business Development Manager to bid for contracts as a consortiumWWW.HOMELESS.ORG.UK
  7. 7. Case study North West • A medium sized charity has joined a large Housing Association in a group structure. • Retain their own independent board and business plan • Use the larger organisation’s HR, IT, Finance and Business Development teams • Reduces costs, gives them more resilience and makes them more likely to win contracts • Some loss of independenceWWW.HOMELESS.ORG.UK
  8. 8. Case study South West • Medium sized charity providing hostels and other services for homeless people • Set up a sustainable Social Enterprise, employing service users • They deliver construction and services for local housing associations (eg. clearances, redecoration and refurbishment) • Turnover has reached £300,000 – not yet making profits for the parent charity but growing fast. • This is in addition to providing a route into employmentWWW.HOMELESS.ORG.UK
  9. 9. Staffing • Typically the biggest element of a budget for our sector • On average in the UK about 70% of total costs • If services are to continue with lower levels of funding, then staffing costs have to reduce • Many organisations in the UK are reviewing and reducing salaries and changing terms and conditions (eg. longer hours) • Competitive tendering makes this more likely • Fears of a “race to the bottom” • What else can be done?WWW.HOMELESS.ORG.UK
  10. 10. Staffing options - 1Possible Benefits Risks Mitigating actionsresponseReduce number • Removal of less effective staff • Low morale • Staff consultationof staff, including • Interventions can be more • Longer working hours for throughoutsharing managers focussed remaining staff • Planning with staffacross services • New creative ways of working • Fewer support hours leading to • Measuring impact of can inspire staff and achieve more incidents and worse changes better outcomes outcomes • Work with external partners • Clients with high support needs receive all attentionEmploy lower • Supervisory opportunities for • Inexperience leads to more • Review JDs and PSs tograde staff existing staff incidents ensure that the skills • Provide placements for social • Lack of confidence among required are right work students team • Ensure training and supervision is in place • Arrange external supervision from others WWW.HOMELESS.ORG.UK
  11. 11. Staffing options - 2Possible Benefits Risks Mitigating actionsresponseReduce • Better rota for full-time project • Fewer professional staff at • Staff consultation workers, increasing morale critical times • On-going review of incidentsstaffing at • Increased risk of incidents and impactnight • Training for night staff • Review risk and incident policies • Implement a risk registerUse of more • Increased engagement with • Inexperience • Training and support from the community • Reduced client satisfaction volunteer agenciesvolunteers • Increased client involvement • As above • Social work students • Volunteers bring new skills • Use skilled volunteers to fill and expertise (possibly gaps experience of homelessness) • Be clear about what you are • Frees up staff to do more in asking volunteers to do depth case workWWW.HOMELESS.ORG.UK
  12. 12. Case study London • A new hostel that operates more as a hotel (not for cost reasons) • No night staff, but a concierge service • Just to provide security, not support • Lower costs, and many organisations find that night staff are not as effective as they would hope at providing support.WWW.HOMELESS.ORG.UK
  13. 13. Case study London • Large provider set themselves a target to reduce their costs • All staff had a small pay cut and a longer working week • One layer of senior management removed • All staff asked to feed in ideas how to make savings • More use of sessional staff, interns, trainees and volunteers • Outsourced IT support • Contracts centralised and consolidated (eg. mobile phones) • Achieved their targeted cost savings, but some impact on morale – partly because they started first rather than waiting until everyone was doing it.WWW.HOMELESS.ORG.UK
  14. 14. Case study London •Teams of 3 floating support staff now 1 staff member, 1 trainee, 1 volunteer. The trainee is paid, the volunteer unpaid •Both trainee and volunteers receive accredited training and a qualification after 1-2 yearsWWW.HOMELESS.ORG.UK
  15. 15. Service changes Possible Benefits Risks Mitigating actions response Stop delivering • Become more efficient • Job losses • Redeploy staff to other less crucial or • Only support those with the • Increased pressure and services ineffective areas highest need demand on other services • Consult and measure of your service – • Risk to clients if vital service impact of change for example is removed throughout serving lunch. Engage the • Increased community • Fragmented service delivery • Joint working protocols engagement c • Service level agreements • New opportunities and o • Review policies and impact. creative mapproaches m u n i t y aWWW.HOMELESS.ORG.UK n d
  16. 16. Case study East Midlands • A large hostel redeveloped with public investment • Some self-contained units, high standard, separate entrance • These units are part of the service while they have funding • But could rent these units commercially to generate income to support the rest of the service.WWW.HOMELESS.ORG.UK
  17. 17. Case study North East • Floating support service working with young people • Funding cut significantly • Now offer initial support when young people move in • All follow up work done by young people visiting them • Retains contact, builds independence and responsibility and at a lower costWWW.HOMELESS.ORG.UK
  18. 18. Conclusions • After 10 years of increased investment in services in the UK, we are facing a sustained period of cuts • No organisation wants to close services – especially as the recession means demand is rising • So we have to look to see if we can make savings in our homelessness services. • There are clear risks from these actions that need to considered and mitigated. • But the risks to our clients of closing services may be higher. • Further reading on what’s happening in England: