The Consultation

Homeless Connect has made its submission to the Department of Finance’s consultation on the draft budget for 2025/6. The draft budget sets out the spending envelope for Executive Departments for the forthcoming financial year.

Our response to the consultation was informed by insights from our Policy Forum. The forum is made up of representatives from our member organisations. Homeless Connect are grateful to policy forum members for their invaluable insights.

Key Points

• For the homelessness sector, this is yet another deeply concerning budget. When it comes to both resource and capital spending, we believe that the Department for Communities is not receiving sufficient funding to allow for the Department, the Housing Executive and the wider homelessness sector to prevent and reduce homelessness. This is true both in terms of Capital and Resource funding.

Capital

• DfC Officials told the Committee for Communities that the Department only have “about £50 million to deal with our new homes and all of our projects right across the Department. If we took that £50 million and put that all into social homes, the indications would be £50 million would get us about 1000 homes, but that would mean no investment in anything else in capital across our department as a new investment.”
• On Monday 3 March, the NI Executive published the final Programme for Government. The programme includes the following commitment: “Our Target for 2027: By the end of this mandate, we will have started work on at least 5,850 new build social homes.” If 2024/5 is included and around 1,500 social housing new starts are completed this year- which appears to be plausible- this would mean in 2025/6 and 2026/7 4,350 social housing new starts would be required. It is very difficult to see how the level of investment outlined in 2025/6 for DfC’s capital budget will allow for this target to be met. A basic condition to turning the curve on these numbers is increasing the supply of housing. The initial allocation provided to the Department for Communities is quite simply insufficient for the level of need which is out there.

Resource

• The draft budget proposes allocating an additional £30.9 million in non-earmarked resource funding to the Department for Communities for 2025/6 compared to the previous year, an increase of 4.3%. Any increase in funding for the Department is a welcome change from some previous years. However, we are deeply concerned that this increase will not be sufficient for the Department to respond to a major issue facing community and voluntary organisations here- the consequences of the 2024 UK Budget. Most notably, the impact that the changes to national insurance contributions and the national living wage will have on homelessness sector organisations.
• Members of Homeless Connect’s Policy Forum have starkly spelt out to us what some of the consequences will be if the impact of the changes to the Employers National Insurance Contributions and the minimum wage are not mitigated.
  • • A further deepening of the recruitment and retention difficulties facing the homelessness sector
    • Even more use of agency staff.
    • Reduced capacity to provide support to clients who present with a range of needs
    • Budgetary uncertainty imposing real costs
    • Potential for redundancies and service closures

Conclusion

• Homeless Connect believes that if the UK Government fails to cover the cost of the national insurance rises, the NI Executive will need to reconsider the proposed budget given to the Department for Communities to ensure that additional funding will be provided to SP and to the homelessness prevention budget in 2025/6 to at the very least cover the costs of these changes. We would also point out that homelessness services funded through these funding streams are key partners in the delivery of a wide range of Executive policies and strategies in areas such as tackling violence against women and girls; criminal justice; mental and physical health; and community relations. Failure to increase funding to at the very least mitigate these changes will negatively impact on the ability of organisations in the homelessness sector to contribute to Executive goals in these areas.

Where can I read the full response?

You can read the full response on our website here.