Chapter 5: Contracting out homelessness functions

Guidance on contracting out homelessness functions.

5.1 This chapter provides guidance on contracting out homelessness functions and housing authorities’ statutory obligations with regard to the discharge of those functions.

5.2 The Local Authorities (Contracting Out of Allocation of Housing and Homelessness Functions) Order 1996 (‘1996 Order’) enables housing authorities to contract out certain functions under Parts 6 and 7 of the 1996 Act. The 1996 Order is made under section 70 of the Deregulation and Contracting Out Act 1994 (‘1994 Act’). In essence, the 1996 Order allows the contracting out of executive functions while leaving the responsibility for making strategic decisions with the housing authority.

  1. 5.3 The 1996 Order provides that the majority of functions under Part 7 of the 1996 Act can be contracted out. These include:

    1. (a) making arrangements to secure that advice and information about homelessness, and the prevention of homelessness, is available free of charge within the housing authority’s district;

    2. (b) making inquiries about and deciding a person’s eligibility for assistance;

    3. (c) making inquiries about and deciding whether any duty and, if so, what duty is owed to a person under Part 7;

    4. (d) assessing eligible applicants’ cases and agreeing a personalised housing plan;

    5. (e) undertaking prevention and relief duties owed to an applicant;

    6. (f) making referrals to another housing authority;

    7. (g) carrying out reviews of decisions; and,

    8. (h) securing and helping to secure accommodation to discharge homelessness duties.

5.4 Where decision-making in homelessness cases is contracted out, housing authorities may wish to consider retaining the review function under section 202 of the 1996 Act. This may provide an additional degree of independence between the initial decision and the decision on review.

  1. 5.5 The 1994 Act provides that a contract made:

    1. (a) may authorise a contractor to carry out only part of the function concerned;

    2. (b) may specify that the contractor is authorised to carry out functions only in certain cases or areas specified in the contract;

    3. (c) may include conditions relating to the carrying out of the functions, e.g. prescribing standards of performance;

    4. (d) shall be for a period not exceeding 10 years and may be revoked at any time by the Minister or the housing authority. Any subsisting contract is to be treated as having been repudiated in these circumstances; and,

    5. (e) shall not prevent the housing authority from exercising themselves the functions to which the contract relates.

5.6 Schedule 2 to the 1996 Order lists the homelessness functions in Part 7 of the 1996 Act that may not be contracted out, for example the provision of assistance by way of grant or loan to voluntary organisations concerned with homelessness or related matters under section 180 of the 1996 Act.

  1. 5.7 Housing authorities also cannot contract out their functions under the Homelessness Act 2002 which relate to homelessness reviews and strategies. These include:

    1. (a) section 1(1): carry out a homelessness review for the district, and formulate and publish a homelessness strategy based on the results of that review;

    2. (b) section 1(4): publish a new homelessness strategy within 5 years from the day on which their last homelessness strategy was published; and,

    3. (c) section 3(6): keep their homelessness strategy under review and modify it from time to time.

For further advice on homelessness reviews and strategies see Chapter 2.

5.8 Homelessness reviews and the formulation of strategies can, however, be informed by research commissioned from external organisations.

  1. 5.9 The 1994 Act also provides that the housing authority is responsible for any act or omission of the contractor in exercising functions under the contract, except:

    1. (a) where the contractor fails to fulfil conditions specified in the contract relating to the exercise of the function; or,

    2. (b) where criminal proceedings are brought in respect of the contractor’s act or omission.

5.10 Where there is an arrangement in force under section 101 of the Local Government Act 1972 whereby one housing authority exercises the functions of another, the 1994 Act provides that the authority exercising the function is not allowed to contract it out without the principal authority’s consent.

5.11 Where a housing authority has contracted out the operation of any homelessness functions, the housing authority remains statutorily responsible and accountable for the discharge of those functions. This includes any public sector equality duty obligations under section 149 of the Equality Act 2010. The housing authority will therefore need to ensure that the contract provides for delivery of the homelessness functions in accordance with both the statutory obligations and the authority’s own policies on tackling and preventing homelessness.

5.12 Housing authorities should ensure they have adequate contractual, monitoring and quality assurance mechanisms in place to ensure their statutory duties are being fully discharged.