Shabana has written to the National Audit Office calling for an investigation into exempt accommodation.

The failing and flawed system of exempt accommodation is costing local authorities an estimated £1 billion per year, according to a landmark report released last month.

The sector is funded by enhanced housing benefit provided by the Department for Work and Pensions and administered by local authorities.

As the body which scrutinises public spending for Parliament, the NAO is best-placed to conduct a probe into the sector.

In her letter to Gareth Davies, Comptroller and Auditor General, Shabana asks the NAO to consider committing to an investigation.

You can read the letter in full below.

Letter to the NAO

Dear Mr. Davies,

Exempt Accommodation Sector

I am writing to you following the publication of Prospect Housing’s report: A shared vision for better homes, support, and opportunities, to ask you to consider the findings in relation to the exempt accommodation sector.

In a sector first, Prospect have published a report that documents its own shortcomings after its closure earlier this year, in an attempt to help other providers learn from their mistakes and safeguard the wellbeing of vulnerable people living in exempt accommodation in Birmingham.

The report estimates that local authorities are spending up to £1 billion on exempt accommodation – a significant cost to the taxpayer. Despite these vast sums of public money being spent in the sector, the report also found that there are a number of regulatory and legislative loopholes that allow unethical operators to boost their profit without providing the support that residents desperately need.

Most concerningly, Freedom of Information requests to local authorities presented in the report illustrate a distinct lack of oversight when it comes to the administration of enhanced housing benefit for this type of accommodation. A clear record of spending in the sector does not appear to be maintained by the Department for Work and Pensions.

As an elected representative, it is becoming increasingly clear through my incoming casework that exempt accommodation providers in my constituency of Birmingham Ladywood are failing to provide neither good value to the public purse nor positive outcomes for residents. The number of exempt units in Birmingham alone has doubled over the past five years, and I have long been campaigning for the Government to close loopholes in legislation and to introduce stronger regulation.

I have written previously, and you kindly responded advising that an NAO investigation was not possible at the time, but I wondered if you would reconsider in light of the findings in the Prospect Report and the significant amount of public money being spent in this sector.

I believe this issue is worthy of an NAO investigation and I look forward to hearing from you on this important issue.

Yours sincerely

Shabana Mahmood

Member of Parliament for Birmingham Ladywood