London councils have reported a significant overspend on their homelessness budgets, totaling at least £330 million for the financial year 2024/25. This overspend reflects a 60% increase from initial budgets and indicates a troubling rise in homelessness burdening local authorities. The gap between the cost of temporary accommodation and government subsidies has grown substantially, worsening the financial strain on boroughs. With the highest number of homeless individuals recorded in London, borough leaders are warning of potential bankruptcies if these challenges are not addressed.
London's councils have overspent on homelessness budgets by at least 330 million, warning of bankruptcy as costs surge beyond government subsidies.
The Ministry of Housing insists they are addressing homelessness, yet councils face a substantial funding gap that is increasing beyond reasonable budgets.
With the number of homeless Londoners now at 183,000, councils are now spending 4 million a day on temporary accommodation, leading to imminent financial crises.
Councils' legal obligations to provide temporary accommodation limit their ability to control spending, putting many at risk of issuing bankruptcy declarations.
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