Birmingham’s supported exempt accommodation sector has been described as both a ‘cash cow’ and a state-sanctioned scandal — reshaping neighbourhoods while raising serious concerns over public fund usage.
BirminghamLive’s latest investigation uncovers how the city’s largest landlord network, managing over 5,000 properties, claims up to £400 a week in public money for every room filled by vulnerable benefit claimants. Most of this vast sum flows into the pockets of private landlords, agents, and investors, generating a £300 million annual industry linked to rising crime and conversions of family homes into shared Houses in Multiple Occupation (HMOs).
Currently, more than 32,000 individuals live in exempt accommodation across Birmingham, with many battling mental health issues or recovering from addiction. These often former family homes become shared spaces for a mix of vulnerable tenants, including ex-prisoners and refugees.
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City councillors are demanding an internal audit of Birmingham City Council’s housing benefits processes to identify potential fraud or system abuse. Local campaigners want a wider probe involving specialist auditors to fully “track the money.” Independent MP Ayoub Khan has secured an urgent parliamentary debate highlighting the issue.
BirminghamLive has monitored this sector for six years and found explosive growth. In 2014, Birmingham had just under 3,700 exempt accommodation claimants—similar to other major cities. By 2018, homeless claimants soared to nearly 12,000—three times higher than Manchester. Now, the city hosts over 32,000 claimants spread across more than 11,500 properties, many linked to global investors.
The dominant player is Reliance Social Housing CIC, which grew from a turnover of under £500,000 in 2019 to a staggering £135 million projected for 2024-25, with £94 million earned last year solely via housing benefits. Despite being flagged as ‘non compliant’ by the Regulator for Social Housing in 2021, Reliance continues operating while revamping governance.
Other key providers such as Ash Shahada, Concept, Sustain, and Windrush Alliance have also faced regulatory scrutiny for governance and financial standards. None meet Birmingham City Council’s voluntary Quality Standards from 2023.
Targeting those often excluded from mainstream housing—such as ex-offenders, addicts, and refugees—this sector is meant to provide a short-term, supported transition toward independent living. Housing benefit claims are assessed by Birmingham City Council on behalf of the Department for Work and Pensions (DWP).
Our data dives into streets like Markby, Preston, and Willes Roads in Winson Green, areas once ordinary family neighbourhoods that now host a heavy share of HMOs and exempt properties. Here, families report fear from drug-related violence and antisocial behaviour.
Of roughly 450 homes across these streets, 120 operate as HMOs with standard benefit caps around £341.58 per week per room. In contrast, 37 exempt properties housing 101 support claimants generate nearly £30,000 weekly in benefits—over £1.5 million annually.
Strikingly, rent claims vary widely by provider in identical properties. Reliance tenants claim an average of £395 weekly, significantly higher than Ash Shahada’s £254 or Concept’s £231. This discrepancy raises questions about consistency and oversight.
Reliance defends its rent levels, citing comprehensive cost calculations including maintenance, utilities, and services such as Wi-Fi. A spokesperson explains Birmingham’s status as a sector hub results from national demand funnelled into the city and regulatory differences between registered and non-registered providers.
The City Council asserts it operates a multi-disciplinary team tackling poor practices in supported exempt accommodation, enforcing inspections that address property standards, antisocial behaviour, and potential planning violations. These efforts have saved taxpayers £8.7 million by refusing unjustified benefit claims.
The Department for Work and Pensions recently praised Birmingham’s housing benefits service as a model to be shared nationally but acknowledges that stronger powers are needed to further combat substandard providers and raise sector standards.
Despite ongoing monitoring and collaborative engagement with regulators, critics insist the current system allows excessive rent levels and insufficient safeguards, urging urgent reform to protect vulnerable tenants and public funds alike.