Westminster Council directs extra £200k to housing services

Westminster Council has approved an extra £200,000 to keep its housing transformation programme on track, as it battles soaring homelessness and demand for temporary accommodation.

The local authority said it needs a “one-off investment” to complete the transformation programme, according to a council report. The team, which has already cost £1.2mn, is responsible for establishing a new service delivery model, recommissioning contracts, and onboarding new staff.

The council is also forking out an extra £114k insourcing services like statutory decision-making for single homeless households and rent collection for temporary accommodation housing. It’s also needed to recommission prevention and wider support programmes, which the council has decided not to bring in-house.

According to the same council report, the cost is considered “broadly cost neutral” when compared to the current contract, which was last procured in 2017. Westminster City is also delegating responsibility for the day-to-day risk management of its temporary accommodation to a “specialist provider”, bringing the total spent to just shy of £4.1mn for Phase 2 of its housing transformation programme.

This phase focuses on establishing a “hybrid model” whereby the council continues to outsource some services while bringing others in-house. The extra funds were approved by Westminster City’s Labour cabinet on Monday 15 September.

The council will also transfer approximately 50 new staff into the council and is consulting with unions. The Local Democracy Reporting Service (LDRS) understands that while the council is fully committed to minimising any job loss, it is not in a position yet to confirm if any may occur as a result of the transformation programme.

Cllr Liza Begum, the cabinet member for housing services, said the council continued to face “significant and escalating” housing pressures marked by exceptionally high demand for temporary accommodation, rising levels of homelessness and a sustained shortage of affordable housing.

She said insourcing some housing services would allow the council to “move away from a reactive, crisis-driven approach and towards one that prioritises early intervention and prevention” in line with its Fairer Westminster policy.

She told councillors on Monday evening: “Reshaping our frontline housing solution service provides a vital opportunity to embed the voices and lived experiences of residents and community groups. Our aim is to provide services that are transparent, person-centred and collaborative, co-designing solutions with residents at critical moments of need.”

Approving the report, council leader Adam Hug said the transformation should improve outcomes for residents and help the council “keep better track of some areas of expenditure” going forward.

In July 2024, the cabinet approved a proposal to reshape the council’s housing solutions service. From April 2025, key functions such as frontline housing advice, homeless prevention and support, families pathway, and nominations and allocations, were brought in-house, with 110 staff transferring to the council.

Remaining services, such as the single homeless pathway and temporary accommodation management, continue to be commissioned until March 2026. The transformation programme consists of three phases. Phase 1, which was approved in July 2024, saw six services brought in-house. This was completed in April this year.

Phase 2, which the council is currently working on, looks to install a ”hybrid delivery model”, which will see some services brought in-house and others commissioned to the open market. This will run until March 2026.

Phase 3 will see new systems and structures developed in the council to support the new services.

According to the council, Westminster City has seen a dramatic rise in homelessness demand, with homeless applications increasing from 1,910 in 2021/22 to 3,856 in 2024/25, more than doubling in just three years.

Westminster Council, Cabinet, Monday 15 September 2025.

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