Council leaders have welcomed the announcement that supported housing will be funded through housing benefit.

The Local Government Association (LGA) said the decision will give councils the certainty to invest and sustain supported housing.

‘A sustainable funding model for supported housing is critical to ensuring councils can reduce homelessness and help older and other vulnerable people,’ said Cllr Izzi Seccombe, chairman of the LGA’s Community Wellbeing Board.

‘It is, however, crucial that councils have the leading role in overseeing and ensuring the provision of housing for vulnerable groups is good quality, value for money, and fits in with the wider local services offered in places.’

Housing minister, Kit Malthouse, said: 'Protection of the most vulnerable has always been our primary concern, and following our consultation, the case for keeping supported housing in the welfare system became clear.'

The Government also announced it would work with local authorities to develop a ‘robust’ oversight regime and would review housing related support.

David Orr, chief executive of the National Housing Federation, described the announcement as a 'hugely welcome decision'.

'After years of uncertainty, we are delighted that housing costs will remain in the social security system for all supported housing, sheltered and extra care,' he said.

'The sector has worked together to demonstrate the value of supported housing, ensuring the Government understood the need to protect these homes and services and put a funding model in place that would encourage future development.

'This announcement means that hundreds of thousands of people, many of whom are vulnerable, will continue to receive the support they need by right, through the social security system. It gives them the certainty and security they need and deserve.'