BBC Panorama investigation finds private companies are extracting substantial profits from the UK's supported exempt accommodation system while providing minimal support to vulnerable residents.
The Department for Work and Pensions paid out £410m for supported exempt accommodation in Birmingham alone in the last financial year. Birmingham hosts more than 34,000 people in this system, more than 1.5 times London's total despite London's population being seven times larger.
Supported exempt accommodation was designed to house people with additional needs, including former prisoners, people recovering from addiction and women fleeing domestic abuse. The system is meant to provide housing alongside care, support and supervision.
Panorama found evidence that some private companies are using vulnerable people as what anti-poverty charity Narthex director Patricia Coleman-Taylor called "cash cows to generate income" that flows from the DWP into landlord pockets. Labour MP Jess Phillips, whose Birmingham constituency contains large numbers of these properties, described the practice as "an absolute catastrophe."
One specific case involved a woman named Alysha, who fled domestic abuse and lived in a shared house managed by Second City Support Ltd. She reported residents went eight days without heating or hot water when the boiler broke. Despite being a domestic abuse survivor, she said Second City provided no support with finding employment or other life rebuilding.
Panorama's investigation found that Dawson Housing, the registered provider, received £443 per week in housing benefit for Alysha's room and support, equivalent to £23,000 annually. Second City Support Ltd managed the property and delivered support. A sister company, Second City Housing Properties, bought the house for £191,000 in 2024 and sold it one year later for £410,000.
Both Second City companies are owned by Darren Davey. Panorama analysis of company records shows Davey paid himself £2.9m in dividends over three financial years, plus more than £900,000 in salary. Davey told Panorama his earnings must be considered across his wider business network and that attributing all income to supported accommodation "would be misleading."
Lawyers for Dawson Housing denied support was poor, saying regular in-person support was provided, though they acknowledged communications with Alysha fell below expected standards.
Panorama found hundreds of managing agents similar to Second City operating in Birmingham, many recruiting residents through social media accounts on TikTok, primarily targeting people on benefits in the city's poorest areas.