(a) section 1;

(b) section 2;

(c) sections 4, 5 and 6.

(3) Sections 7 and 8(1) to (6) come into force—

(a) 5for the purposes of making regulations, on the day on which this Act is
passed;

(b) for remaining purposes, on such day or days as the Secretary of State
may by regulations appoint.

(4) Section 11 comes into force—

(a) 10for the purposes of making regulations, on the day on which this Act is
passed;

(b) for remaining purposes, on 6 April 2017.

(5) Sections 21, 22 and 24 to 31 and Schedule 2, so far as not brought into force by
subsection (1), come into force—

(a) 15for the purposes of making regulations, on the day on which this Act is
passed;

(b) for remaining purposes, on such day or days as the Secretary of State
may by regulations appoint.

(6) The remaining provisions of this Act come into force on such day or days as the
20Secretary of State may by regulations appoint.

(7) Regulations under subsection (3), (5) or (6) may—

(a) appoint different days for different areas;

(b) appoint different days for different cases or purposes.

(8) Regulations under subsection (3), (5) or (6) may make such transitional or
25transitory provision or savings as the Secretary of State considers necessary or
expedient in connection with the coming into force of the provisions to which
they relate.

(9) Section 176 of the Social Security Administration Act 1992 (consultation with
representative organisations) does not apply in relation to regulations under
30this section so far as relating to section 7 or 8.

(10) Regulations under this section must be made by statutory instrument.

35 Short title

This Act may be cited as the Welfare Reform and Work Act 2016.

SCHEDULES

Sections 9 and 10

SCHEDULE 1 Meaning of “the relevant sums” and “the relevant amounts”

1 The “relevant sums” for the purposes of section 9 are the sums—

(a) 5specified in paragraph 1 of Schedule 2 to the Income Support
(General) Regulations 1987 (S.I. 1987/1967);

(b) specified in paragraph 1 of Schedule 3 to the Housing Benefit
Regulations 2006 (S.I. 2006/213);

(c) specified in paragraph 25 of Schedule 3 to the Housing Benefit
10Regulations 2006 (S.I. 2006/213);

(d) specified in regulations under section 4(2) of the Jobseekers Act 1995;

(e) specified in paragraph 1 of Schedule 1 to the Jobseeker’s Allowance
Regulations 1996 (S.I. 1996/207);

(f) specified in regulations under section 2(1)(a) of the Welfare Reform
15Act 2007;

(g) specified in regulations under section 2(4)(c) of the Welfare Reform
Act 2007, so far as relating to the component under section 2(3) of
that Act;

(h) specified in paragraph 1 of Schedule 4 to the Employment and
20Support Allowance Regulations 2008 (S.I. 2008/794);

(i) specified in regulations under section 4(6)(c) of the Welfare Reform
Act 2007, so far as relating to the component under section 4(5) of
that Act;

(j) specified in regulations under section 9(2) of the Welfare Reform Act
252012;

(k) specified in regulations under section 10(3) of the Welfare Reform
Act 2012 in respect of an amount to be included under section 10(2)
of that Act (but where more than one sum is so specified, only the
smaller or smallest of those sums is a “relevant sum”);

(l) 30specified in regulations under section 12(3) of the Welfare Reform
Act 2012 in respect of needs or circumstances of a claimant
prescribed by virtue of section 12(2)(a) of that Act (but not in respect
of needs or circumstances prescribed by virtue of section 12(2)(b)).

2 The “relevant amounts” for the purposes of section 10 are the amounts—

(a) 35specified in Schedule 2 to the Working Tax Credit (Entitlement and
Maximum Rate) Regulations 2002 (S.I. 2002/2005) for the basic
element, the 30 hour element, the second adult element and the lone
parent element;

(b) specified in regulation 7(4)(c) and (f) of the Child Tax Credit
40Regulations 2002 (S.I. 2002/2007).

Section 25

SCHEDULE 2 Further provision about social housing rents

Part 1 Provision about levels of rents

5Tenancy of existing social housing

1 (1) This paragraph applies in relation to a tenant of social housing in England
if—

(a) the tenancy begins after the beginning of 8 July 2015, and

(b) the accommodation was social housing during the period starting
10with the beginning of 8 July 2015 and ending with the beginning of
the tenancy.

(2) This paragraph does not apply if paragraph 3 applies.

(3) The registered provider must secure that the maximum amount of rent
payable to the registered provider by the tenant in respect of—

(a) 15the first relevant year, where the tenancy begins before or at the
beginning of the first relevant year,

(b) the part of the relevant year falling after the beginning of the tenancy,
where the tenancy begins after the beginning of the first relevant
year and not at the beginning of a later relevant year,

(c) 20the following relevant year, where the tenancy begins as described in
paragraph (b), or

(d) the relevant year, other than the first relevant year, at the beginning
of which the tenancy begins,

is no more than would be payable if the tenant were paying rent at the higher
25of the social rent rate and the assumed rent rate in respect of that relevant
year or that part of a relevant year.

(4) The social rent rate, in relation to the rent payable by a tenant of social
housing in respect of the first or a subsequent relevant year, is the rate found
by—

(a) 30determining what would have been the rate of formula rent for that
social housing at the beginning of 8 July 2015,

(b) determining the rate of that rent when expressed by reference to a
period of 12 months (if necessary), and

(c) at the beginning of each relevant year (up to and including the
35relevant year in question), making a 1% reduction in the rate.

(5) The assumed rent rate, in relation to the rent payable by a tenant of social
housing in respect of the first or a subsequent relevant year, is the rate found
by—

(a) determining the rate of the rent that—

(i) 40was payable to the registered provider by the tenant of that
social housing at the beginning of the relevant day, in a case
where the relevant day falls after 8 July 2015 and the tenancy
that exists at the beginning of 8 July 2015 does not come to an
end before the beginning of that later day,

(ii) was payable to the registered provider by the tenant of that
social housing at the beginning of 8 July 2015, in a case where
the relevant day is 8 July 2015 or the tenancy comes to an end
before the beginning of a later relevant day, or

(iii) 5is likely to have been payable to the registered provider by a
tenant of that social housing at the beginning of 8 July 2015,
if there was not a tenant at that time,

(b) determining the rate of that rent when expressed by reference to a
period of 12 months (if necessary), and

(c) 10at the beginning of each relevant year (up to and including the
relevant year in question), making a 1% reduction in the rate.

(6) If—

(a) the tenancy comes to an end after part of a relevant year to which
sub-paragraph (3) applies has elapsed, or

(b) 15sub-paragraph (3)(a), (b), (c) or (d) ceases to apply in relation to the
tenancy after part of the relevant year in question has elapsed,

sub-paragraph (3) has effect in relation to the part of the relevant year falling
before that time with a proportionate reduction in the maximum amount of
rent payable to the registered provider by the tenant.

(7) 20The Secretary of State may by regulations define “formula rate”.

(8) Regulations under sub-paragraph (7) may, in particular, make provision by
reference to—

(a) standards issued by the regulator under section 194(2A) or 198(3) of
the Housing and Regeneration Act 2008 (the powers of the regulator
25to set and revise standards relating to levels of rent) providing for the
determination of social rents, or

(b) guidance issued by the Secretary of State relating to the
determination of social rents.

Tenancy of new social housing

2 (1) 30This paragraph applies in relation to a tenant of social housing in England
if—

(a) the tenancy begins after the beginning of 8 July 2015, and

(b) paragraph 1(1)(b) is not satisfied as regards the accommodation.

(2) This paragraph does not apply if paragraph 3 applies.

(3) 35If the tenancy begins before or at the beginning of the first relevant year, the
registered provider must secure that the maximum amount of rent payable
to the registered provider by the tenant in respect of the first relevant year is
the amount that would be payable by the tenant if the social rent rate applied
during that relevant year.

(4) 40If the tenancy begins after the beginning of the first relevant year, the
registered provider must secure that—

(a) the maximum amount of rent payable to the registered provider by
the tenant in respect of the part of the relevant year falling after the
tenancy begins, where the tenancy begins after part of a relevant year
45has elapsed,

(b) the maximum amount of rent payable to the registered provider by
the tenant in respect of the following relevant year, where the
tenancy begins as described in paragraph (a), or

(c) the maximum amount of rent payable to the registered provider by
5the tenant in respect of the relevant year, where the tenancy begins
at the beginning of a relevant year,

is the amount that would be payable if the social rent rate applied during
that period.

(5) If—

(a) 10the tenancy comes to an end after part of a relevant year to which
sub-paragraph (3) or (4) applies has elapsed, or

(b) sub-paragraph (3) or (4)(a), (b) or (c) ceases to apply in relation to the
tenancy after part of the relevant year in question has elapsed,

sub-paragraph (3) or (4) has effect in relation to the part of the relevant year
15falling before that time with a proportionate reduction in the maximum
amount of rent payable to the registered provider by the tenant.

(6) “Social rent rate” has the same meaning as in paragraph 1.

Tenancy of affordable rent housing

3 (1) This paragraph applies in relation to a tenant of social housing in England
20if—

(a) the tenancy begins after the beginning of 8 July 2015, and

(b) the accommodation is affordable rent housing (see paragraph 4).

(2) If the tenancy begins before or at the beginning of the first relevant year, the
registered provider must secure that the maximum amount of rent payable
25to the registered provider by the tenant in respect of the first relevant year is
the amount found by—

(a) determining the rate of the market rent for that social housing when
the tenancy begins, and

(b) determining the amount that is 80% of the amount that would be
30payable in respect of a year if that rate had applied during the year.

(3) If the tenancy begins after the beginning of the first relevant year, the
registered provider must secure that—

(a) the maximum amount of rent payable to the registered provider by
the tenant in respect of the part of the relevant year falling after the
35tenancy begins, where the tenancy begins after part of a relevant year
has elapsed, or

(b) the maximum amount of rent payable to the registered provider by
the tenant in respect of the relevant year, where the tenancy begins
at the beginning of a relevant year,

40is the amount found by determining the rate of the market rent for that social
housing when the tenancy begins, determining the amount that is 80% of the
amount that would be payable in respect of a year if that rate had applied
during the year and (if necessary) reducing that amount in proportion to the
part of that relevant year that elapsed before the tenancy begins.

(4) 45If the tenancy begins after the beginning of the first relevant year and not at
the beginning of the second or third relevant year, the registered provider
must secure that the maximum amount of rent payable to the registered
provider by the tenant in respect of the relevant year following the one in

which the tenancy begins is the amount found under sub-paragraph (2) or
(3) (disregarding the proportionate reduction) reduced by 1%.

(5) If—

(a) the tenancy comes to an end after part of a relevant year to which
5sub-paragraph (2), (3) or (4) applies has elapsed, or

(b) sub-paragraph (2), (3) or (4) ceases to apply in relation to the tenancy
after part of the relevant year in question has elapsed,

sub-paragraph (2), (3) or (4) has effect in relation to the part of the relevant
year falling before that time with a proportionate reduction in the maximum
10amount of rent payable to the registered provider by the tenant.

(6) The market rent is to be determined using a RICS valuation method.

4 (1) This paragraph has effect for the purposes of paragraph 3.

(2) Affordable rent housing is accommodation identified by regulations made
by the Secretary of State as accommodation that may be let as social housing
15at an affordable rent.

(3) Regulations under sub-paragraph (2) may, in particular, make provision for
identifying accommodation that may be let as social housing at an
affordable rent by reference to an agreement or arrangement relating to the
provision of social housing by a registered provider.

(4) 20Regulations made by virtue of sub-paragraph (3) may, for example, make
provision by reference to—

(a) an agreement relating to the exercise of a power under section 5 or 19
of the Housing and Regeneration Act 2008 (powers of the Homes and
Communities Agency as regards the provision of housing or other
25land and financial assistance);

(b) an agreement relating to the exercise of a power under section 30 or
34 of the Greater London Authority Act 1999 (general and subsidiary
powers of the Greater London Authority);

(c) an agreement between a local authority and the Secretary of State
30under section 11(6) of the Local Government Act 2003 (agreement
about capital receipts payable to the Secretary of State).

(5) The Secretary of State may by regulations define “affordable rent”.

(6) Regulations under sub-paragraph (5) may, in particular, make provision by
reference to—

(a) 35standards issued by the regulator under section 194(2A) or 198(3) of
the Housing and Regeneration Act 2008 (the powers of the regulator
to set and revise standards relating to levels of rent) providing for the
setting of rents at up to 80% of market rent in certain cases or
circumstances, or

(b) 40guidance issued by the Secretary of State relating to the setting of
rents at up to 80% of market rent in certain cases or circumstances.

(7) “RICS valuation method” means a method for determining market rent that
complies with standards for valuation published from time to time by the
Royal Institution of Chartered Surveyors.

Part 2 Exceptions, exemptions and enforcement

Exceptions

5 (1) Part 1 does not apply in relation to a tenant of social housing if—

(a) 5the accommodation is low cost home ownership accommodation;

(b) the accommodation is both low cost rental accommodation and low
cost home ownership accommodation (see section 71 of the Housing
and Regeneration Act 2008).

(2) Part 1 does not apply in relation to social housing of a registered provider if,
10where the registered provider’s interest in the property that consists of or
includes the social housing is subject to a mortgage—

(a) the mortgagee is in possession of the interest in the property or the
part of the property that includes the social housing, in the exercise
of the mortgagee’s powers to enforce the mortgage,

(b) 15a receiver has been appointed in relation to the interest in the
property or the part of the property that includes the social housing
by—

(i) the mortgagee, in the exercise of the mortgagee’s powers to
enforce the mortgage, or

(ii) 20the court, in connection with enforcing the mortgage,

and that appointment is in force, or

(c) a person has been appointed by the mortgagee, in the exercise of the
mortgagee’s powers to enforce the mortgage (including, in the case
of a floating charge which relates to the interest in the property, the
25power under paragraph 14 of Schedule B1 to the Insolvency Act
1986), to exercise powers that include a power to sell or otherwise
dispose of the interest in the property or the part of the property that
includes the social housing and that appointment is in force.

(3) If—

(a) 30a registered provider’s interest in property that consists of or
includes social housing was made subject to a mortgage, and

(b) the interest in the property, or the interest in the part that includes
the social housing, is sold or otherwise disposed of after the coming
into force of Part 1 by—

(i) 35the mortgagee, in the exercise of the mortgagee’s powers to
enforce the mortgage,

(ii) a receiver appointed by the mortgagee or by the court as
described in sub-paragraph (2)(b), or

(iii) a person appointed by the mortgagee as described in sub-
40paragraph (2)(c),

Part 1 ceases to apply in relation to that social housing at the time of that sale
or other disposal.

(4) In sub-paragraphs (2) and (3)—

• “mortgage” includes a charge or other security;

• 45“mortgagee” includes a person who is entitled to take steps to enforce
  a charge or other security.

(5) The Secretary of State may by regulations provide for Part 1 not to apply in
cases prescribed by the regulations.

(6) Regulations under sub-paragraph (5) may in particular make provision
about—

(a) 5tenants of a description prescribed by the regulations;

(b) tenancies of a description prescribed by the regulations;

(c) accommodation of a description prescribed by the regulations;

(d) accommodation which satisfies conditions prescribed by the
regulations, including conditions relating to the funding of its
10building or refurbishment;

(e) events of a description prescribed by the regulations.

(7) Regulations made by virtue of sub-paragraph (6)(a) may include provision
about tenants whose income exceeds, or whose household’s incomes
exceed, an amount prescribed by the regulations during a period prescribed
15by the regulations.

(8) Regulations made by virtue of sub-paragraph (6)(e) may include provision
about periods during a tenancy when the rent payable is temporarily
reduced or waived.

Exemptions

6 (1) 20The regulator may issue a direction mentioned in sub-paragraph (2) in
respect of a private registered provider if—

(a) the condition in sub-paragraph (4) or (5) is satisfied, and

(b) the Secretary of State consents.

(2) The directions are—

(a) 25a direction that Part 1 does not apply in relation to a private
registered provider specified in the direction;

(b) a direction that Part 1 is to have effect in relation to a private
registered provider specified in the direction as if paragraph 1(4)(c)
or (5)(c)—

(i) 30were omitted,

(ii) required the lesser reduction specified in the direction, or

(iii) required the increase specified in the direction;

(c) a direction that Part 1 is to have effect in relation to a private
registered provider specified in the direction as if—

(i) 35in paragraph 3(4), “reduced by 1%” were omitted,

(ii) paragraph 3(4) required the lesser reduction specified in the
direction, or

(iii) paragraph 3(4) required the increase specified in the
direction.

(3) 40The regulator may specify in a direction—

(a) the period during which it is to have effect, and

(b) the social housing in relation to which it is to have effect.

(4) The condition in this sub-paragraph is that the regulator considers that
complying with Part 1 would jeopardise the financial viability of the private
45registered provider.

(5) The condition in this sub-paragraph is that the circumstances of the private
registered provider satisfy requirements prescribed in regulations made by
the Secretary of State.

(6) The regulator may publish a document about the measures that the
5regulator considers could be taken by a private registered provider to
comply with Part 1 and to avoid jeopardising its financial viability.

(7) The Secretary of State may issue a direction mentioned in sub-paragraph (8)
in respect of a local authority if the condition in sub-paragraph (10) or (11) is
satisfied.

(8) 10The directions are—

(a) a direction that Part 1 does not apply in relation to a local authority
specified in the direction;

(b) a direction that Part 1 is to have effect in relation to a local authority
specified in the direction as if paragraph 1(4)(c) or (5)(c)—

(i) 15were omitted,

(ii) required the lesser reduction specified in the direction, or

(iii) required the increase specified in the direction;

(c) a direction that Part 1 is to have effect in relation to a local authority
specified in the direction as if—

(i) 20in paragraph 3(4), “reduced by 1%” were omitted,

(ii) paragraph 3(4) required the lesser reduction specified in the
direction, or

(iii) paragraph 3(4) required the increase specified in the
direction.

(9) 25The Secretary of State may specify in a direction—

(a) the period during which it is to have effect, and

(b) the social housing in relation to which it is to have effect.

(10) The condition in this sub-paragraph is that the Secretary of State considers
that the local authority would be unable to avoid serious financial
30difficulties if it were to comply with Part 1.

(11) The condition in this sub-paragraph is that the circumstances of the local
authority satisfy requirements prescribed in regulations by the Secretary of
State.

(12) The Secretary of State may publish a document about the measures that the
35Secretary of State considers could be taken by a local authority in order to
comply with Part 1 and to avoid serious financial difficulties.

Enforcement

7 The Secretary of State may by regulations make provision about the
enforcement of requirements imposed by or under this Schedule, including
40provision applying Part 2 of the Housing and Regeneration Act 2008 with
modifications.

Part 3 General

Regulations

8 (1) Regulations under this Schedule must be made by statutory instrument.

(2) 5A statutory instrument containing regulations under this Schedule is subject
to annulment in pursuance of a resolution of either House of Parliament.

Guidance

9 (1) The Secretary of State may issue guidance about determining, for the
purposes of paragraph 1(5)(a)(iii), what rate of rent is likely to have been
10payable by a tenant of particular social housing at the beginning of 8 July
2015.

(2) Registered providers must have regard to guidance issued under sub-
paragraph (1).

Interpretation

10 (1) 15In this Schedule “the relevant day”, in relation to social housing, means—

(a) 8 July 2015, or

(b) if the Secretary of State consents to the use of a different day (“the
permitted review day”) in the case of that social housing, the
permitted review day.

(2) 20A consent given for the purposes of sub-paragraph (1) may be a consent
given for a particular case or for a description of cases.