Memorandum by the Local Government Association
(LGA) (DHB 24)
The Local Government Association was formed
by the merger of the Association of County Councils, the Association
of District Councils and the Association of Metropolitan Authorities
in April 1997. The LGA has just over 500 members and represents
the local housing authorities in England and Wales. The LGA provides
the national voice for local communities in England and Wales.
Its members represent over 50 million people, employ more than
2 million staff and spend over £65 billion on local services.
HOUSING CONDITIONS
The LGA welcomes the changes to the fitness
regime. They will allow local authorities to better judge the
scale of problems in their area and will help them prioritise
their resources to carry out repair and improvements to maximise
the life of the housing stock in their areas. The application
of the enforcement regime, and the potential resource implications,
is an issue that we will wish to consider in more detail, not
because we necessarily have any problems with it but because it
will be very long and very technical and we would particularly
welcome local authority comments on the practical implementation.
Whilst we recognize the good intentions behind
the occupancy-based system in applying the Housing, Health and
Safety Rating System (HHSRS), our member authorities feel that
it is essentially flawed in that occupancy patterns are too fluid
both in terms of moves between properties and changes in family
size or other vulnerability indicators. It may also encourage
landlords to let to less vulnerable tenants.
There are concerns, particularly amongst low
demand pathfinder authorities, regarding the effect that the HHSRS
will have upon the usage of housing clearance powers. Clearance
will inevitably have to be a significant feature of the Pathfinders'
proposals if market re-structuring is to be achieved. Until now
local authorities have generally been able to use Section 289
Housing Act 1985 to regenerate designated areas of private sector
housing because there have been high levels of unfitness, and
the cost of remedying it has been high. The proposal within clause
56 of the Bill, which will amend Section 289, is expected to seriously
limit its future use for area regeneration. The clause varies
the application of the existing power by only allowing a clearance
area to be declared if there is one or more Category 1 hazard
in each dwelling.
Practitioners who are familiar with earlier
versions of the HHSRS feel that there is likely to be lesser incidence
of Category 1 hazards compared to unfitness, in groups of houses
being considered for clearance. There is also concern that whilst
the cost of remedying unfitness in a typical house may be high,
the cost of remedying one or more Category 1 hazard in the same
house may be relatively low. This will have implications for the
Neighbourhood Renewal Assessment that is used to compare different
options, and is likely to make it harder for clearance to be justified
when compared to renovation.
The impact of the HHSRS on housing regeneration
would be of little consequence if there were suitable alternative
powers available to achieve the same objective. The revision of
Section 226 Town and Country Planning Act by the Planning and
Compulsory Purchase Bill, and the existing provisions of Section
93 of the Local Government and Housing Act 1989, both offer the
potential to do this. However, the effective usage of these alternatives
depends on local authorities making a compelling case that clearance
is necessary for the "well being" of residents. Unfortunately
there is no established definition of "well being",
and any guidance that there is does little to reassure local authorities
who face the prospect of having to defend their decision at a
Public Local Inquiry.
LICENSING OF
HOUSES IN
MULTIPLE OCCUPATION
(HMOS)
The LGA warmly welcomes the proposal for introducing
a licensing regime to ensure greater protection for tenants in
Houses in Multiple Occupation so that higher standards of management
and maintenance can be more easily enforced. It is an issue on
which we have been lobbying for many years. The mandatory scheme
will help to ensure that 120,000 of the most vulnerable households
in the country will receive statutory protection and the discretionary
power allows authorities to extend that protection to a wider
group of tenants should the poor quality management and maintenance
of the properties so demand it.
In our view there is too much detail included
in the Bill on definition. The LGA feels that this would be better
set out in secondary legislation allowing for greater flexibility
if further amendments are required at a later stage. Enforcement
against self-contained flats is still a problem and definitions
need to be tightened up in this area. The LGA would also like
to see discretionary powers extended to include accreditation.
The Bill needs to make the link between HMOs
and fire safety regulations. A national set of fire safety standards
for HMOs is required along with greater clarity and consistency
on the lead role in enforcement. This should rest with the local
housing authority, which would work in partnership with the fire
authority to create a single enforcement package allowing this
to be achieved on a one-stop basis, making the system quicker
and more effective. The current system needs tidying up. For example,
fire authorities are responsible for hotels, but are unable to
enforce section 352 standards (Housing Act 1985—means of
escape in case of fire). The old Greater London Council (GLC)
system of agreed models of fire safety standards for different
models of HMO accommodation may provide the answer.
The LGA would also urge the Government to give
consideration to including sprinklers in fire regulation guidance
as an additional tool and consider a trade-off approach whereby
the installation of sprinklers could offset the failure to meet
fire regulations in other areas. A British Standards Institute
(BSI) definition of an approved sprinkler system would be helpful
and could be fed into fire safety standards.
Several questions need to be asked in relation
to licensing of HMOs that are not yet addressed in the draft Bill:
1. What is the licensing timescale for local
authorities?
2. Will there be a requirement for local
authorities to inspect premises before licensing or will owners
be required to self-certify?
3. Will there be a duty to monitor after
a licence is issued?
4. More clarity is required on where the
approved code of guidance, currently being produced by Warwick
University, will sit in terms of management regulations. Will
there be a reference to the approved code of guidance in the regulations?
5. Will there be a statutory duty for the
local authority to promote licensing?
Whilst it may embody a sound principle, the
idea that rent will not be payable on an unlicensed premises is
of some concern to Tenancy Relations Officers (TROs) who feel
that the tenant could become the target for landlord harassment
and possible eviction. A rise in homelessness and the attendant
resource implications for local authorities could be an unintended
by-product of this measure. The LGA will be consulting member
authorities further on this aspect of the Bill.
SELECTIVE LICENSING
In the longer term the LGA would like to see
the introduction of licensing for the whole of the private sector
but welcomes the proposals in the bill as a good start. The association
sees licensing as essential to encouraging regeneration in destabilised
communities with a range of social and economic problems, particularly
where bad landlords are linked to criminal and anti-social behaviour
generally. Good landlords have nothing to fear as the legislation
will help to create a healthier private rented sector within which
they can thrive and that will encourage tenants to rent.
We are especially pleased by the additional
potential to apply selective licensing in areas other than low
demand, where the local authority puts compelling reasons forward.
The behaviour of bad landlords is not restricted to low demand
communities. In areas where demand outstrips supply tenants can
be particularly exposed to bad practices. Anti-social behaviour
and landlord harassment can, and does, occur anywhere. It is not
an exclusive feature of low demand neighbourhoods. However, The
LGA is concerned that the ability for local authorities outside
of low demand areas to selectively licence private rented accommodation
is not sufficiently explicit in the Bill. The "conditions"
for selective licensing are contained in 82(2) where only reference
to low demand areas is made. Opportunities for authorities other
than those in low demand areas to selectively licence is contained
separate to this in 82(5) and appears to be quite vague. The explanatory
notes only refer to anti-social behaviour as a reason for taking
such action but problematic landlords can cause other problems
in high demand areas. The LGA has sought legal advice on this
and has been advised that the wording in the Bill would be better
termed as "A local housing authority may designate the area
of its district or an area in its district as subject to selective
licensing if it considers that either the conditions in subsection
(2) or conditions specified in an order pursuant to subsection
(5) are satisfied."
The availability of selective licensing to all
authorities would be preferable and the explanatory notes pertaining
to clause 82(5) should leave this provision open rather than just
focusing on anti-social behaviour as a reason to invoke this power.
There are plenty of authorities in high as well as low demand
areas that have large and problematic private rented sectors.
These authorities should be trusted to use these powers if it
was felt it would contribute to objectives devised as part of
its strategic housing role. This would be consistent with the
Government's commitment to increased freedoms and flexibilities
for local authorities and we do not feel that ODPM need to micro
manage this power by also requiring consent from the Secretary
of State before the designation comes into force (Clause 83).
Applying selective licensing in low demand areas
may well drive problem landlords and tenants into neighbouring
non-designated areas. This is a point that has been made in responses
to previous consultations. There is also a concern at the speed
at which areas can be designated—Local Housing Authorities
(LHAs) will be reliant on designation being confirmed by the Secretary
of State, and there will be a three month delay after confirmation
before licences can be required. Where clause 82(2) does not apply,
LHAs will have to rely on a ministerial order being made. Areas
can decline rapidly where there are problem landlords or tenants
and any undue delays may exacerbate low demand problems.
Whilst the LGA has accepted that licence fees
could be self-financing, more consultation needs to take place
with local authorities on whether the system should be fully self-financing
and if there is to be a cap on fees, how this should be determined.
If local authorities are to run self-financing schemes, they will
need to consulted extensively before any capped figure is determined.
Authorities will also need funding for start up costs.
INTERIM MANAGEMENT
ORDERS AND
FINAL MANAGEMENT
ORDERS
These are welcome provisions that will enable
the authority to take urgent action on individual properties should
the conditions prove necessary. This is required since the implementation
of licensing requires full consultation with relevant parties
before enactment. However, IMOs, as proposed, are an overly bureaucratic
substitute for control orders. Requiring local authorities to
go to the County Court before issuing an IMO will slow the process
down considerably, as will the requirement to seek the landlord's
consent to create a tenancy once an IMO has been issued.
The LGA would encourage ODPM to make the links
between Interim Management Orders and Compulsory Leasing. We would
like to see Compulsory Leasing introduced in the Bill in tandem
with IMOs.
HOME INFORMATION
PACKS
Although the LGA would welcome measures that
are likely to speed up the home buying and selling process, we
feel that the Home Information Pack is rather an onerous way of
achieving this and will be difficult to enforce as a civil sanction,
particularly as the seller has no duty to present the pack to
an authorised officer. From an enforcement perspective, it would
be simpler for the same rules to apply to all marketing in a consistent
way. With the advent of e-conveyencing it is likely that the buying
and selling process will become quicker without these measures.
The resource implications of enforcement are unlikely, in our
view, to yield sufficient results to constitute good value for
money. The LGA, therefore, does not support the introduction of
Home Information Packs.
If the pack is introduced, the housing market
renewal pathfinders are unlikely to welcome the options put forward
in the consultation paper to amend the rules on home information
packs for low demand areas, largely because it would serve to
blight these areas, further dampen-down prices and not deter speculators
from testing the market with no serious intention to sell. It
is acknowledged that the introduction of the pack in these areas
would help to raise awareness of property condition and, further,
if the Home Condition Report (HCR) could be linked in some way
to the decent homes standard by introducing a requirement to report
on the components of the decent homes standard as it applies to
social housing, it may help to build intelligence on property
conditions in the private sector and would provide a larger sample
than using the Housing Condition Survey. However, this is an issue
we would need to consult further on with member authorities and
it may also slow down the process and be more costly for the seller,
thus defeating the object of this proposed measure.
RIGHT TO
BUY AND
SOCIAL HOUSING
OMBUDSMAN FOR
WALES
The LGA welcomes the proposals. The changes
to the qualifying and repayment periods for RTB will ensure that
tenants are more likely to be committed to the property and in
a sustainable financial position. Authorities retain the discretion
not to require repayment in exceptional circumstances such as
illness or unemployment.
The LGA's fundamental position is that the Government
should amend RTB in line with the Right to Acquire for housing
associations tenants. In particular the Right to Acquire discount
entitlement should be applied in all authorities rather than the
recent change in 41 authorities only. This has the virtue of simplicity,
transparency and equality. It is also easily understood. In view
of the proposed move towards a single social tenure the two schemes
will need to be aligned at some point in any event. The current
situation presents a very confusing picture. In some areas tenants
could receive less than half the level of discount that tenants
living in properties of a similar size and type only a few streets
away will obtain. It also exposes the government to a requirement
to regularly review the evidence to identify whether authorities
should be added to or deleted from the group of selected authorities.
The LGA would also like to see the following
measures given serious consideration:
Suspension on properties scheduled for demolition/regeneration.
This would address the double subsidy abuse of tenants taking
up RTB and then receiving a home loss payment.
Requiring discount to be repaid if property sublet
within a specified period. Addresses the abuse whereby tenants
become landlords or hand property over to a lettings agency.
Right of resale to local authority. This will
allow authorities in high demand areas to have the option to buy
back a property, at full market value, for use of affordable housing
or keyworker provision.
Exclusion in rural areas with populations under
3000. This is in line with Right to Acquire.
Restricting who can be a named party on deeds
or mortgage to protect elderly tenants from unscrupulous relatives.
Requiring tenants to have a clean rent record
at exchange of contract. Ensures authorities do not have to try
and recover outstanding debt after purchase.
Placing a duty on local authorities to provide
advice on the implications of home ownership including repairing
obligations. Many tenants fail to take into account the fact that
mortgage payments, unlike rent, do not cover the cost of essential
repairs and maintenance. If they do not ensure sufficient provision
for these costs, then the properties may fall into disrepair or
the homeowner may suffer financial hardship.
Equity sharing arrangements to be offered in
addition to RTB. Tenants could build up credits that could be
used to either buy their own home or as a portable discount.
Requiring agents promoting RTB to include health
warning about the cost of their services and what is freely available
from the local authority. The results of recent ODPM research
indicate that some tenants find the services of these companies
helpful. However, it is not always clear that some services can
be obtained free of charge from the local authority.
Valuation to be fixed for three months and reviewed
every three months thereafter. Ensure local authority receives
receipt that more nearly reflects market price at time of sale.
The LGA and Welsh Local Government Association
(WLGA) are not opposed to the proposal to create a new Social
Housing Ombudsman for Wales, although we would like to ensure
that the proposals fit in with the overall review of the Ombudsman
service in Wales.
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