Memorandum by the Department for Work
and Pensions (GTS 51)
The "anomaly" in the treatment of
Gypsy and Traveller sites within Housing Benefit (HB) exists because,
while sites provided by district, unitary and county councils
are widely considered to be "council sites", the HB
Regulations treat them differently. Gypsies and Travellers living
on sites owned by district councils or unitary authorities have
their site rent met in full because their site rents attract rent
rebates.
Powers in the Social Security Administration
Act 1992 provide that where rent is due to a housing authority,
a rent rebate is payable. As district authorities are also housing
authorities, district authority sites attract rent rebates. The
same goes for unitary authorities, which cover both county council
and district council functions. In these cases their site rents
are not subject to rent officer restrictions and HB can therefore
meet the eligible rent in full.
County councils are not housing authorities
and so their site rents attract rent allowances. Thus Gypsies
and Travellers who live on county council owned sites have their
site rent subject to rent officer restrictions. Gypsies who live
on sites which are privately managed, including those managed
by registered social landlords (RSLs) are also subject to HB restrictions:
their sites attract rent allowances, and thus are subject to rent
officer controls.
The HB Regulations are built on the premise
that the rent levels for social housing which includes local authorities,
RSLs and certain other tenancies are either regulated, or in some
other way controlled, often through subsidy, so that they are
lower than the market rent. However, in the de-regulated private
rented sector rent levels are not subject to any type of internal
rent controls.
Therefore claims received from those in the
de-regulated private rented sector will generally be referred
to the local Rent Officer by the local authority for a rental
valuation to determine the HB claim. The Rent Officer will look
at the level of rents within the neighbourhood as well as in the
wider locality. Any subsequent restriction in the rent used to
calculate Housing Benefit will reflect a reasonable rent for suitable
accommodation of the appropriate size within the locality.
For the purposes of the local reference rent,
rent officers are required to look at the highest and lowest rents
which the landlord might reasonably be expected to obtain for
private residential caravan/mobile home sites in the locality.
In doing so, the rent officer disregards those rents which are
unreasonably high or low. The local reference rent is the mid
point between these two values. In essence, a locality is a broad
area which reflects the generality of the market.
In comparing site rents, Rent Officers are required
to include local private residential caravan/mobile home sites
offering the same amenities and security of tenure in their valuation.
As they are also required to specifically exclude the influence
of HB on the market, Local Authority sites are not included as
they are HB led. However, it has become evident that, for a number
of reasons, site rents on district and unitary LA Gypsy and Traveller
sites are substantially higher than those charged on comparable
private residential caravan/mobile home sites.
We have come under increasing pressure to address
the issue of the anomaly in treatment of Gypsy and Traveller sites.
In order to work up a set of proposals we need relevant information.
However, data is not currently available on site rent levels throughout
the country, nor do we know how site rents are made up. We have
recently commissioned a research project to look at how the current
arrangements are working and consider the feasibility of a single
set of HB controls to apply to all gypsy sites. We aim to get
this project up and running later this month, and expect it to
be reporting next spring.
We will be looking at the way that the HB rules
operate for gypsy sites for the following reasons:
— County council and district council
sites, both of which are effectively "council owned"
are treated differently for HB purposes—this anomaly becomes
even more marked in the case of unitary authorities which encompass
county council functions.
— There are currently no HB controls
for "rent rebate" site rents so there is effectively
no control on rents for Local Authority sites.
— Gypsy site rents will not be included
in the Local Housing Allowance arrangements as they are not part
of the conventional market; thus there is a need to look at the
rules for these sites in the context of HB reform.
Whilst any change to the HB rules should clearly,
deliver appropriate expenditure controls, we are aware of the
fact that they should not undermine the wider Government policy
to provide incentives for Gypsies to use authorised sites.
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