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Memorandum submitted by UNISON (H&R 12)
Briefing and amendments Overview UNISON welcomes the Government's target of building of 2 million new homes by 2016 and 3 million by 2020, and the commitment to a significant increase in the number of new social rented and low cost ownership homes. The Housing and Regeneration bill is an important component of the package of legislation and other measures that will be required to deliver on those targets. The bill will establish a new homes and communities agency, which will bring housing and land regeneration responsibilities that were previously carried out by the Housing Corporation and English Partnerships into one organisation. The bill will also result in a new social housing regulator, responsible in the first instance for homes provided by registered social landlords, and create opportunities for local authorities to reach agreement with the Secretary of State to move some or all of their properties outside the housing revenue account either for a fixed period or indefinitely. The Government argues that this latter measure has the potential to allow local authorities greater freedom to build new council homes.
However, whilst overall, the bill is a positive step forward, there are a number of barriers that need to be overcome if the Government are to realise its' aspirations of a significant increase in the supply of social rented and affordable housing, mixed and sustainable communities and decent homes.
Set out below are the areas where we believe the legislation can be improved and or/clarified along with suggested amendments.
UNISON does note that since the publication of the Bill the Housing Minister has made a number of further announcements that will have a significant bearing on the overall policy aim of achieving a major expansion of affordable homes and the creation of mixed and sustainable communities. These include the welcome announcements that the government will carry out reviews of the housing revenue account and the private rented sector. This briefing also makes reference to these developments, where it is believed there would be value in seeking clarification about how they will work and interact with the measures in the bill during the current legislative process.
Role of local authorities Although the Government have said that they want to make it easier for local authorities to build new council homes, and that the pressing need for new homes means that disincentives need to be removed, the current package could be improved.
UNISON values public housing and believes that the achievement of the Government's wider objectives in health, education, addressing child poverty and climate change require a vigorous contribution from public housing.
The Government's target to provide an additional 3 million homes places significant responsibility for the delivery of its objectives on the private sector.
UNISON is concerned that the Government's objectives may not be realised, as developer's timescales and priorities are not always consistent with those objectives. Recently published figures from Communities and Local Government suggest that over the next 15 years HRA surpluses (that will accrue to the Government) will amount to some £7.5bn. The availability of these resources ought to enable a) maintenance allowances within the HRA subsidy system to be significantly increased to more properly reflect the findings of the Building Research Establishment and b) the introduction of an additional allowance for new build within the HRA susbsidy system.
We believe that removing further barriers to new build by local authorities can, in addition to providing a much needed expansion of social rented housing, help guarantee a significant proportion of the overall target. Appendix one demonstrates the decline of local authority new build and, we would argue, the scope for growth.
As it currently stands the bill will, to use the words of the Bill's impact assessment, only 'increase LA new build from a few hundred a year to several thousand, including a mix of social rent low cost home ownership and market sale'.
Although the Housing Minister has announced a welcome review into the housing revenue account, we believe there will be value in establishing a clear aspiration for a far more significant share of new social rented homes for direct provision by local authorities during the bill's legislative stages.
In relation to Decent Homes, steps are needed to respect the democratic will expressed by tenants to remain as council tenants. Local authorities should be enabled to both achieve the Decent Homes Standard and have sustainability going forward.
UNISON is therefore promoting the following amendment to the Bill:
Clause 269
Replace current heading of clause 269 with
Subsidy arrangements - formula and exclusions
Add new subsection (1) as follows
Local Government and Housing Act 1989, insert section 80(3)A:-
80(3A) In determining a formula for the purposes of this section for any year, the Secretary of State shall take into account a) the resources required to properly manage, maintain and repair houses and other properties within their respective Housing Revenue Accounts paying due regard to the recommendations of relevant research into those matters and b) the resources required that enable respective authorities to acquire, rehabilitate, or build new housing to be held within their housing revenue accounts that contributes to meeting the need for affordable housing within their respective areas.
Renumber current (1) as (2), (2) as (3) and (3) as (4)
Profit making registered social landlords The bill provides for both 'not for profit' and 'for profit' organisations to be registered as social landlords under the new regulator. Whilst we recognise the valuable work that housing associations are able to carry out on the back of cross subsidy, we are concerned that these provisions of the bill will lead to existing RSLs becoming profit distributing companies whose reliance on financial markets will distort their priorities. Delivering profits for shareholders off of the back of a broad range of housing provision (including an increase in market operations) will become their priority, instead of the delivery first class social rented housing to tenants.
UNISON is therefore promoting the following amendment to the Bill
Clause 111
Insert second sentence to subsection (9) as follows:
'A non-profit making organisation may not change its status to a profit making organisation'
Affordability and definition of social housing We note that the bill designates two types of housing as social housing: low cost rental accommodation, and low cost home ownership accommodation. In both cases the accommodation is to be defined in relation to its cost below the market rate and rules for eligibility designed to ensure that it is made available to people who can not afford to buy or rent at market rate.
We understand that there is likely to be an amendment which makes clear that this clause does not open the door to means testing. But defining social housing in relation to its cost being below the market rate leaves open the possibility of homes being defined as social housing whilst only being marginally cheaper than the market rate. Given the inexorable rise in house prices relative to wages growth, we believe that the Bill's definition of social housing needs to be underpinned by a clear and rigorous shared understanding of affordability that takes full cognisance of the growing number of people who struggle to buy or rent.
UNISON is therefore promoting the following amendments to clauses 67 and 68, which seek to reference social rented and low cost home ownership to an affordability formula - i.e that they are affordable to people on low incomes - and give legislative expression to the aim of creating mixed and sustainable in the context of limited supply.
Clause 68
Low cost rental
Delete current (b) and replace with new (b) as follows:
'the rent is below the market rate to such an extent that it is affordable for those on low incomes'
Delete current (c) and replace with new (c) as follows:
'the accommodation is let in accordance with rules for eligibility designed to give preference to people in housing need whilst also promoting the concept of mixed and sustainable communities'.
Clause 69
Low cost ownership
Delete current subsection (3) and replace with new (3) as follows:
'Condition 2 is that the accommodation is affordable for those on low incomes and made available in accordance with rules for eligibility designed to give preference to people who can not afford to buy or rent at market rates whilst also promoting the concept of mixed and sustainable communities'.
Although we understand that the notion of low income itself requires further clarification in rules, we think these amendments will provide greater legislative clarity and direction than the 'below the market rate' formula.
Tenant engagement The Bill will establish a new regulator for social housing, to be known as Oftenant, and provides a power for the regulator to set standards that registered providers will have to meet in respect of the social housing that they own . UNISON notes that the standards that the regulator will be able to set under this power will include methods for consulting and informing tenants and for enabling tenants to influence or control the management of their accommodation and environment. UNISON believes that those organisations that are registered by the regulator should be subject to the provisions of the Freedom of Information Act and that as part of the registration process the regulator should satisfy itself that the organisation is compliant with the equality duties (see employment issues below).
The regulator should also be able to set standards in respect of the information that it should require registered providers to make available to tenants to enable them to influence or control the management of their accommodation and environment.
UNISON is therefore promoting the following amendment to the Bill:
Clause 173
Insert new (j) to subsection 2 as follows:
(j) the provision of any information to tenants as is necessary for them to influence or control the management of their accommodation and environment
Current (j) (k) (l) become (k) (l) (m) accordingly.
Transfer ballots UNISON notes the requirement for local authorities to ballot all affected tenants prior to transfer of housing to a housing association. It is not clear whether probationary tenants, or those with a family intervention tenancy will be eligible to vote. We do however believe that this welcome measure should be strengthened and broadened to ensure that there is a level playing field when ballots take place. i.e.:
· ballots also to be guaranteed when a group tenants request a transfer, as set out in clause 259
· ballots to be extended to proposals to transfer the management of housing to an Arms Length Management Organisation
· ballots to be required where a local authorities proposes to enter into a PFI contract that involves a change to the management of tenants homes
We believe that these matters can be addressed in a code of practice and broadly support the Defend Council Housing amendment on this matter (reproduced here in appendix one)
Employment issues UNISON also notes that there are employment related issues within the bill that should be addressed. The new rules for providers of social housing should include a requirement that they comply with the equalities duties and the section of the bill that relates to TUPE in cases of stock transfer should be strengthened in line with provisions for other local government workers.
UNISON is therefore promoting the following amendment to the Bill:
Clause 174
Replace 'may' for 'can' and after 'and other affairs' add
'and require providers to meet the requirements of the equalities duty.'
UNISON's legal team are currently developing an amendment to Schedule 6 dealing with the TUPE elements of the Bill. This will be provided shortly. Our aim is to secure the same protection as currently afforded by SI2006 / 246 and the best value code on work force matters in LA service contracts.
Sustainable Communities UNISON is concerned that the Government's strategy of developing sustainable communities is being undermined by the sales policies and practices of private developers. The practice of discounted bulk purchase arrangements either to private individuals, individual companies or to buy to let investors undermines the creation of sustainable communities because a) mixed tenure is not created as the tenure mix becomes one of social rented, shared ownership and private rented, b) stable communities cannot be achieved because significant proportions of the development are occupied by people on short term assured shorthold tenancies; c) community cohesion cannot be secured because of the unstable nature of the community and d) the management of these mixed tenure developments is often undertaken by organisations that have no experience or track record of managing such developments, have no links with public organisations that provide community leadership, are remote and unaccountable and often unable to manage multi-landlord developments.
UNISON believes that the Government needs to go further in the stated value it has placed on local authorities as place shapers and that this role should extend to a renewed emphasis on arrangements that secure the direct provision and management of public housing, albeit within mixed tenure communities.
We note that the review of the private rented sector will address some of these issues. However, we think there is scope to use the debates that occur as the bill makes its way through its legislative stages, to address these issues.
January 2008
Appendix one (source DCLG)
Appendix two (Source Defend Council housing)
Clause 257, page 102, line 14, leave out from "ballot" to "appropriate" in line 15 and insert "in accordance with the code of practice set out in section 257A" Clause 257, page 102, line 16 at end insert- "in accordance with the code of practice set out in section 257A" Consultation principles To move the following Clause:- (1) The Secretary of State shall by regulations under statutory instrument set out a code of practice to govern local authority consultations with tenants concerning a) a change of landlord, or b) a major change in the management of their homes. (2) These regulations shall include a requirement that the authority will- i) place in the public domain all relevant information concerning the resources available to the authority to spend on its stock, stock conditions surveys, the business plan of the proposed landlord, the transfer valuation, details of any land and property to be disposed of and any other information on which the Offer Document and transfer proposal is based. ii) ensure at the start of the consultation that all tenants are aware of their rights to access this information. iii) ensure that material is objective, balanced, informative, and accurate. iv) provide reasonable resources for any tenant group who serves written notice on the authority opposing a proposal so that they can put an alternative view to tenants. v) not to deny reasonable request from those in iv) above for lists of addresses and access to notice boards, meeting facilities and other relevant resources to enable all parties to communicate with those entitled to vote. vi) give two months advance notice of a) the start and end date of the ballot and b) how those eligible will be able to vote. vii) ensure that information regarding who has and has not voted at any point in time is treated in confidence."
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