Examination of Witnesses (Questions 720
- 739)
TUESDAY 19 JUNE 2007
MR MIKE
DAILLY, MS
SUSAN MCPHEE,
MR JOHN
PATTON, MS
LORETTA GAFFNEY
AND MR
CHRIS MALLON
Q720 Mr Davidson:
Can I clarify that. If the court costs are not charged to the
person who is in court, are they then falling on the other rent
payers? They do not presumably just disappear?
Mr Dailly: You are quite right,
they do not just disappear, but I think the point I am making
is because these figures are "judicial expenses", then
effectively it is based on employing a private lawyer who is going
to charge and make a profit and pay for the costs of their overheads
and so on and so forth. The reality is a lot of large social landlords
have in-house lawyers, so what I am really suggesting to you is
the reason that Fife can do it is clearly it is not costing them
£300 just to take someone to court. You are absolutely right,
I appreciate that somebody has got to pay for it, but because
it is not costing that amount, why should you make a profit when
people are in that situation, if we are talking about public sector
organisations?
Q721 Ms Clark:
You say that you have dealt with quite a number of eviction cases,
so in your experience, what happens to people who are evicted?
Mr Dailly: In the vast bulk of
cases we stop people getting evicted, but there are sometimes
cases where it is impossible because people will not stick to
the agreed repayment plan and the arrears keep going up, and the
sheriff will grant a decree and that is very difficult. What happens
to all these people in Scotland? Would you believe it, they end
up going from the social rented sector into the private sector.
The difficulty with the private rented sector in Scotland is there
are two types of private sector: there is the nice private sector
which is nice flats that some students might be able to afford,
professional people, fair enough; then there is the other private
sector which is absolutely abysmal, where people have got rat
infestation, dampness, the windows nailed down so they cannot
get any ventilation. We see these cases in Govan day-in day-out
where the people we are dealing with are effectively blacklisted
from getting on to housing association houses, so they are stuck
in that sector. There has been some work done on this by the Scottish
Executive and I think there is more scope for us to be able to
challenge that, but that is what happens to people, ultimately
they end up going into pretty grotty private lets.
Q722 Ms Clark:
You say this mainly happens to people who do not make their repayment
plans. In your experience, do local authorities and housing associations
discriminate between people who cannot pay, their circumstances
are that they are just not able to pay the reasonable repayment
plan or people who just will not, who are not co-operating?
Mr Dailly: Some landlords do and
some do not. For example, in Govan you have got some very genuine
housing associations. When I say genuine housing associations,
I mean they are of a size with a management committee made up
of local people, there is that kind of genuine community spirit.
For example, there are housing associations in Govan where even
when they get a decree, it then goes back to committee for the
committee to decide, "Are we really going to make this family
homeless?", so people get a lot of opportunities. Then you
juxtapose that with the Glasgow Housing Association which really
has no community spirit about it at all. I would say to you that
since stock transfer in Glasgow things have got significantly
worse. The stock transfer process in Glasgow has resulted in increased
poverty, not just because more people are being evicted and they
do not do that differentiation which you are talking about, but
the other thing the Glasgow Housing Association has done is because
it is a factor to 28,000 homeowners it has got a policy whereby
if you cannot service the debts due to the GHA within a year they
are going to take you to court. Their excuse for that is it is
a charity law rule, which I would go on the record and say is
absolute nonsense. It seems to me that we have organisations getting
public funding that are actually causing homelessness and causing
misery in this city.
Q723 Chairman:
I am bit concerned about that. Obviously Glasgow City Council
had a debt of £1.1 billion to central Government and 55 per
cent of the rent used to go to pay off some of the debt. That
debt has been written off and you are telling me the situation
has gone from bad to worse. There must be something wrong somewhere.
Mr Dailly: The GHA has had something
like £700 million of public subsidy, it is remarkable, it
is probably more than any other registered social housing in the
UK, and they are also able to draw up to £1 billion of private
finance. Yet I would say to you, here in Govan, if you look over
to Ibrox Stadium where there are lots of multi-storey properties,
I have got clients living in there whose children are wheezing
and are literally exposed to asthma attacks because they have
got such problems with dampness. The Glasgow Housing Association
has left those people in those intolerable conditions since they
took over in 2003. The Council had an excuse because the Council,
as you rightly say, Chairman, had no money and all this money
was going to service historic debt, that does not happen anymore.
Why do we have people living in misery in this city? It is thousands
of people, literally it is a scandal.
Q724 Mr MacNeil:
Is that not the culture of the GHA? Is there not something wrong
with the management of the GHA that was not there when it was
the council?
Mr Dailly: With the Council, at
least if you were not happy there was a democratic institution
whereby you could change it via electing a different councillor.
That was something which was good and wholesome. With the GHA,
you are quite right, the problem we have got is the managing structure
is such that the Chief Executive has now left. His only accomplishment
in the last three years was to double his salary to £200,000
and he has since left to go to Australia.
Q725 Mr MacNeil:
Are you saying that the GHA and Glasgow housing should be taken
over again by the council?
Mr Dailly: Yes, I am sympathetic
to that, absolutely, but it is like saying, "Can we nationalise
all the industries again?" Financially it is probably not
possible, but I would like it in an ideal world. For the GHA,
the Scottish Executive has got powers under the Housing (Scotland)
Act 2001 to put statutory appointees on the board. One of the
things I would like to see is an amendment to the Freedom of Information
Act in Scotland which could be done by a statutory instrument
so that the GHA are added on to it, so we can then do FOI on the
GHA so that we can really hold them to account. I sincerely say
to you, and as the Chairman has said, they have had all this money,
yet why are things worse? It is incredible.
Q726 Mr MacNeil:
You are saying that the money given to the GHA has been mis-spent
public money and they should have maybe written the debt off,
end of story?
Mr Dailly: Absolutely. I think
it has been mis-management on a grand scale.
Q727 Mr MacNeil:
From Government?
Mr Dailly: No, mis-management
by the Glasgow Housing Association. It could have worked, I suppose,
if you had got the right people running the show, but it has not
worked.
Q728 Mr Davidson:
In your memo, Mike, you suggest that housing benefit forms could
be going back via job centres. This whole idea of a one-stop-shop
for benefits advice, combining the two, all of it, how much mileage
is there in that, and what stops that being done at the moment?
I would be interested to hear from CAB as well whether or not
you think a one-stop-shop approach would make much of a difference
to the real difficulties which people face.
Mr Dailly: Very quickly, in terms
of what I have said, I do not think we need to go so far as having
the council services put into the same office as the DWP, that
is possible, of course. I think there is an easier solution, that
is when somebody goes in to claim, they get a pack from the job
centre and in that pack there is a housing benefit form, but the
job centre are not interested in you filling that in because that
is not their concern and that results in what happens which is
people really want to get the benefit because they need something
to live on. They fill in the form they need to fill in, they go
away with the housing benefit form, typically, not thinking that
they need to fill it in, until they then get taken to court for
rent arrears and we then have to do backdated claims and this,
that and the other, and that can be difficult. An easy solution
would be for the job centre and the DWP to then say to people,
"Fill in this housing benefit form which is in your pack
and give it to us and we will send it to the council". I
think that would stop a lot of people getting into rent arrears
in a way that we could easily tackle from a small adjustment.
Q729 Mr Davidson:
If this is so easy why has it not been done then?
Mr Dailly: A lot of things are
easy in life that are never done.
Q730 Mr Davidson:
Why is this particular easy idea not being done? Has it been raised
with the DWP?
Mr Dailly: I do not move in those
circles.
Q731 Mr Davidson:
It is a fair point, if they have not been asked to do it, then
it is unrealistic to attack them for not having done it.
Mr Dailly: I did not say I was
attacking them.
Q732 Mr Davidson:
Noising them up then.
Mr Dailly: Not even that, it is
just a helpful suggestion. I think the problem in the UK is we
do not have joined-up departments, we do not. If I put this to
the DWP I doubt it would get high enough up the line for anybody
to take notice of it. I think this Committee is in an ideal position
to deal with that.
Q733 Mr Davidson:
I am sure the Chairman can manage all that. Is this the view of
CAB as well that this is an issue or have you not come across
it yet?
Ms Gaffney: It is not as much
of an issue certainly in Easterhouse as Mike has obviously found
it, but I would agree that if you can have it all filled in in
the one place, the DWP or otherwise, that is going to be helpful.
In terms of housing benefit, our difficulties with housing benefit
is more in terms of when the housing benefit asks the claimant
for more information, sometimes that information does not come
back to them and they close the case.
Q734 Mr Davidson:
Sorry, what certain information do they ask for?
Ms Gaffney: That might be about
income, any information which they feel they require to make a
decision on a benefit claim. Sometimes from the client's point
of view, maybe they think they have sent it in or they think they
have given it to them, whatever, and they have not and the housing
benefit will close the case. What they should do is write to the
person and say they have made a decision on the case which is
a nil decision and they can appeal that. If they just close the
case and do not do that, then it just rolls on for more and more
rent arrears for the individual. It is more issues like that which
we are dealing with rather than people forgetting to claim.
Q735 Mr Davidson:
Has CAB raised this as a policy, again, with housing providers
or with presumably COSLA, sorry, it would not be COSLA now, would
it, it would be the Scottish Administration since it would be
all housing associations and so on. Has this been raised with
them?
Ms Gaffney: We have certainly
raised it with the housing benefit section in terms of them making
decisions.
Q736 Mr Davidson:
What has the response been?
Ms Gaffney: I think it is about
individual members of staff and they know that is exactly what
they are supposed to do and sometimes it falls down. They are
ongoing discussions that we are having with the housing benefit
section. Sometimes it works for a while and sometimes it does
not.
Q737 Mr Davidson:
Can I ask about property factors, the way in which they operate
in Scotland. Is this a matter of changing the contractual relationship
between factors and their customers or changing property deeds?
I think this is mainly from the submission you have given us.
Mr Dailly: Yes. If we are looking
at private sector factors, something like a third of all households
in Scotland may well need a factor because that is the proportion
of tenements. In all of the big cities where we have got a lot
of tenements, like Glasgow, Aberdeen and Edinburgh, you do need
a factor and typically that is a private company. The difficulty
there is these companies are by and large unregulated. If you
go down to the Debtors Court or Glasgow Sheriff Court you will
see these guys, they are the ones who are basically suing people
at a rate of knots who are their own customers. What they do as
well, just to give an example, you have a debt of £50 due
to the factor, your management fees are maybe £8 to £10
a month, what they will do for you is get the close cleaned, get
the grass cut in the garden, that kind of thing, and they charge
on top of that a management fee of, say, £10. A lot of them
have a scam going on whereby when you are due to pay that bill,
if you do not pay it instantly they start sending you letters,
and they have written into their terms and conditions a clause
which says, "We can send you a letter every five days".
I have got cases where people from all over Glasgow have got £1,000
or £2,000 of debt and the bulk of that debt, believe it or
not, is from these letters, which work out at £7.50 when
you add on the VAT. Because these private factor companies are
unregulated, over the years they have been in a position where
they have been able to operate this scam. I know it is of great
concern to Glasgow City Council's Trading Standards Department
because we speak to each other on this.
Q738 Mr Davidson:
Is this a Westminster issue or is this a Scottish Administration
issue?
Mr Dailly: It is a Scottish Administration
issue. Interestingly enough, I have worked to draw up a Bill proposal
for Gordon Jackson, which obviously the consultation is still
going on for, so hopefully another MSP can pick that up in the
Scottish Parliament because anybody could just say, "We will
take that proposal forward". The idea of that Bill was to
have a property factors register so that we could then have minimum
standards.
Q739 Mr Davidson:
To be fair, while I think it is helpful for us to be aware of
that, it is not directly an issue for us as a Westminster Committee
and, again, we note the disappointment that in the six weeks it
has not been resolved yet! The next point I have got to raise
with you, again the question of the Govan Law Centre, is the issue
about the Glasgow Housing Association not accepting payments spread
over 12 months. I understand that set of issues but, again, is
that an issue for us or is that an issue for the Scottish Administration
which it has not dealt with?
Mr Dailly: Interestingly enough,
I was quite concerned to hear from the Glasgow Save our Homes
Campaign Group, I think Nicola Sturgeon MSP was saying there was
nothing which could be done about this and I was quite concerned
about that. The GHA's policy is this thing that if you cannot
pay a bill within 12 months then you have got to borrow the money.
With a lot of these bills we are talking about a lot of people
who are pensioners.
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