Communities and Local Government CommitteeWritten evidence submitted by the Communication Workers Union

Overview

1. The Communication Workers Union (CWU) is the largest union in the communications sector in the UK, representing over 200,000 employees in the postal, telecommunications and financial services industries. We welcome the Select Committee’s inquiry into the private rented sector and its call for evidence on this, with many of our members—particularly those in the youth section of the union—living in rented accommodation.

2. While the Committee is not considering the supply of housing in its current inquiry, as a preliminary remark, we would stress that there is a growing need for more affordable housing in the UK and we note that the Committee identified a gap in supply and demand in this area in its report, Financing of new housing supply, in April 2012.

3. The cost of accommodation and barriers to purchasing a property are significant issues for our members, particularly with wages across the economy having been squeezed in real terms since 2007 and banks being increasingly unwilling to lend. These issues are compounded by changes to housing and other benefits and the matters the Committee is considering in relation to the private rented sector need to be seen in this context.

4. In response to the Committee’s call for evidence, we have surveyed 150 CWU members—the majority of whom were under 35—asking them about their experiences of, and their views on, renting accommodation. This highlights a number of issues we believe the Communities and Local Government Select Committee should address in its inquiry.

5. Firstly, in relation to cost, the vast majority of our members consider renting accommodation of a reasonable standard in the area they live in to be expensive. The evidence we have collected also shows that those in rented accommodation can face significant increases to rent of more than 5%, with any increases normally being imposed by a landlord rather than agreed after discussion.

6. Secondly, it is common for tenants to have problems with the standard of accommodation they are renting, particularly with mould and damp or heating and insulation; however, when raising these with the landlord, our members rarely consider the response to be satisfactory.

7. Thirdly, our survey found there to be a low level of awareness among respondents of: schemes or bodies—such as the Deposit Protection Scheme—which offer legal protection to tenants; organisations which are potential sources of advice for tenants facing problems; and the rights tenants have.

8. And finally, our survey highlighted that a significant minority of tenants—around 20% of those we surveyed—do not have a written tenancy agreement and that, even where there is an agreement, one particular issue that is often unclear is the range and level of costs tenants will be liable for when moving out.

9. As an Annex to this submission, we include a report from one of our local representatives who has interviewed younger CWU members living in rented accommodation in his locality in the South of England. The report has been anonymised at the request of the participants.

Key Results of the Union’s Survey

Accommodation costs and levels of rent in the private rented sector

Affordability is a key issue for our members in relation to the private rented sector and in relation to accommodation more generally:

57% of those surveyed consider the cost of renting accommodation of a reasonable standard where they live to be expensive, with only 28% considering it to be reasonable or easily affordable.

In line with this, property costs in both rented and other forms of accommodation tends to take up a significant share of our members’ income: over 37% of respondents told us that they were spending more than 40% of their net take-home pay on rent or mortgage costs.

Our members have also highlighted affordability as a broader issue in relation to accommodation, in particular citing difficulties in securing a mortgage or paying a deposit. A number of them tell us that they are living with their parents or are sharing because they cannot afford to buy.

Together with the perception that renting a reasonable standard of accommodation is expensive, the responses we received from our members showed they can face significant increases to rent at their landlord’s behest:

in almost half of the increases reported to us the last rise was of more than 5%; and

in 62% of cases the increase was imposed by the landlord. The landlord had agreed an increase after a discussion with their tenants in only 17% of cases.

Standard of rented accommodation

While our survey showed that, on the whole, the standard of rented accommodation was not considered to be poor, of those currently renting 64% had experienced a problem with the standard of their accommodation in the past.

Of the problems reported:

“Mould and damp” and “Heating and insulation” were by far the most common and had both been issues in 78% of cases; and

problems with electrics, general disrepair, appliances, plumbing and the standard of the kitchen or bathroom were also common, having all been issues in over 40% of these cases respectively.

Where there had been a problem 93% of respondents had raised it with their landlord. However, the response was deemed to be unsatisfactory in 60% of cases.

Awareness of rights/assistance

Of those we surveyed in rented and other accommodation, there was a low level of awareness of tenants’ rights or organisations tenants could go to for assistance.

67% of respondents were not aware of any the following schemes or bodies offering protection for tenants:

the Decent Home Standard;

the Deposit Protection Service;

the Housing Health and Safety Rating System;

MyDeposits;

the Dispute Service;

the Rent Assessment Committee;

the Residential Property Tribunal;

the Right to Repair Scheme; and

the Private Rented Housing Panel.

Only 21% of respondents had heard of the Deposit Protection Service—the fact that this was the highest score for any of the above bodies, underlines the low level of familiarity respondents had with these.

We also asked members which organisations they were aware of as potential sources of advice for tenants:

there was a very high level of awareness of Citizens Advice—83% of respondents knew that they could go to Citizens Advice for help if they had problems in relation to rented accommodation; and

however, the picture was mixed for other sources: only 51% of respondents were aware of the Directgov website (as it was formerly known—now part of GOV.UK), and only 45% were aware of their local Council, as a potential source of advice.

In relation to tenants’ rights, again there were mixed levels of knowledge of these among respondents.

60% were aware that tenants have rights to get certain types of repairs carried out by the landlord. This was the most widely recognised right, yet a significant minority of respondents was not aware of this.

40% of respondents were aware that tenants have certain rights to control their home to prevent entry from others (including the landlord)—again, a significant minority was not aware of this.

Fewer than 30% of respondents were aware of any of the following rights of tenants:

to have their deposit placed in a government approved scheme;

to remain in their home until the landlord gets a court order for eviction;

not to have their rent increased until the end of a fixed term (with a fixed term tenancy); and

to challenge a rent increase.

Other issues

Our survey raised two other issues the Committee should be aware of for tenants:

39% of those in rented accommodation said their tenancy agreement did not make clear what cleaning, inventory or check out costs they would be liable for at the end of their tenancy; and

in 20% of cases those in rented accommodation said they have no written tenancy agreement.

Conclusions From our Survey

10. There are a number of issues which come through clearly from the survey of our members. Firstly we believe there is a need for more publicity to be given not only to rights of tenants, but organisations which provide assistance or information for them. It is particularly surprising that almost 80% of respondents to our survey were not aware of the Deposit Protection Scheme and that 60% of respondents were not aware of tenants’ rights to prevent entry by others to the property.

11. However, it is apparent that all of the problems our members have experienced are not simply about awareness. Cost is a major issue when it comes to accommodation and a significant minority of respondents—37%—to the survey are spending more than 40% of their net take-home pay on rent or mortgage costs. When rent increases of over 5% are commonly imposed by the landlord without meaningful agreement this highlights a particular vulnerability of tenants and lack of security we believe the Committee needs to address. In particular, we would urge it to consider whether controls could be included within any licensing system for private landlords, of the sort introduced in Newham in January 2013.

12. We would also urge the Committee to consider this in relation to the standard of rented accommodation. It is notable that that over 60% of respondents currently renting had experienced problems with the standard of their accommodation and that, when raising this with their landlord, only 40% of them had considered the response to be satisfactory.

January 2013

Annex

CWU RESPONSE TO THE COMMUNITIES AND LOCAL GOVERNMENT SELECT COMMITTEE INQUIRY INTO PRIVATE RENTED ACCOMMODATION

For a majority of local young postal workers, benefits only seem to become an issue when they take holidays or are off sick for some time. The reason is that the great majority seem to be employed on 20 hour contracts even though they work a 40 hour week. For example, one individual was off work with a broken arm for several weeks, and found himself in debt very quickly. There are others however that will be directly affected with the new single bedroom housing benefit requirement in that if they are housed in a two bedroom flat they lose their housing benefit. For example, one individual who at present receives albeit a small housing benefit, has been advised that he will not only lose that small sum, but will be required to pay an extra £14 per week rent from this coming April.

I have no real figures to quote how many will be affected by cuts in their tax credits given individuals seem generally unhappy to discuss this. It may be that at present they are unaware as to how it will actually affect them.

I have had the opportunity to speak to a senior officer in a local Housing Association and am advised they are expecting a real increase in homeless young people over the coming months, and increasing problems faced by young people in receipt of housing benefit.

One young woman I spoke to who was prepared to discuss her situation lives with her partner and small son aged two years six months. Her partner is an apprentice cook, paid £3.50 an hour for a 30 hour week on the basis that he is an apprentice. She herself only works part time simply because if she worked full time, they would lose all their benefits and be financially worse off. Given her situation, like so many other young people in the town, they have little option to do otherwise.

Also in Townsville there is a hostel for young people who have faced real difficulties in their personal lives. All are on benefit, and have no other option than to remain as such especially given that Townsville is designated a deprived area and work in generally low paid and part-time.

Whilst others see Townsville as a thriving town this is simply due to the increasing demographic change in the town that has seen an influx of new, mainly wealthy retired residents from the South East of England. For the local young people mentioned, the reality is that if they took a job, they would not be able to afford the hostel flat they now live in, and they would certainly not be able to afford a local flat given local rent levels. Of course the other problem is that there is a dearth of one bedroom flats in and around Townsville.

There is of course the hidden young homeless that “sofa surf” around the town. I have asked for details from both individuals concerned and the manager of the hostel, but again they have been reluctant to make what they see as an official comment and sadly I feel that such is the position across much of the region.

I would add that “food banks” are now very much on the increase and those using it would in the main seem to be young single parents.

Again I apologise I could not convince any individual to be interviewed on-the-record. I did of course give an undertaking that any information would be in the strictest confidence, but my assurances were to no avail. In all respects I am sure that the information I have gleaned is mirrored across the country, but hope it is of some use to you.