Housing and Planning Bill

Written evidence submitted by Unit Eleven Housing Co-operative (HPB 141)

1.0 Purpose of this submission

1.1 This submission is to express the opinion of Unit Eleven Housing Co-operative regarding the Housing and Planning Bill.

2.0 Summary

2.1 Unit Eleven is a fully mutual housing co-operative, comprising 29 homes in Islington, ranging from one- to three-bedroom flats. These we manage on behalf of Network Stadium Housing Association and currently provide secure and affordable accommodation for 34 adults and 12 children.

2.2 Unit Eleven became registered with the Register of Friendly Societies in November 1996 (No. 28472R) using the Model Rules of 1994. In common with similar housing co-operatives we were set up to provide accommodation for local single people and childless couples on low incomes, who were homeless or in private-sector accommodation that was not secure, having no access to local authority accommodation, or sufficient funds for a mortgage. Our efforts over the course of these last 20 years have resulted in establishing a small-scale local community, and taking into account our previous management of short-life properties we have successfully provided housing for several hundred individuals.

2.3 The proposed legislation on Pay to Stay and Right to Buy will bring substantial difficulties for us in terms of administration and maintaining our present finely balanced situation, not to mention a possible future in which managing our housing stock becomes untenable and all the work put in to secure affordable housing for our tenants collapses.

2.4 Brief outlines follow concerning these difficulties together with our views on the potential impact of this iniquitous proposed Bill, both as it may affect individuals and the co-operative itself, considered from both the community and financial perspectives.

3.0 Pay to Stay

3.1 Within Unit Eleven rents at present range from £115 to £146 per week, for one-person one-bed flats up to three-bed family flats. On the basis of private-sector rented properties advertised today, this range would translate to £270 to £440, and furthermore, these would in every likelihood be unsecure tenancies in smaller and less well-maintained properties. This is equivalent to a rental range of £14,080 to £22,940 per year, in the context of a Bill proposing a threshold of salaries of £40,000 after which tenants would have to Pay to Stay. Even allowing for the idea of tapering this threshold figure, it is clear that people would have to be on a much higher income to be able to afford anything approaching market rents.

3.2 If the Bill is proposing that the £40,000 threshold will be based on the two highest earners within a household, in the case of our housing co-operative we have the example of a family consisting of two adults and two young children, with one wage-earner on about £35,000 and the other adult wanting to return to part-time employment, in addition to their current voluntary work with vulnerable women within a community health programme. This combined salary would exceed the threshold, meaning that (i) the rent would be subject to increase, and very likely beyond their means to pay for it, and/or (ii) this would act as a disincentive to seeking employment for the person wanting to, and/or (iii) their not being able to continue with their voluntary work within an essential community health project.

3.3 The members of Unit Eleven represent a diverse group of professions, although many are on a low income. As regards future letting of flats as they become vacant, 50% of the nominations come from the local authority, and as such we cannot foretell how the threshold will affect these future tenants, or our ability to manage these vacancies. Amongst our current tenants, 10% are in receipt of full housing benefit, which includes two pensioners.

3.4 If a Pay to Stay scheme were to be introduced, this would have to be administered by the housing worker employed by Unit Eleven, in order to respect data confidentiality. Beyond that, the introduction of such toxic legislation contradicts the ethics of housing co-operatives which typically operate on a voluntary basis, with members taking on work within the organisation and without regard to people’s earnings. (The worker’s role is both separate from and additional to this set-up.) Any legislation for housing co-operatives that is based on assessing the incomes of members is against the spirit of what we stand and work for, and is above all a gross invasion of privacy. It is also potentially an area open to confusion, for example, were tenants to be paying a different rent from their neighbours for identical properties with identical levels of service. This is clearly highly divisive, giving rise to bad feelings and working against the effectiveness of the co-operative as a housing body.

3.5 The implementation of such a scheme would increase the workload for the worker, thereby increasing our costs in paying for this, and is a totally unnecessary and thoroughly unhelpful piece of bureaucracy when efforts could be far better employed elsewhere in attending directly to housing needs.

3.6 As stated before, many of our members have contributed greatly over the years to the running and development of the co-operative, by way of voluntary unpaid work, chiefly as officers (i.e. Chair, Secretary and Treasurer etc.), plus policy writing and implementation and meeting/committee attendance. It would be extremely unfair to tenants who have contributed in this way if they were then required to pay a large rent increase, thereby ignoring their earlier work, and to the co-operative as a whole if these contributing tenants were to find themselves obliged to leave, thus compromising its effective running.

3.7 Over the years, as people have done voluntary work for the organisation, they have acquired skills and competencies which have enabled them to find work and to move on from welfare benefits. However, higher mandatory rents would reverse this process, acting as a disincentive to those who would aspire to better careers and possibly forcing people back on to welfare benefits.

4.0 Right to Buy

4.1 Unit Eleven Housing Co-operative was formed at a time when there were many empty properties in Islington and numerous people who were homeless or living in insecure private rented accommodation. Over the last 20 years, we have built a successful organisation and are now providing good quality, affordable accommodation for local people in housing need.

4.2 We have serious concerns regarding the housing needs of future generations. With them facing great difficulty in obtaining social housing, they will have little choice other than the increasingly unaffordable private sector or to move away from their families and friends. This is hardly a recipe for community cohesion, and will only succeed in creating a more fragmented society.

4.3 A one-bedroom flat in Islington would currently be valued in excess of £300,000 and whilst Right to Buy would give tenants a discount, the cost would still be well outside most tenants’ reach.

4.4 Some Unit Eleven members may be able to buy a property given a £103,900 discount in order to do so. Unit Eleven supports the idea that members who wish to buy should be able to benefit from a portable discount. However this only makes sense if our own properties are freed up for people in greater need, i.e. for better off tenants to be able to use the discount elsewhere.

5.0 Conclusion and Suggested amendments to the Bill

5.1 In conclusion, we categorically object to the imposition of means-testing and of the introduction of the Pay to Stay and Right to Buy legislation. As we believe this will create housing problems (especially in London), and will do little if anything in resolving our current housing crisis. And we therefore request that we should be exempted from the forthcoming legislation within the proposed Housing and Planning Bill and would suggest the following amendment.

"That the Right to Buy and Pay to Stay legislation does not apply to homes in the Co-operative Sector, including Co-operatives that manage Housing Association properties ".

December 2015

Prepared 14th December 2015