Housing and Planning Bill

Written evidence submitted by Anthony Collins Solicitors LLP (HPB 17)

Housing and Planning Bill 2015-16

1. This Response is submitted on behalf of Anthony Collins Solicitors LLP. Anthony Collins Solicitors LLP is a specialist law firm based in Birmingham. With a heritage founded on the desire to help and support the communities in which we live, our ethical drive influences the way we work. Our lawyers are focused on serving business and private clients around six key sectors. One of those sectors is housing, where we contribute nationally to the regeneration of housing and creating successful neighbourhoods where people want to live.

Part 4 Chapter 1 - Implementing the right to buy on a voluntary basis

Funding of discounts offered to tenants

Section 56(2) Grants by Secretary of State/Section 57(1) Grants by Greater London Authority

2. It has been widely commentated that this section gives the Secretary/GLA wide discretion to vary the amount of grant below the compensation proposed by the NHF. We would like to see that this section is strengthened by including provisions along the lines of the "Net and Peak Debt" exception in the Right to Acquire (The Housing (Right to Acquire) Regulations 1997 No 619 ("Regulations") Part IV para 13) – i.e. a minimum amount of grant which would be whichever is the higher of the cost of developing the housing (i.e. land purchase and construction costs) or whatever was financially secured on the property (thereby giving comfort to lenders). It would also have the benefit of making clear how existing grants on properties would be dealt with.

3. The majority of housing associations are charities providing housing and associated facilities and amenities to charitable beneficiaries (people who are elderly, suffering long-term or chronic ill-health or a disability, or are in financially necessitous circumstances and thereby unable to house themselves on the open market). Pursuant to Charities legislation and regulation, charities cannot dispose of their assets at less than best value unless this furthers their charitable objects. A charitable housing association would be at risk of acting ultra vires and in breach of the law if it funded, out of its charitable assets, a discount granted to an applicant who is not a charitable beneficiary. Charitable housing associations must, therefore, have the ability to assess (by means testing, for applicants who are not elderly, in long-term or chromic ill health or disabled) an applicant’s charitable beneficiary status at the point of application. They need to have either the absolute right to reject an application from a non-charitable applicant (and to decline to subsidise or assist that applicant into home ownership in any other way that requires the charity to deploy funds or other resources in doing so) or to be reimbursed by the Government the full value of that discount, funding or resources expended, so they are not subsidising non-charitable activities out of charity assets and thereby breaching charity law and regulation.

4. So in summary we would ask for amendments to ensure: -

a. An absolute floor under the amount of grant along the lines of the net and peak debt exception in the Right to Acquire.

b. For charitable housing associations, either the right to exclude non-beneficiaries from the Home Ownership Criteria OR a 100% reimbursement (no conditions).

Additional Provision

Section 58 Monitoring

5. Given compliance with "the Home Ownership Criteria" means the practical implementation of the voluntary right to buy, we consider the legislation needs to go one stage further to: -

a. Include the statutory provisions on ASB [1] and demolition notices [2] can apply to a voluntary scheme.

b. Ensure such a scheme can easily work bearing in mind the properties will already be secured to lenders. Support by lenders may be difficult to obtain and housing associations cannot be put into a position where they are unable to comply with the Criteria due to the actions of third parties. We believe Paragraphs 22 and 23 of Part IV of the Regulations provide a framework that could be utilised to provide a floor on which to base a voluntary agreement (since those provisions include safeguards to lenders).

c. To ensure local authorities who have transferred their stock subject to a Right to Buy Risk Sharing Agreement / Disposals Claw Back Agreement cannot use that agreement, as a level to obtain further receipts as a consequence of a housing association implementing the Home Ownership Criteria.

6. To give effect to our suggestions an additional section would need to be inserted with wording along the lines of: -

58(7) [and if no 100% reimbursement for charitable housing associations] The Home Ownership Criteria will include the right for charitable landlords to exclude non-beneficiaries.

58(8) The Secretary of State may make regulations to apply the following to the Home Ownership Criteria: -

i. Paragraphs 22 and 23 (lenders consent) of Part IV of the Right to Acquire (The Housing (Right to Acquire) Regulations 1997 No 619

ii. Section 121A Housing Act 1985 (suspension of tenants’ rights under the Home Ownership Criteria due to ASB)

iii. Section 305 and Schedule 13 of the Housing and Regeneration Act 2008

iv. Ensure no local authority can demand a share of any receipt from the sale of any property

v. [and if no 100% reimbursement for charitable housing associations] Ensure that landlords may make such enquiries of statutory bodies as is necessary to ascertain whether or not a tenant applying for the right to buy under the Home Ownership Criteria is a charitable beneficiary

Part 4 Chapter 2 - Vacant high value local authority housing

Section 63 Housing to be taken into account

7. We are acting on the first transfer of housing stock under The Housing (Right To Transfer from A Local Authority Landlord) (England) Regulations 2013 ("Transfer Regulations").

8. Under section 63 a local authority may still be required to pay the levy in respect of high value vacant social housing even where such properties have been transferred outside of the local authority’s ownership.

9. Under the Transfer Regulations, a local authority may at any time request that the Secretary of State halts the transfer proposal if the transfer would have a significant detrimental effect on the local authority’s ability to deliver its housing services or regeneration within the local area. Local authorities may be able to argue this more effectively where there is a requirement to pay the HVVSH Levy in respect of transferred properties post-transfer, because the money to make such payments will need to be found from alternative sources (and the pool of properties which could be disposed of to raise funds would be reduced by transfer). Consequently we propose there is an exemption where the stock transfer is due to the exercise of tenants’ rights under the Transfer Regulations.

November 2015

[1] Section 121A Housing Act 1985

[2] Section 305 and Schedule 13 of the Housing and Regeneration Act 2008

Prepared 10th November 2015