Housing and Planning Bill

Written evidence submitted by Coin Street Secondary Housing Co-operative and Coin Street Community Builders (HPB 93)


Coin Street Community

1. Coin Street Secondary Housing Co-operative and Coin Street Community Builders have together built 220 affordable homes as part of a wider mixed use development on London’s South Bank.

2. These homes range from one bedroom flats to 5 bedroom houses and are owned and managed by four fully-mutual housing co-operatives. Coin Street is proud of these stable communities and the contribution they make to the Waterloo community and the London economy.

3. There are nine fully-mutual housing co-operatives in the immediate vicinity of Waterloo Station and many others nearby – some 25 in the constituency of Vauxhall alone. It is therefore a significant form of tenure in this part of London and has benefitted for many years from support by all major political parties.

4. These fully-mutual housing co-operatives rely substantially on volunteer effort. They are small businesses and – in this area at least – they are settled communities where all families in the co-operative know all the other families. They house many staff essential to the functioning of central London businesses, its health and transport services, its schools, and its emergency services.

5. The tenant-members of each co-operative are responsible collectively for setting their rents, collecting these rents, maintaining the co-operative’s properties, and allocating (occasional) vacancies to households in need in accordance with their nomination agreements. Fully mutual housing co-operative members have for years dedicated their volunteer time to keeping rents down and ensuring that their properties are well managed and maintained.

6. In September we wrote to the Secretary of State for Communities and Local Government about the impact on fully-mutual housing co-operatives of Right to Buy, Pay to Stay, and 1% per annum reductions in rent over four years. We attach a copy of our letter [1] for your reference together with the response received from the Minister of State for Housing and Planning [2] .

7. In November we responded to the department’s consultation on Pay to Stay. That letter is also attached [3] .

Right to Buy

8. Schedule 5 of the 1985 Housing Act lists exceptions to the Right to Buy and provides at (2) that "the right to buy does not arise if the landlord is a co-operative housing association". Schedule 1 of the 1988 Housing Act lists tenancies that cannot be assured tenancies and includes at Part 1 12 (1) "A tenancy under which the interest of the landlord belongs to...(h) a fully mutual housing association".

9. To date it has been accepted that tenants of fully-mutual housing co-operatives need to be treated differently in law. The 1985 Act sets out that "fully mutual", in relation to a housing association, applies when the rules of the association (a) restrict membership to persons who are tenants or prospective tenants of the association, and (b) preclude the granting or assignment of tenancies to persons other than members.

10. It is fundamental to the effective operation of our fully mutual co-operatives that every tenant has a shared interest in the financial health of the co-operative and in the effective management and maintenance of its properties (including communal gardens, meeting rooms, launderettes and other spaces). It is also fundamental that every tenant has an equal say in the policies and governance of the co-operative.

11. In our letter to the Secretary of State we referred to anxiety amongst co-operative tenants and sought confirmation that fully-mutual co-operatives would continue to be excepted from Right to Buy. The response from the Minister stated that the Government was conscious of specific issues that Right to Buy might cause particular organisations but did not give the requested confirmation. Although we have heard no argument in support of removing the exemption, we are concerned at the wide powers given to the Secretary of State under Part 4 chapter 1 paragraph 58 in respect of compliance with "the home ownership criteria". We seek clarity that fully-mutual associations will remain under statute excepted from Right to Buy.

Pay to Stay

12. The Minister encouraged us to contribute to the Pay to Stay consultation and we have done so. We believe that Pay to Stay, in the context of fully-mutual housing co-operatives, would be divisive and contrary to the underlying philosophy of mutuality and shared rights and responsibilities. It would erode the stability and range of skills that underpin the effective functioning of co-operatives. It would be administratively problematic: both burdensome and inappropriate where rents are set and collected by volunteers who are also your neighbours.

13. In the context of central London and the huge gap between co-operative and market rents – one that is increasing even without the requirement that associations should reduce rents – the options for households with combined incomes below £65,000p.a.(particularly larger families) are limited. Pay to Stay could easily become a disincentive to work.

14. We request that the Housing and Planning Act excepts fully-mutual housing co-operatives from the requirement to apply Pay to Stay.

November 2015

[1] Not published.

[2] Not published.

[3] Not published.

Prepared 26th November 2015