Welfare and Work Bill Committee

Written evidence submitted by TPAS (WRW 25)

About TPAS

TPAS is the leading national tenant involvement organisation in England. We believe in housing practitioners and tenants working in partnership to improve their homes and their communities. Our membership is made up of local tenants and landlord organisations, and covers over 2.2 million homes. We have been representing our members across England since 1988.

Summary

This submission reflects the opinions of involved tenants, whose voices have been little heard in discussions about the proposed reforms to social housing rents. It gives their perspectives on the likely effects of the Bill as currently presented, and what would be most and least desirable outcomes.

The key points of our submission to the Committee are:

· We have heard ministers, MPs, and pressure groups say that social tenants will welcome the rent reductions. This is an inaccurate claim. Tenants’ actual priorities should be heard, understood and considered during the passage of this Bill.

· Tenants’ concerns about the negative impact of rent reductions on the services they receive far outweigh happiness about any personal financial gain.

· Many tenants believe that the rent reductions will undermine social housing provision in terms of its quality, quantity, and contribution to tenants’ lives.

· Concerns focus on two inter-related issues. Firstly what social landlords will inevitably have to do in response to the rent reductions. Secondly how social landlords will choose to respond, and how far their decisions will align with tenants’ priorities.

· As this Bill is considered and refined, we would like to see:

o A clear statement from government and social landlords on what accommodation options will be available to people affected by the benefit cap and reduced tax credits and by the anticipated resultant changes in letting practice

o Consideration of whether social landlords could or should be given flexibilities to subsidise the rents of households whose incomes are inadequate to cover even a social rent, in order that every household in the country has at least one viable type of housing provision open to them

o Scrutiny of likely impacts on maintenance standards, tenant involvement and development of new sub-market rented homes

o Restatements of landlords’ commitments to, and the regulator’s requirements for, maintenance of the Decent Homes standard, good quality property maintenance, and tenant involvement

o A requirement for tenants to be consulted and engaged with before revisions to landlords spending plans or business structures resulting from this Bill are finalised.

Introduction

1.1 TPAS is pleased to share evidence to inform the Public Bill Committee’s consideration of the Welfare and Work Bill. Discussions about government policy for social housing have become increasingly focused on the impact on providers of social housing. Whilst TPAS does also speak about the experiences of organisations that emphasise engagement with tenants, the purpose of this submission is to make sure that tenant voices are heard and reflected in consideration of the Bill.

1.2 Our evidence is based on comments made to us by the large body of tenants who are voluntarily involved with their social landlord. As well as paying rent in return for housing services, these people help to scrutinise service delivery, agree and monitor maintenance contracts, prioritise and address neighbourhood issues, inform business priorities, and so on. We refer to them as ‘involved tenants’ – because they engage with their landlords and understand how housing providers operate.

1.3 This submission focuses on likely effects of the Bill on landlords’ behaviours and priorities rather than on their finances, because the information to shape it comes primarily from people who receive services. Our submission is based on comments and opinions gathered from several hundred social tenants since the July budget.

1.4 It is important to remember that, alongside rent cuts, the full package of policies for social housing currently includes mandatory sales of council accommodation, loss of stock through the expanded Right to Buy, higher rents for households where individuals earn only moderate incomes, possible loss of security of tenure, and the likelihood of some tenants facing increasing difficulties accessing and sustaining any sort of housing because of the welfare reforms. Taken together, these give involved tenants strong cause for concern about the future of social housing.

1.5 Tenants are worried about how the Bill will affect landlords’ future ability to deliver valued services to the same client groups that receive them today. They worry about whether social landlords can afford to do this, and also whether they will choose to. They fear that social landlords will stop letting to some types of household, stop funding tenant engagement with staff and decision making, reduce levels of provision of core services, and pull away from delivering new homes and offering a local presence.

Welfare reforms

2.1 Social landlords have already had to deal with the impacts of welfare reforms, and in the most part they have tried to support tenants whilst doing this. However some have changed who they let homes to, and involved tenants expect more landlords to do this in future because of the reforms in this Bill. There is great concern about this. Some people will be unable to get social housing because they cannot pay for it – but what is to become of them when even the cheapest housing is out of their reach? We would like government and landlords to understand and comment on what accommodation options will be available to people affected by altered letting practices, and by the benefit cap and reduced tax credits.

2.2 Perhaps landlords could find a way to ‘subsidise’ people whose benefits no longer cover the rent, in order that they can still live in a social home. During consideration of this Bill we would like politicians and landlords to explore if this is possible (perhaps through variable rents), as it seems an increasing number of households will have no viable housing options in future -a highly undesirable outcome.

Rent reductions

3.1 As social landlords lose money from rent reductions, some tenants stand to gain. It may be useful for the Committee to understand tenants’ responses to this position.

3.2 Not all tenants will see a direct impact on their personal finances as a result of the rent reductions because many receive some Housing Benefit (or Universal Credit) to help them pay the rent. Some will benefit though. Of the tenants responding to our recent survey who will see a financial benefit from the rent reduction, the vast majority would use the money for day to day living costs, with around 20% hoping to save it for future use.

3.3 When the rent reductions were announced, there was an expectation that they would be welcomed by tenants. On the face of it this is a reasonable assumption: we know that many tenants’ incomes are under significant pressure, and the stated intention to use the savings for living costs confirms this. However, the first response of involved tenants was concern about potential negative effects on the landlord services they value rather than joy about positive impacts on personal finances. Tenants are also well aware that benefit reductions and Pay to Stay (especially for working households) will amplify pressure on ability to meet living costs by more than the amounts saved through the rent cuts.

4.1 Involved tenants understand that landlords will need to need to make cuts to their expenditure because of reduced incomes resulting from rent reductions and from other policies that sit outside of this Bill. They do not expect that efficiencies (in the sense of doing the same things at a lower cost) will cover the losses. Consequently they have clear views about areas that should be protected from cuts, and about the need to involve tenants in decisions about revisions to landlords’ spending plans.

4.2 Day to day maintenance of properties is the area that involved tenants would most like to see protected from spending cuts. Maintenance is important for quality of life, and current standards are hard won e.g. by tenants campaigning for the Decent Homes programme and being involved in setting and monitoring standards/contracts. Investment in building new homes is valued because it means that future tenants can benefit from security and affordability too. Tenant involvement is also considered high priority for protection, because of the benefits it brings both to landlords and to involved tenants. The recent report, An Investment Not A Cost [1] , shows that there is a business case for landlords to support tenant involvement. It delivers cost savings as well as service improvement and social dividends, and moving away from it now would undermine years of effort invested in developing relationships and working practices.

4.3 The possible impacts of the rent cuts on these areas should be scrutinised and understood as this Bill is considered, and a statement from government and/or landlords that maintenance and involvement will be protected would be welcome.

4.4 There is a strong desire for all tenants to be consulted before revisions to landlords spending plans are finalised. Equally strong is the desire for discussion with, or inquiry by, tenant-led scrutiny groups and residents’ associations. Use of up to date information held about tenants and their opinions would also help to bring tenants’ priorities into landlords’ decisions.

4.5 Timescales for remodelling financial plans, and for reporting these to the regulator, are tight but involvement of tenants should not be pushed aside in haste to meet deadlines. If this happens the decisions made will not be the best ones – local knowledge and insight into services will be bypassed – and historic partnership working will be quickly undermined. We would like to see a requirement for tenants to be consulted and involved before revisions to landlords’ spending plans or business structures resulting from this Bill are finalised.

Conclusions

5.1 Involved tenants are worried about the implications of the provisions in this Bill. They are concerned for potential future tenants as well as for themselves. We would like their actual responses to proposed rent cuts to be better reflected in debate, and we would like to see protection for their priorities strengthened as this Bill passes through Parliament.

September 2015


[1] https://nationaltenants.files.wordpress.com/2015/03/tlc-an-investment-not-a-cost.pdf

Prepared 16th September 2015