Family ties

According to historian Thomas Fuller ‘birth is the beginning of death’. For many of those working in the housing sector the birth of the Lib-Con coalition will bring those words to mind.

For more than a year now, the Conservatives have been dropping hints about which elements of Labour housing policy they would kill off, and in the past fortnight, their intentions have become very clear.

Next week housing minister Grant Shapps is expected to deliver the fatal blow to housing regulator the Tenant Services Authority. His words should also point the way to a marriage of convenience which will see the Tenant Services Authority’s governance and viability functions tied to the Homes and Communities Agency.

All this talk of births and marriages sounds almost exciting, but with it comes a round of death notices for some of the sector’s most high-profile schemes. The writing is now on the wall for the TSA, reforms to the private rented sector and housing market renewal pathfinders. So is the sector wringing its hands over its loss, or secretly breathing a sigh of relief?

Tenant Services Authority

The regulator’s demise had still to be confirmed when Inside Housing canvassed views on its importance. But everyone - apart from the ministers who are seeking to abolish the TSA - was unequivocal that scrapping it would risk damaging the sector.

The TSA had made some last-ditch attempts to persuade the Tories to provide it a stay of execution. Over the past five months it has announced two 10 per cent cuts to its budget.

This seems unlikely to deter Mr Shapps. The death of the TSA will not exactly be a surprise, but next week’s expected announcement by the housing minister will still generate plenty of shockwaves.

Last week, credit ratings agency Moody’s Investor Services warned that changes to the regulatory framework could have negative implications for housing associations’ credit ratings.

A spokesperson for the Council of Mortgage Lenders suggests that lenders could see the demise of the regulator as a sign that no one is watching over the sector. She adds: ‘Not having proper regulation in the sector would discourage lenders from possibly investing in this. Abolishing the TSA could damage the £60 billion of funds already invested.

‘With all the pressures on housing, with the pressures on first-time buyers and with all the issues with capital gains tax, it would be a step in the wrong direction. All the uncertainty does not help either.’

Private rented sector

It’s also back to square one for regulation in the private rented sector. In January 2008, Julie Rugg, senior research fellow in the centre for housing policy at the University of York, started a review into the sector. Her recommendations were picked up by the government, which proposed a national register of all landlords, regulation of letting and managing agents, and compulsory written tenancy agreements.

But last Thursday, Mr Shapps pushed aside two years of consultation into Ms Rugg’s recommendations, and said he would scrap plans for new regulations. He believes that the private rented sector is already subject to a perfectly adequate legal framework and that implementing Ms Rugg’s recommendations could introduce too much additional red tape to the sector.

He said: ‘With the vast majority of England’s 3 million private tenants happy with the service they receive, I am satisfied that the current system strikes the right balance between the rights and responsibilities of tenants and landlords.’

Instead, councils will be encouraged to use their existing powers to protect tenants from rogue landlords. Unsurprisingly, landlords are thrilled. ‘Handing this power over to councils is going to be challenging, but it isn’t insurmountable,’ says Vincenzo Rampulla, public affairs officer at the National Landlords’ Association. ‘They need to create a forward-facing service for landlords so it is not a chore to engage with the council.’

Ms Rugg isn’t convinced this will work. ‘One of the reasons we did the review was because the existing regulations did not seem to be working,’ she says, adding she is very disappointed that this decision takes the future of the private rented sector back to where it was three years ago.

Ms Rugg says that local authority environmental health departments lack the capacity to adequately address standards in their areas. And there is very little chance that councils will launch a big recruitment drive for these departments any time soon.

Kay Boycott, director of policy and campaigns at homelessness charity Shelter, says: ‘We are not convinced that in a time of economic instability [councils] will provide the protection private tenants urgently need.’

Pathfinders

Two announcements made in the past three weeks mean the leaders of England’s 10 housing market renewal pathfinders are starting to mourn the security of their multi-million pound programmes to revitalise rundown areas of the north and midlands.

Last Thursday, the government removed the ring fence from the housing market renewal capital grant. This was the second blow to the programme in a month, with a £50 million cut due from this year’s budget.

Ministers trumpeted the removal of the ring fence around the £236 million grant fund as an opportunity for councils to become more flexible over the way they make savings. But the loss of the ring fence also represents a loss of security of funding for the pathfinders. Councils need to make £1.66 billion of savings this year, and some of those savings can now come from housing market renewal funding.

A spokesperson for the Communities and Local Government department says: ‘Pathfinders will have ongoing commitments for building new homes, so it does give them more freedom but in practice it is going to be spent on the same things.’

Alistair Graham, director of the Oldham Rochdale HMR pathfinder, says he is less concerned about the decision to remove the ring fence than he is about the £50 million cut.

‘I think it is unlikely that the council would decide to spend the money elsewhere,’ he says. ‘But we are not very happy about the £50 million cut because it is going to cause us quite a lot of difficulty. We are part-way through the programme and it is making it difficult to manage the programme and keep to the commitments that we have made.’

Brendan Nevin, visiting professor at the University of Manchester, and one of the key figures behind the launch of the pathfinder programme in 2002, describes the cuts as a ‘business planning nightmare’ for pathfinders.

He is also concerned that the cuts have delivered a further wound to the housing market renewal mission: ‘This could damage relationships between government and communities for more than a decade. They will wonder how they can trust the government again when what has been promised has been taken away from them.’

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