Sunday, 26 March 2017

Prize fight

Council tenants fighting uncooperative local authorities for the ownership of their homes struck an early blow with the introduction of new rules. Carl Brown investigates.

‘It’s fair to say we haven’t co-operated with that faction of tenants,’ admits Stephen Greenhalgh, the Conservative leader of Hammersmith & Fulham Council.

The ‘faction’ to which Mr Greenhalgh refers is made up of the West Kensington and Gibbs Green estates tenants’ and residents’ associations, which have repeatedly asked the west London authority to help them take over the ownership and management of 750 homes.

Hammersmith & Fulham is considering redeveloping the estates as part of plans to regenerate the nearby Earls Court exhibition site - proposals seemingly incompatible with the residents’ ambitions to set up and run their own housing management organisation.

In the world of prime minister David Cameron’s big society, where councils are encouraged to beef up residents’ powers, one might expect an attitude of co-operation - especially from a Tory authority. But as Mr Greenhalgh’s admission indicates, his council has opted instead to pull on the boxing gloves.

So which of the organisations stands the best chance of winning this fight?

Power shift
The residents’ associations could soon claim the first round, thanks to new regulations which will see the balance of power shift firmly in their favour.

In 2009 they became the first tenants’ group to serve ministers with a notice under section 34a of the Housing Act 1985, which asks them to force councils to co-operate with stock transfer requests. This was inserted into the 1985 act by the Housing and Regeneration Act 2008. The draft regulations necessary for its implementation will finally be put out to consultation next month (Inside Housing, 7 January).

Jonathan Rosenberg, a housing campaigner who is helping the West Kensington and Gibbs Green tenants’ and residents’ associations, said the regulations should make life more difficult for uncooperative councils like Hammersmith & Fulham.

‘This is why section 34a was introduced, it was designed and will be implemented to stop councils blocking transfers,’ he adds. ‘Will Mr Greenhalgh co-operate with the government and obey the law?’

Whether Mr Greenhalgh will co-operate remains to be seen, he certainly refuses to say he will when questioned by Inside Housing. He does not believe, however, that the residents’ associations are representative of the majority of residents’ views.

Mr Greenhalgh is not the only council leader to have traded blows with residents who have their hearts set on owning and managing their homes. Papers released to Inside Housing under the Freedom of Information Act show that nine tenant organisations have experienced varying levels of co-operation from their local authorities (see www.insidehousing.co.uk for a full list).

History repeated
Once the policy comes into force, stock owning local authorities might well expect a wave of tenant-led stock transfers. But are they right to?

The new regulations would effectively reinstate the short-lived tenants’ choice policy, introduced in the Housing Act 1988 and scrapped in 1996, which gave tenants the right to transfer their homes to another landlord.

Keith Jenkins, a partner at law firm Winckworth Sherwood, says there were only around six successful tenants’ choice transfers. The policy was mainly used as a threat to local authorities which resisted tenants’ ambitions to manage their homes, he adds.

Mr Jenkins believes the number of transfers under the new regulations will also be relatively small. ‘Between five and 20 early on,’ he says.

In an impact assessment carried out in 2008 the Communities and Local Government department estimated the policy could lead to 2,200 homes being transferred each year.

The CLG drew up draft regulations in 2008, shortly before the process was put on hold when the way council housing was financed came under review. If adopted as originally intended, the new regulations will differ from tenants’ choice in two ways.

Tenants’ choice required organisations to be registered as an ‘approved landlord’ with the then social housing regulator the Housing Corporation at the start of a tenant-led stock transfer process. By contrast, the section 34a regulations would only require a group to have a properly agreed constitution; an open membership policy and at least a fifth of the tenants occupying the homes to be transferred. This suggests the new policy could be less onerous than tenants’ choice.

On the other hand, the new regulations would give councils the right to appeal to the secretary of state if there are clear financial reasons why the transfer should not go ahead.

Financial obstacles
Major reform to the council housing finance regime could therefore create the biggest obstacle to the acceleration of a tenant-led stock transfer programme.

Previously, when council homes were sold to a housing association, the Treasury would collect any profit or write off any debt when the sale price exceeded the total value. Under the new finance regime, authorities will be able to keep tenants’ rent rather than returning it to Whitehall for redistribution to their counterparts according to a complex Treasury formula, as is currently the case.

The revised arrangement, due to be introduced in April 2012, gives councils greater control and responsibility for their finances and one housing lawyer speculates this will make councils reluctant to sell off high-earning estates.

This could be bad news for residents seeking ownership of their homes and, ultimately, freedom from town hall control.

Trevor Bell, co-ordinator at the National Federation of Tenant Management Organisations, says tenant-led stock transfer is about residents having control over their own destiny. ‘It’s about being able to take decisions which are not subject to a council or arm’s-length management organisation’s policy,’ he adds.

With both sides limbering up for a fight it seems Mr Greenhalgh and other local authorities should beware: the big society might just be beginning to flex its muscles.

Timeline

December 2008
Developer Capital & Counties tells Hammersmith & Fulham Council it wants to redevelop Earls Court exhibition centre. The authority launches a consultation on the redevelopment of nearby West Kensington and Gibbs Green estates

June 2009
Hammersmith & Fulham insists no firm plans for the estates are in place, but pledges to re-home any residents affected by the plans

June 2009
Gibbs Green tenants’ and residents’ association formed

July 2009
West Kensington tenants’ and residents’ association formed

December 2009
The residents’ associations ask ministers to force Hammersmith & Fulham to co-operate

October 2010
The council launches a consultation on the joint planning framework for the development

January 2011
Inside Housing reveals the department will consult on making new regulations under section 34a of the Housing Act

February 2011
Draft planning framework due to be published

List of nine tenants’ organisations which wrote to the CLG about transferring their estates:

Friday Hill Tenant Management Organisation

Bushbury Hill Tenant Management Organisation

Stockwell Park Tenant Management Organisation

Lambeth Alliance of Tenant Management Organisations (Latmos)

Bloomsbury Tenant Management Organisation

Havelock Independent Residents’ Organisation

South Acton Residents’ Action Group

Springs Co-operative

United Residents of Bransholme North

 

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