All posts from: December 2011
The dust is settling on the government’s defeat over its plans for a bedroom tax for underoccupying social tenants.
The focus is now moving on to what the impact of the Lords amendment might be and what the government will seek to do next.
During the debate, welfare reform minister Lord David Freud said the proposal by Lord Richard Best to exempt households with a spare room from the tax would cost the government around £300 million in savings.
The eventual amendment passed watered down Lord Best’s amendment so that only those with a spare room who are not able to find ‘suitable alternative accommodation’ will be exempt.
This would, you imagine, substantially reduce the amount of savings lost. But the Department for Work and Pensions is still sticking to the ‘around £300 million’ claim.
This could mean one of two things.
1) The government is effectively admitting that there will be little or no alternative accommodation for tenants to move in to – in which case the claims of Baroness Patricia Hollis and others that tenants would be effectively punished for something that is not their fault carries weight.
2) The government is overstating the amount by which the amendment will cost the taxpayer. While not exactly an exaggeration to rank alongside the late Kim Jong-Il’s boast about his debut golf attempt (11 hole-in-ones, 38 under par), it nevertheless seems to be over-egging things somewhat.
The bottom line is that we will not know for sure the amount of savings to be lost as a result of Lord Best’s amendment until ‘suitable alternative accommodation’ is defined.
The debate over the bedroom tax is likely to increase over the next few months and it will be fascinating to whether the government will seek to overturn the amendment, and if so, whether it will compromise elsewhere to get the Lords on side.
Inside Housing today received a picture of Lord Richard Best surrounded by a pink heart with the words ‘Love You’ above it (see right).
The bizarre picture was Accent Housing Group’s touching way of saying thanks to Lord Best and his fellow peers for defeating the government on a crucial welfare reform bill vote this week.
Plans to restrict housing benefit for underoccupying social tenants were amended to exclude those with one spare room where no suitable alternative accommodation is available.
The moral and social case for watering down the tax, which would have unfairly cut the income of hundreds of thousands of vulnerable people has been well publicised.
But the impact on landlords should also not be underestimated.
The measure would have meant landlords having to dedicate more resources to monitoring which tenants are eligible for a spare room.
This means actively monitoring the age and gender of children, measuring rooms to see if an extra bed can be fit in and keeping tabs on whether family members have moved out or not. As Lord Best said on Wednesday it would be a bureaucratic nightmare and require ‘an army of snoopers’ to determine who has to pay the bedroom tax.
This extra administration and bureaucracy is the last thing landlords need when they are getting to grips with a new funding regime, new regulatory framework, planning changes and a turbulent and unpredictable economic climate.
The government will almost certainly seek to overturn Lord Best’s amendment when the bill returns to the Commons in the New Year. But the size of the government defeat - 68 votes - means there is leverage to persuade the coalition to look at other ways of reducing the impact on tenants and social landlords.
Measures to water down the bedroom tax are sorely needed and it is no wonder that, following Wednesday night’s drama, landlords are saying they love Lord Best.
Tenants must seize the opportunities presented by regulatory reform, says guest blogger Paul Eastwood
Having been chief executive of four housing associations, I have recently had the opportunity to wear another ‘hat’, working with tenants and Labour Party members in my own constituency and across the east of England. Common concerns are being expressed about the current housing crisis in a region where average house prices are now up to 15 times average earnings and where owner occupation is set to drop to 64 per cent by 2021.
My discussions have revealed a lack of preparedness of landlords for the new regulatory regime from next April, and the lack of awareness of tenants of their enhanced role in scrutiny and increased responsibility in driving up standards. The changes represent a huge opportunity for tenants, but also for the Labour Party to be actively working with tenants in every district to ensure that efficient and inclusive services are provided. The Labour Party developed from groups representing working people, and the challenge for the party now is to reconnect with its roots through the self regulatory system.
A local housing campaign that I have led in Hemel Hempstead, has raised awareness with tenants on current issues. Responses from tenants showed that 85 per cent were opposed to any move towards market rents, and 92 per cent were opposed to any dilution of existing terms of tenancy. This all highlighted that the government, as well as the local authority landlord, is out of step with tenants’ views. A benefit of the campaign has been an increase in new party members, all of which allows us to be doing more.
Speaking at Labour’s eastern regional conference in October, I recommended that the Homes and Communities Agency should be diverting subsidy to those landlords who are demonstrably making best use of their existing stock and investing in communities. There was wide support for this. Tenants should now be asking their landlords to produce an annual asset management report, setting out how they have made optimum use of their stock in the preceding year - through enabling new build, sales, demolitions, major works, etc. This could become a powerful centre piece of local scrutiny, and a key contribution to holding landlords to account.
In the 1980s Labour led on developing tenant involvement. A new opportunity now presents itself for tenants to scrutinise what they wish to scrutinise, and lead the way to better services. Tenants and the Labour Party, working together, should seize it.
Paul Eastwood is a freelance housing consultant and director of housing partner associates
The ambiguous status of housing associations and whether they should be classified as public or private bodies was in the spotlight again this week.
The government has directed the Tenant Services Authority to require landlords to ensure tenants can get involved in carrying out their own repairs.
While many landlords in the sector will no doubt support the principle of tenant cashback, there is anger that the government is using regulations, intended to ensure financial stability, governance and viability of landlords, to force them to implement the policy.
Similarly, the new TSA framework requires landlords to use the internet to set up mutual exchanges of tenancies.
The National Housing Federation believes this is a misuse of regulations, which should, they say, refrain from prescribing how landlords achieve outcomes.
Julian Ashby, deputy chair of the TSA and chair of the new Homes and Communities Agency regulation committee, has a very clear view that the regulator ‘should not run associations businesses for them’ and should merely ensure they are fulfilling their objectives while not getting into financial trouble.
Ultimately where you stand on this issue will largely depend on how you see housing associations.
They are private organisations, and, especially as they are expected to shoulder more risk, are to some extent justified in complaining about prescriptive directions from government.
On the other hand, associations’ income is largely based on taxpayer’s funds in the form of housing benefit and grant, and therefore they cannot grumble when government tries to prescribe what they should and should not do.