Written evidence submitted by BCP Council [EXA 019]
Housing associations, charities, or community interest companies are mostly exempt from licensing under the Housing Act 2004. This does (in our experience) mean that the standard of living is somewhat lower. Having exempt accommodation within the scope of licensing would most certainly increase the standard of living. We would suggest that Registered Social Landlords could still be exempt as they have their own regulators, but charities and CIC’s should come into scope
If HMO Licensing was not an option then a set standard of conditions for exempt accommodation would be appropriate to ensure that a minimum standard of living is maintained. The conditions would be set by the Local Housing Authority but driven by current government guidance.
Should either of the above not be appropriate then the final option would that where exempt accommodation exists is for the Local Housing Authority to carry out a Housing Health and Safety Rating System assessment to ensure that no Category 1 Hazards exist. This however could be time consuming for officers and would unnecessarily detract from the current priorities including HMO Licensing, tackling rouge landlords, and dealing with disrepair complaints.
In terms of the quality of support provided to residents in exempt accommodation, our experience has generally been that this is of poor quality, with communications with providers intermittent. Residents have been attracted to the accommodation by unofficial style adverts on Gumtree for example, citing no rent in advance / deposit fees up front with unmet promises around support. Little consideration being given to the mix of client needs within the property. Residents are often unable to consider working or aspiring to move into work because of the higher rents.
No, the cost of exempt accommodation to the local authority is increasing year on year as more non-commissioned exempt providers enter the market. Costs to the council have increased year on year, putting increase pressure on services whose purpose and objective is to help the same groups exempt accommodation is claiming to assist.
The cost to residents appears disproportionately high to the offer of accommodation & support received. See additional comments below.
Providers of non-commission exempt accommodation are typically based a large distance from the buildings themselves (other regions of the country). Our experience is that there is consequently poor oversight of building management and support.
Around 50%. The balance is poor as there is very limited oversight and local partnership understanding of provision and specific arrangements.
No specific data available, however there is likely to be more non-commissioned exempt than commissioned.
There is a lot of evidence that non-commissioned providers are generating poor housing outcomes for people, encouraging people not local to the area to access accommodation, contributing to local homelessness and rough sleeping demands due to the unregulated management & support practices. Our experience is that Non-commissioned exempt providers do not agree to local partnership arrangements around homelessness prevention and housing pathway planning, generating significant local system issues in the effective provision of housing and recovery planning.
We have in the past seen cases where non-commissioned exempt landlords are unable or unwilling to tackle anti-social behaviour emanating from their premises, and on at least one occasion have had to use ASB legislation to issue a closure order for a premise. This is not something we would expect to have to do with a responsible landlord, who put the needs of their tenants first.
Existing local governance arrangements might work, such as local Homelessness Reduction Boards / Partnerships, where they exist.
It should be the Local Authority that maintains control of regulatory powers in respect of exempt accommodation but is governed by the National Government. An example of this happening at present will be the Building Safety Bill. The government will give powers to the regulator (in this case the H&SE) whom then delegate powers (or can) to the Local Authority.
Quality of provision in terms of management and support should be overseen in the same way as ‘commissioned’ local authority arrangements with Housing Support Providers. The local authority should not bear the cost of this function based upon legacy Providers investing in local markets without strategic planning or dialogue around local specialist housing needs. Resources to administer any regulations could come from Providers through registration for example.
Providers know how to access information and private consultants often are employed to advise them how to maximise HB but unlikely that the general public or tenants know much about it. Our local homelessness stakeholder forum would have limited knowledge or understanding of operations.
Additional Comments
Housing Benefit Subsidy for Supported Accommodation
Bournemouth, Christchurch, and Poole have significant numbers of supported accommodation units in the conurbation and this number is growing year on year. The growth is being seen where existing providers in the area expand their current portfolio or where providers new to BCP come into the area and purchase or lease property.
Historically most of the providers in the BCP area were registered providers, but the new providers are now increasingly registered charities, community interest companies or not for profit organisations. For example, in the Bournemouth conurbation we have 36 providers of which just under half are registered charities and community interest companies and we are currently aware of another 3 providers in this category wanting to move into the area to set up projects.
As you are aware supported accommodation claimants, if they meet certain criteria, remain entitled to Housing Benefit (HB) rather than claiming housing costs through Universal Credit and we reclaim this through Housing Benefit Subsidy.
To the providers and tenants, the Housing Benefit claiming, and assessment processes do not differ whether they are a registered provider, or a registered charity and the levels of rent charged are very similar. Due to the client groups these rents are considerably higher than general needs social housing or private rented sector charges.
Each case is diligently checked to make sure that they are, firstly, still eligible for HB and then that the charge is considered, evidence collected, and levels challenged where they are considered unreasonable, and compared to suitable alternative accommodation as required by the HB regulations, guidance and caselaw. This has always been complicated and time consuming but has become more difficult as providers use consultants to help set rents, so they are becoming “industry standard” amounts which makes the challenges harder and finding cheaper suitable accommodation almost impossible.
However, within the subsidy claim the providers are treated differently and the amount that can be claimed by the council in subsidy differs considerably. Registered providers usually attract 100% subsidy and HB subsidy is claimed in cells 102. Registered charities, community interest companies and not for profit organisations require the council to obtain a Rent Officer decision. This decision will inevitably be considerably lower than the rent and in most cases the HB will exceed the RO decision by some way. Where the HB is higher than the RO decision the council is unable to claim full subsidy as these cases appear in cells 96 and 97 and the shortfall must be met by the local council taxpayers.
We have also seen a rise in the number of providers leasing properties from investment companies who charge the provider high rental costs and make them liable for repairs and adaptations making the core rents high before any services or housing management charges are added. As rents increase, new providers come into the area, previous non-exempt providers become registered charities or ownership/properties change hands from registered providers to registered charities we have seen the subsidy loss in cells 96 and 97 increase, and we believe this trend will continue which places an unfair burden on the council and ultimately council taxpayers who have no control over the number or type of providers in our area.
We would ask the Department to consider the disparity between the different subsidy levels and bring the registered charities and other provider types in line with registered providers and allow 100% subsidy to be claimed where appropriate. The providers all offer similar services to meet the needs of the tenants and charge similar rents, so it is difficult to see why the Department continues to treat them differently. It is very difficult to explain the rationale of the funding to council taxpayers of BCP as to why the Department fully funds Housing Benefit for some supported accommodation but not for others receiving the same type of support and accommodation.
We are aware of the various reviews, pilots and consultations that are happening, and that supported accommodation is a very complex issue but would ask that you consider the funding issues for councils in this growing sector.
January 2022