CWAG Newsletter – June 2024
General Election – What the Parties are offering on Housing?
The summaries below highlight the key policy areas and approaches as set out in the Party Election Manifestos:
Building New Homes
Labour
Plan to build 1.5 million new homes in England over the next parliament. Proposals include:
- Restoring mandatory housing targets and strengthening the presumption in favour of sustainable development.
- Prioritising a ‘brownfield first’ approach and a more strategic approach to the Green Belt which would allow the release of lower quality ‘grey belt’ land under certain conditions.
- Building a new generation of new towns.
- Introducing new mechanisms for cross boundary strategic planning that will require Combined and Mayoral Authorities to plan strategically for growth in their areas.
- Reform of compulsory purchase compensation rules to improve site assembly and address the inflated price premiums achieved by landowners on land should planning permission be granted.
- Supporting local authorities to fund additional planning officers, through increasing the rate of the stamp duty surcharge paid by non-UK residents.
Conservatives
Plan to build 1.6 million new homes in England over the next parliament. Proposals include:
- Abolishing legacy EU nutrient neutrality rules to unlock development of 100,000 new homes with existing planning permissions.
- Fast tracking the delivery of homes on brownfield land in urban areas and setting up locally led urban development corporations.
- Raising housing density levels in inner London (to levels comparable with other European cities).
- Supporting small and local builders by requiring councils to set aside land for them and lifting Section 106 burdens on smaller sites.
Liberal Democrats
Plan to increase building of new homes to 380,000 per year across the UK. Proposals include:
- Building 10 new garden cities
- Reforming the Land Compensation Act 1961 to allow councils to buy land for housing based on current use value rather than a hope value basis.
- Improving planning outcomes by properly funding local planning departments, by allowing local authorities to set their own fees.
- Expanding neighbourhood planning across England.
- Expanding rural housing provision by encouraging the use of rural exception sites.
- Trialling Community Land Auctions to help fund vital local services and ensure local communities receive a fair share of the benefits of new development in their area.
- Encouraging development of existing brownfield sites.
- Introducing ‘use-it-or-lose-it’ planning permissions.
- Investing in skills, training and modern methods of construction.
Social and Affordable Housing
Labour
The labour manifesto commits to delivering the biggest increase in social and affordable housebuilding in a generation. This will be achieved by:
- Strengthening planning obligations to ensure new developments provide more affordable homes.
- Prioritising the building of new social rented homes.
- Making changes to the Affordable Homes Programme to ensure that it delivers more homes from existing funding.
- Building capacity to enable councils and housing associations to make a greater contribution to affordable housing supply.
Conservatives
The Conservative manifesto makes only two references to social housing; to deliver on existing commitments to introduce ‘Local Connection’ and ‘UK Connection’ tests for social housing and to implement a ‘three strikes and you’re out’ expectation of social housing landlords in cases of anti-social behaviour.
There is also a commitment to boost the availability of affordable housing for local people in rural areas and renew the Affordable Homes Programme to deliver homes of all tenures, and focus on regenerating and improving housing estates.
Liberal Democrats
The Liberal Democrat manifesto includes a target to build 150,000 new social homes per year. Also included are measures to protect the rights of social renters and proactively enforce clear standards and strict time limits for repairs.
Right to Buy
Labour
With the aim of better protecting the existing social rented stock, Labour will review the increased right to buy discounts introduced in 2012 and increase protections on newly-built social housing.
Conservatives
Plan to maintain their existing approach by ensuring RTB discounts continue to rise with inflation. They will also fight any plan by local authorities to abolish the Right to Buy altogether.
Liberal Democrats
Would give local authorities (and National Park Authorities) the powers to end Right to Buy in their areas.
Energy Efficiency / Net Zero
Labour
Labour plan to invest an extra £6.6 billion over the next parliament in initiatives to upgrade energy efficiency and cut bills for families, doubling the existing planned government investment. The Warm Homes Plan will offer offer grants and low interest loans to support investment in insulation and other improvements such as solar panels, batteries and low carbon heating to cut bills.
Conservatives
The Conservatives plan to spend £6 billion on energy efficiency over the next three years to make around a million homes warmer. In addition, an energy efficiency voucher scheme, open to every household in England, will be available to support the installation of energy efficiency measures and solar panels, helping families lower their bills.
Liberal Democrats
Liberal Democrats are committed to making homes warmer and cheaper to heat with a ten-year emergency upgrade programme. Starting with free insulation and heat pumps for those on low incomes, and ensuring that all new homes are zero-carbon.
Private Rented Sector
Labour
Labour will immediately abolish Section 21 ‘no fault’ evictions, preventing private renters being exploited and discriminated against by empowering them to challenge unreasonable rent increases. In addition, Labour will take steps to raise standards in the PRS, including extending ‘Awaab’s Law’ and ensuring homes meet minimum energy efficiency standards by 2030.
Conservatives
Conservatives will pass a Renters Reform Bill, alongside delivering the court reforms necessary to fully abolish Section 21 and strengthen other grounds for landlords to evict private tenants guilty of anti-social behaviour.
Liberal Democrats
Liberal Democrats will deliver a fair deal for renters by immediately banning no-fault evictions, making three-year tenancies the default, and creating a national register of licensed landlords
Home Ownership Initiatives / First time buyers
Labour
Labour will introduce a permanent, comprehensive mortgage guarantee scheme, to support first-time buyers who struggle to save for a deposit, lowering mortgage costs. In addition, Labour proposes to work with local authorities to give first-time buyers the first chance to buy homes on new developments, preventing off plan sales to international investors.
Conservatives
The Conservatives would continue to offer a Mortgage Guarantee scheme and permanently increase the threshold at which first time buyers pay Stamp Duty to £425,000 ( from £300,000). In addition they plan to introduce a new Help to Buy scheme which would provide first-time buyers with an equity loan of up to 20% towards the cost of a new build home, enabling first-time buyers to get onto the housing ladder with a 5% deposit. The scheme will be part funded by contributions from house builders.
Liberal Democrats
Liberal democrats would help people who cannot afford a deposit to own their own homes by introducing a new Rent to Own model for social housing where rent payments give tenants an increasing stake in the property, owning it outright after 30 years.
Homelessness and Rough Sleeping
Labour
Labour is committed to developing a new cross-government strategy, working with Mayors and Councils across the country, to put Britain back on track to ending homelessness.
Conservatives
The Conservatives plan to continue with existing plans to end rough sleeping.
Liberal Democrats
The Liberal Democrat manifesto commits to ending rough sleeping within the next parliament by:
- Urgently publishing a cross-Whitehall plan to end all forms of homelessness.
- Exempting groups of homeless people, and those at risk of homelessness, from the Shared Accommodation Rate.
- Introducing a ‘somewhere safe to stay’ legal duty to ensure that everyone who is at risk of sleeping rough is provided with emergency accommodation and an assessment of their needs.
- Ensuring sufficient financial resources for local authorities to deliver the Homelessness Reduction Act and provide accommodation for survivors of domestic abuse.
Recent Publications
This month there are a number of new reports addressing issues highlighted as part of the General Election campaign:
Report by New Economics Foundation – Reforming Right to Buy – June 2024
This is another report looking to influence the debate around the future of the Right to Buy. It outlines a package of proposed reforms that would retain the RTB in a format that no longer exacerbates the current housing crisis.
The key to delivering meaningful change is to devolve decision making around the RTB to local authorities, enabling councillors, who understand local housing issues, to decide on how the policy should be offered in their area.
Each local authority would have powers:
- to suspend right to buy where it can be demonstrated that the policy is contributing to affordable housing shortages.
- to end right to buy in respect of newly built or acquired homes.
- to introduce measures to prevent homes sold under the right to buy from being let in the private rented sector.
- Reduce discounts and extend qualifying periods.
In addition, Treasury rules should be amended to allow councils greater flexibility and full access to receipts to better provide replacement stock.
Housing Subsidy’s long-term shift from supply to demand and what might be done about it – Prof Kenneth Gibb – UK Collaborative Centre for Housing Evidence – June 2024
This paper examines the long-term shift from supply side housing subsidies providing capital subsidies to build new homes to personal demand side personal housing subsidies to help people pay for housing. This shift has been in progress for the past 50 years resulting in the housing cost element of universal credit representing the largest government subsidy to housing (amounting to more than £31 billion in 2023/24 which equates to about one-tenth of the entire social security budget).
Whilst the paper makes the case for reversing the reliance on demand led subsidies, it sets out the immense difficulties involved in shifting back to capital funding in any material way. Change cannot be accomplished quickly and involves significant cost and funding challenges in advance of beneficial impacts coming into play. However, there is a clear case for rebalancing supply and demand subsidies as part of a consistent long-term policy for the housing system.
English Housing Supply Update Q1 2024 – Savills
This report highlights that planning consents for new housing have fallen below current completions for the first time since 2009 with poor outlook for new home delivery. 232,500 new homes were built in the twelve months to Q1 2024, but only c. 222,000 new homes are estimated to have gained full planning consent in that time.
As a result, completions are now likely to fall even further below housing need – Savills forecasts suggest that the number of new homes being built may be as low as 160,000 in 2024/25.
Diary Date – LGA Webinar – New Regulatory Regimes – Postponed
The LGA webinar bringing together the Housing Ombudsman and Regulator of Social Housing to discuss recent changes and new regulatory requirements has been postponed until after the General Election.
The new date is 25th July 2024 (10am – 11am) For further details see the LGA website
Diary Date – CWAG Annual General Meeting
This will be held on Thursday 19th September 2024 (between 10.00 and 12.00) via Teams.
Presentation Slides – CWAG Finance and Business Planning Workshop – June 2024 ( Cloned )
Workshop facilitated by Steve Partridge (Savills) covering
- Economic pressures undiminished for HRA sector
- Revising national projections
- Impact of rising capital pressures
- Revenue Repairs
- Reserves and savings
- Building safety
- Energy efficiency and net zero carbon
- Newbuild development – where are we?
- Other revenue pressures
- Future investment
CWAG Newsletter – May 2024
This Update includes the following
Progress of Renters Reform Bill
After almost a year, the Renters Reform Bill finally completed its passage through the House of Commons on 24th April 2024. Delays were due to concerns around the capacity of the Courts to process possession cases.
A significant number of amendments have been made including:
- Tenants will not be able to give notice that they wish to end a tenancy for at least 6 months after taking it on, rather than after two months as previously proposed.
- Abolition of section 21 “no fault” evictions will not take place until court reforms have been implemented (the Opposition continues to press for a clearer implementation date as the legislation currently leaves the timing a matter for Ministerial judgement).
- Provisions have been added to allow landlords to recover possession of properties let to full-time students at the end of the academic year to ensure these are available for reletting to students in the next academic year.
- The Minister also committed to undertake a review of local authority private rented sector licensing schemes with “the aim of reducing burdens on landlords”.
- The Government will review the implementation of the tenancy reforms within 18 months of measures being applied to existing tenancies.
The Bill has now moved to the House of Lords receiving it’s first and second reading in the on 1st May 2024 and 15th May 2024 respectively. Secretary of State, Michael Gove has stated the government’s intention to enact the legislation by the ‘summer’ with Implementation by the Autumn.
Consultation Outcome – Changes to RSH Fee Regime
The Regulator of Social Housing (RSH) has announced the outcome of its consultation on proposed changes to the charging regime for social landlords. The Decision Statement indicates that there was broad support for the new approach which will see fees paid by social landlords to cover the full cost of regulation in the sector.
For councils, this will mean a requirement to pay fees for the first time to cover the cost of the RSH’s more active regulation against the Consumer Standards, including the new the inspections regime. Councils owning over 1000 homes will be charged at a pro rata rate of £6.63 per property.
The new arrangements come into effect on 1 July 2024. Invoices will be sent out in June. For more details see the RSH Decision Statement
Recent Publications
Reforming the Right to Buy (The Housing Forum) – April 2024
Whilst ending the Right to Buy altogether would be the best way of safeguarding the social housing stock, this report recognises that all the main political parties currently want to retain the RTB in some form. This briefing paper sets out a series of recommendations to tackle the most problematic aspects of the current scheme including:
- Removing the RTB from Newbuild homes
- Using covenants to prevent the letting out of property, or alternatively requiring properties to be offered to the council to be let if not used for owner occupation.
- Allowing councils to receive the full value of RTB sales.
- Modernising exemption criteria e.g. to include larger homes and bungalows.
- Discounts should be reduced to no more than 20%.
The Finances and Sustainability of the Social Housing Sector (LUHC Committee) – Published 29th April 2024
This report from the Levelling Up Housing and Communities Select Committee highlights the severe financial pressures currently facing the social housing sector.
Current issues have arisen because of repeated government-imposed rent caps coinciding with unprecedented costs for decarbonisation, fire safety and the regeneration of older homes. Whilst overall the sector is deemed to be generally resilient, the impact on social housing newbuild has been stark as providers retrench and focus on their existing stock.
Given the chronic shortage of social housing the Committee recommends that the Government should set and publish a target for the number of social homes it intends to build each year, prioritising grant funding for social housing rather than the current focus on affordable rent and shared ownership. The Government is also urged to use the planning system to support social housing build schemes using land value capture as a tool to ensure land price does not inhibit development of new social homes. Other proposals include greater flexibility in the net additionality guidelines used by Homes England as these are a barrier to regeneration schemes in many areas. The Government is also urged to fund fire safety works in the social housing sector on the same basis at currently available to the private sector.
Rethinking Repairs and Maintenance : 12 Guiding Principles (Chartered Institute of Housing / National Housing Federation) – Published 9th May 2024
This report relates to one of the action plan recommendations in the 2023 CIH / NHF ‘Better Social Housing Review’, namely ‘Housing associations should partner with residents, contractors and frontline staff to develop and apply new standards defining what an excellent maintenance and repairs process looks like.’
This guidance identifies twelve guiding principles for how social landlords should work with residents to improve the repairs and maintenance services. The 12 principles are grouped into themes which are intended to be addressed consecutively, starting with culture and resident engagement, tackling discrimination, and involving frontline colleagues to understand and improve performance.
Future Meetings
CWAG Finance and Business Planning Meeting Thursday 6th June 2024 (10.00 – 13.00)
New Regulatory Regimes – LGA with the Housing Ombudsman and Regulator of Social Housing – Thursday 13th June 2024 (3 pm. – 4 pm)
The LGA is hosting a webinar that will bring together the Housing Ombudsman and Regulator of Social Housing to discuss the recent changes and new requirements impacting on councils.
A representative from the Housing Ombudsman will discuss the new Complaints Handling Code, including how local authorities should identify the member responsible under a council’s statutory duty. The Regulator of Social Housing will set out the powers available to them under the new regulatory regime, including inspections and grading of local authority housing services. There will be opportunities to raise issues and question both before and during the event.
For further details see the LGA website
CWAG Newsletter – April 2024
This Update includes the following
CWAG Organisational Update
Members will be aware that Southend City Council is planning to take on the Administrative Authority role on behalf of the group once all members have signed up to the Service Level Agreement. On transfer the policy officer post will transfer along with management of the group’s financial affairs.
In addition, the group has a new Chair. Geoff Beales from Colchester City Council has taken on the role on an interim basis as Anna Milner has stood aside from the position following the decision by South Tyneside to bring management back in house by 2nd October 2024. The post will be subject to an election at the Annual General Meeting in September. Anna will stay on as an Executive Member until the AGM.
Government confirms CPI + 1% rent settlement for 2025/26
The Government has confirmed that the existing social housing rent settlement will be rolled over by a further year until April 2026. This means annual rent increases will continue to be capped at Consumer Price Index (CPI) plus one percentage point for 2025-26. This early announcement provides greater short-term certainty effectively deferring negotiations around the longer-term rental settlement for the next government.
Consultation Response – Competence and Conduct Standard
The Competence and Conduct Standard Consultation sets out the implementation arrangements for the new regulatory standard requiring senior housing managers and executives within social housing to either have or be working towards a relevant professional qualification.
The CWAG response recognises the value of relevant professional qualifications in improving performance and driving up standards in the social rented sector. However, alongside this there are concerns around the tight implementation timescales and the potential for these to negatively impact staff recruitment and retention in the short-term. The proposed timescales do not offer sufficient time to implement the necessary organisational and training challenges alongside succession planning.
In addition, the costs associated with introducing these measures are likely to be significantly higher than estimated in the impact assessment. No additional resources have been identified to cover implementation and associated costs which will need to be funded from already stretched Housing Revenue Accounts.
Other issues highlighted include role descriptions that are a poor fit with ALMO clienting arrangements and potential problems for organisations using external contractors where roles are deemed in scope of the new regulations.
Good Practice Consultation – Housing Ombudsman
The Housing Ombudsman has launched a consultation for social housing landlords on a proposed new approach for issuing Good Practice. The proposals relate to new powers conferred on the Housing Ombudsman in the Social Housing (Regulation) Act 2023 to issue guidance on good practice in carrying out housing activities covered by the Ombudsman Scheme.
The consultation is about providing access to ‘good practice’ as opposed to ‘best practice’. As such, the proposed approach will encourage landlords to self-assess against a good practice template at the point an issue arises rather than wait for a complaint about the topic. In practice, there may be entirely justifiable reasons for the landlord’s response to differ from suggested good practice, however undertaking the self-assessment allows for the decision to be documented and scrutinised.
The consultation seeks feedback on the Ombudsman’s principles of good practice and proposed approach as well as suggestions for potential topics. The intention is to issue ‘good practice guidance on two topics per year. Initial suggested topics include:
- making an effective apology
- deciding on appropriate levels of compensation
- effective complaint handling during merger or stock transfer
- effective root cause analysis of complaints
- knowledge and information management
The consultation closes on 21st May 2024
Good-Practice-consultation-26-March-2024.pdf (housing-ombudsman.org.uk)
Recent Publications
Housing Outlook Report Q1 2024 Resolution Foundation (March 2024)
This review sets the UK housing market within the context of similar advance economies and examines whether the housing crisis in the UK, particularly affordability pressures and quality issues are specific to the UK. Homes in the UK are more cramped, poorer quality and more expensive relative to general price levels than in other OECD countries. The housing stock is also the oldest in Europe (4 in 10 homes were built before 1946) with consequent issues around damp and poor insulation. The report highlights why housing is likely to feature prominently in this year’s General Election.
Follow-up report: Spotlight on Noise complaints – Time to be Heard – Housing Ombudsman (April 2024)
The Housing Ombudsman has published its evaluation into its Spotlight report on noise complaints. The report highlights several positive developments in this area including the following:
- Landlords responding more sensitively and being more open to potential contributing factors underlying noise complaints.
- Introducing timescales for responding to noise complaints.
- Triaging noise complaints to ascertain whether they fall under household noise or ASB..
- Focusing on preventative actions, such as using void improvements to help reduce noise concerns for incoming residents.
- Developing a less confrontational approach including changes to the language used e.g. no longer using terms such as ‘perpetrator’ and ‘incidents’.
Learning from Severe Maladministration – Housing Ombudsman (April 2024)
This new Housing Ombudsman report is intended to be first of a new series of reports looking in more detail at the learning from recent casework where there has been a finding of severe maladministration. This report highlights cases involving 8 landlords.
Learning from Severe Maladministration (housing-ombudsman.org.uk)
Shared Ownership Report – House of Commons Levelling Up, Housing and Communities Committee (March 2024)
This report looks in detail at the current problems with shared ownership including rapidly rising rents, uncapped service charges, liability for repairs and maintenance costs and complex leases which combined mean shared ownership has become an unbearable reality for many people seeking to become homeowners. The report makes a number of recommendations that are urgently required to improve shared ownership to address current weaknesses undermining this ownership vehicle.
Finance and Business Planning Meeting – Diary Date
Professionalism Consultation Response
The Competence and Conduct Standard Consultation sets out the implementation arrangements for the new regulatory standard requiring senior housing managers and executives within social housing to either have, or be working towards, a relevant professional qualification.
Whilst recognising the value relevant professional qualifications in driving up standards in the social rented sector, the CWAG consultation response highlighted concerns around the tight implementation timescales and the potential for these to negatively impact staff recruitment and retention in the short-term. The proposed timescales do not offer sufficient time to implement the necessary organisational and training challenges alongside succession planning.
In addition, the costs associated with introducing these measures are likely to be significantly higher than estimated in the impact assessment. No additional resources have been identified to cover implementation and associated costs which will need to be funded from already stretched Housing Revenue Accounts.
Other issues highlighted include that role descriptions are a poor fit with ALMO clienting arrangements. In addition, organisations using external contractors may face difficult challenges if these roles are deemed in scope of the new regulations.