A review of the rent setting policy for Wales

Members may recall that the Deputy Minister for Housing asked for a review of the rent setting policy for Wales be undertaken. The Essex Implementation Programme Board and its Strategic Board recommended that independent reviews of both the Housing Revenue Account regime (HRA) and the Social Sector Rent Policies should be undertaken. This work is now almost complete. Whilst there are two reviews they are closely linked. The Housing Directorate is responsible for setting Guideline rents for HRA Subsidy purposes for Local Authorities and Benchmark rents for the Registered Social Landlord (RSL) Sector.

About the HRA and HRA subsidy System - A Local Authority Housing Revenue Account (HRA) is essentially a ring-fenced income and expenditure account of transactions relating to Council Housing Stock. The elements making up the HRA are contained in the Local Government and Housing Act 1989 and the Housing Act 1985 while further guidance is contained in Welsh Office circular 33/95. LA actual rents support the HRA and provide funding for maintaining Council stock and meeting WHQS. The Housing Revenue Account Subsidy System (HRASS) forms a part of the Housing Revenue Account, it attempts, through notional calculations, to provide an estimate of the level of subsidy required by LAs to maintain their Council House stock. Currently the subsidy for all LAs in Wales is negative and is consequently repaid to HM Treasury under the Devolved Administration Funding policy. The main elements considered in the calculation of the subsidy are income from Rents, Management and Maintenance allowances and Capital Finance charges (borrowing costs). Levels of Rents and Management and Maintenance allowances are set annually by the Welsh Assembly Government with the aim to achieve financial neutrality of the level of negative subsidy. Consideration is also given to LAs 30-year stock retention business plans when the annual levels are determined. It is anticipated that the HRASS will end thus no longer requiring us to participate in the redistribution of positive or negative balances across all LAs in England and Wales.

Rents for RSLs are the main source of income for housing associations and provides funding for private sector borrowing and is fundamental to the sustainability of business plans and meeting Welsh Housing Quality Standards(WHQS). The consultation document will propose a new national policy for the setting of rents by Registered Social Landlords and Local Authorities that own housing stock. The aim is to provide a system that is consistent, transparent, and fair to both landlords and tenants.

We anticipate that the consultation will begin shortly. Anyone interested in rent setting or the review of the HRASS please contact us.

New ASB report for community activists

The Home Office has published Baroness Newlove's report showing how community activists can tackle anti-social behaviour (ASB). Baroness Newlove, whose husband Garry was kicked to death by a drink and drug fuelled gang of youths, has visited activists up and down the country to find examples of how communities and the authorities are working together against ASB. The report our vision for safe and active communities is written by an activist for activists and contains many good practice examples showing how groups of volunteers have formed to rid their local area of ASB. It provides advice and ideas for local communities working with police, local authorities and social landlords to uphold the law and enforce tenancy conditions. From a landlord's perspective, the report provides a useful insight into current practice and strategies for tackling ASB that can be shared with residents. The recommendations include:

'Community Reward' – where information provided by the community leads to a conviction the community is given a reward to spend on crime prevention work

'Bling Back' – where money made from selling local drug dealers’ assets is handed back to the neighbourhood they blighted

letting communities set their own local speed limits

taking crime maps to the next level so people can use them to report crime and ASB and agencies can publish details of what action was taken against offenders

giving the public a single point of contact through the roll out of the 101 number to report ASB

providing council tax rebates, or vouchers for local businesses and services, for people who take part in activism

asking Police and Crime Commissioners to commit at least one per cent of their budget to grass roots community groups to use or have a say on

Our Vision for Safe and Active Communities is available to download below.

If you have any views as to the reports findings, conclusions and recommendations we would love to hear from you.

The document can be accessed by clicking here: http://www.homeoffice.gov.uk/publications/crime/baroness-newlove-report?view=Binary

Supporting People Review

As you may be aware the final report of the Supporting People Review was published in Nov 2010. The head of the government-commissioned study, Professor Mansel Aylward, said of the supporting people programme that the £140 million supported housing scheme could be more efficient. Speaking at the Chartered Institute of Housing Cymru’s Tai 2010 conference, he said the scheme ‘his review would look at simplifying the system, and making it more efficient and accountable’. Talking to people who benefit from the services and seeing the difference it makes to their lives had convinced him the programme should be kept, he said.

Deputy housing minister Jocelyn Davies ordered the review in 2009, to ensure the scheme is being delivered efficiently. In 2009-10 £138 million was spent on Supporting People in Wales. It has been allocated £141 million for 2010/11. The review aims to ensure housing support services are tailored to individual need and high quality support that demonstrates value for money is delivered.

The Assembly Government are now working towards the implementation of the recommendations contained within the report these include:

Work on establishing a measure of the value for money of the programme

Reviewing the work done by LE Wales on distribution and working up recommendations around a funding formula

Considering the outcomes pilot and how outcomes from the SP programme can be robustly evaluated and collected

Working up recommendations around the future structure and administration of the programme

Conclusions on how the regulation of the programme can be improved

Undertaking a “following the money” exercise tracing funding from WAG to service users.

A copy of the report and questions relating to the implementation of the programme can be found here: http://new.wales.gov.uk/topics/housingandcommunity/housing/supportingpeople/supportedreview/finalreport/?lang=en

Guidance for Local Authorities on Allocation of Accommodation and Homelessness'

The Deputy Minister for Housing and Regeneration has issued 'The Code of Guidance for Local Authorities on Allocation of Accommodation and Homelessness' along with the consultation questions relating to the report. You can access the document via the housing homepage on the Welsh Assembly Government website or by going here:

http://wales.gov.uk/consultations/housingcommunity/codehomelessness/;jsessionid=lSYyNJ8PKNTXSLHSNkHpnDCLLBzv24KChGYnmsQdRTJpjp99dGMB!-301227275?lang=en

Although the document is mainly targeted for allocation and homelessness practitioners, chapters 2 and 7 give a flavour of the impacts of the amended guidance.

The slow death of the ASBO?

ASBO or the Anti Social Behaviour Order has been with us for 11 years. First launched in 2000 as a major tool to tackle the anti social element of the youth culture the government is now considering doing away with the controversial tool in place of more localised controls by communities and local government. The approach has been outlined by the home secretary Teresa May MP who has outlined her plans which has been heralded as the most significant reforms of policing in the country for 50 years. The home secretary wishes to replace the bureaucratic accountability that has meant police forces looking to Whitehall, and targets and bureaucracy. With democratic accountability: the election of a police and crime commissioner for each police force to represent peoples needs locally, the home secretary has stated these reforms will make policing more accountable. She also announced the strengthening of the way we deal with serious organised crime by creating a FBI type organisation: The National Crime Agency.
Since the launch of ASBOs in 2000 there has been more than 17,000 ASBOs issued in England and Wales. With the oldest being 88 years and the youngest just 8 years. The controversial approach supported by parents and communities alike at the time was claimed to put a halt to offending behaviour. However, it has had mixed reviews over the past decade. While the ASBO itself firmly said to offenders the next step is jail, only 5,000 offenders actually went to jail despite more than 55% of ASBOS being breached. Supporters of the approach say that the ASBO was never meant to be a solution to a problem but one tool in the armoury of the police, judiciary and agencies that wanted to work with offenders.
For many in social rented housing it was a knee jerk and populist approach to dealing with crime and nuisance on housing estates popularised by the media. It did however send a clear message to wanna-be-gangsters who sought to cause nuisance in the community the threat of having an ASBO early in your life could wreck your chances of employment and opportunity for years. In a recent Welsh Tenants Seminar held in Swansea and Rhondda there were clear support for the use of these measures, however with varying degrees of success, while the cost of issuing and monitoring ASBO also came under criticism. In Swansea it was reported that ASBOs were a useful deterrent that enabled crime enforcement and educationalists to work proactively with youngsters on offending, while in the Rhondda the tool was also extensively used to target hot spots of nuisance. Whatever the verdict the intention of the government’s revised approach is to do away with them.

If you want to comment on the proposals the full reforms are outlined in the paper Policing in the 21st century: Reconnecting police and the People. If you want a copy of the report can be obtained by emailing Nigel.Lawrebnce@homeoffice.gsi.gov.uk or by visiting the home office web site.

Statement on the overhaul of the Housing Revenue Account System

Many members and supporters of the Welsh Tenants Federation would have seen the news reports in the Western Mail on the 13th September 2010, ‘Wales loses £1bn to London in ‘rent scandal’ by Martin Shipton. The report highlighted that over £1billion has been sent back to the HM Treasury since devolution from Council House rents.

The Housing Revenue Account Subsidy System requires that any surplus be sent back to the HM Treasury and redistributed among all England and Wales Local Authorities who still retain their stock. The report highlighted that given the condition of some of the stock in Wales this was a scandal and that the system is in need of overhaul.
An Independent reviews of Housing Revenue Account Subsidy (HRAS) and Social Sector Rent Policies were launched by the Welsh Assembly Government in 2009. The groups were set up as a consequence of the Essex review which has the objective of working collaboratively with the sector to address the common themes of the report. The joint working group looking at the HRA and Rent Setting process comprises key stakeholders and officials, the Welsh Tenants Federation among them and has met on three occasions.
In general the HRAS applies to all local authorities with housing stock and, in Wales, all authorities are in a negative subsidy position. This means that in 2010/11, approximately £78m will be collected from Welsh local authorities and forwarded on to HM Treasury.
Options for reform for Wales are currently in development, through the Review, working in conjunction with the Welsh Local Government Association and others. It is impossible to make substantial changes to the arrangements without a negotiation with the Treasury and possibly changes to primary legislation and devolved funding arrangements.
Tenants in England will be aware through the Tenants And Residents Associations Of England (TAROE), our sister organization, that the former UK Government launched a consultation in March 2010 which proposed a settlement with local government in England abolishing the HRA Subsidy in return for an allocation of debt and other conditions. If there is agreement, the former Government proposed to work towards voluntary implementation from 2011/12, subject to confirmation at the next spending review in October 2011.
Alternatively, they would seek to implement self-financing through new primary legislation as early as 2012/13. We can report that the Assembly Government is liaising closely with the Department for Communities and Local Government to monitor progress on the review in England and to ensure that provisions within the forthcoming Decentralisation and Localism Bill, announced in the Queens Speech, are appropriate for Wales and made in the Welsh context
The Welsh Tenants Federation shares the concern regarding the impact of the HRAS on local authorities in Wales. In 2003 we had a substantial debate among the 320 member organisations and produced the manifesto which supported tenants who wished to transfer their stock forming new community mutual’s or housing associations. The newly formed transfers have been able to spend 100% of their revenue with no restrictions with the overhanging debt being written off by HM Treasury. This has enabled considerable investment of £1.17bn to be levered into former council housing to meet Welsh Housing Quality Standard while creating substantial employment and regeneration opportunities. We will continue to support tenants who wish to transfer in order to get better services and standards of housing.
Steve Clarke, Managing Director, Welsh Tenants Federation

Welsh households feeling the strain of the recession

Nearly 50 per cent of adults in Wales who have a mortgage or rent struggle with their payments at least some of the time, while 23 per cent say that housing costs are a source of anxiety, according to new figures published today [Thursday 1 July].
The survey, carried out for Shelter Cymru by YouGov, asked more than 1100 Welsh adults about their housing situations. The findings reveal that:
• 49 per cent of adults in Wales who have a mortgage or rent struggle to keep up or fall behind with their payments at least some of the time.
• Housing costs are a source of anxiety for 23% of households.
• More than half (51%) are concerned that their children will not be able to afford a decent home. This rises to 62% of 35-44 year-olds and 72% of 45-54 year-olds.
• In the last two years, nearly a quarter (23%) of those responsible for rent or mortgage payments have had to reduce the amount they spend on food to meet rent/mortgage costs. This rises to 32% among 18-24 year-olds and 27% among 25-34 year-olds.
• 18 per cent of those responsible for mortgage or rent payments have increased the use of credit cards to meet day-to-day expenses in the last two years. This rises to 27% among 35-44 year-olds.
• One in ten are concerned about their ability to pay their rent/mortgage and feel insecure in their housing.
• 14 per cent of those responsible for a mortgage or rent have had to reduce the amount they spend on heating to meet rent/mortgage costs in the last two years.
John Puzey, director of Shelter Cymru, said: “The survey findings clearly indicate that people in Wales are still feeling the effects of the recession. Housing costs are a source of anxiety for many, while others have had to increase their use of credit cards to meet everyday expenses, which is likely to lead to greater debt problems further down the line.
“It is also telling that so many people are worried that their children will not be able to afford a decent home. The simple fact is that there are not enough affordable homes available to buy or rent in Wales.
“The property bubble that fuelled much of the current economic crisis put a decent home beyond the reach of many and the severe cuts announced in the recent Budget are a further threat to the provision of affordable homes.
“However, despite the squeeze on public spending, affordable housing should not be allowed to slide down the political agenda. It is not just a matter of bricks and mortar – investment in homes is also an investment in health and well-being, education, training, skills and sustainable communities.”
The significant minority of households who report that they have had to reduce the amount they spend on food or heating to meet housing costs was also a source of great concern, said Mr Puzey.
“As benefit cuts start to take effect, many households will see a drop in their income, and more vulnerable people will have to make difficult choices about whether they should pay for food or heating or risk falling into arrears with their rent or mortgage.
“Shelter Cymru believes that this is unacceptable. A decent, secure home should be a fundamental right for everyone in Wales and the provision of affordable housing needs to be recognised as an essential factor in the health, well-being and prosperity of our people and communities.”
Notes
All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1121 adults. Fieldwork was undertaken between 26th - 31st May 2010. The survey was carried out online. The figures have been weighted and are representative of all Welsh adults (aged 18+).