Cabinet Member for Housing
Decision:
It was RESOLVED: -
1.1 That Cabinet approved the Rent and Service Charge Policy attached in Appendix A with the following decisions:
A – That rent flexibility is not applied.
B – That rents in certain Temporary Accommodation, which is excluded from the rent standard, may be set at LHA rates
C – That service charges are de-pooled.
REASON FOR DECISION
A – That rent flexibility is not applied. Due to the current economic climate and challenges around affordability for the Council’s tenants, Rent Flexibility will not be used for any new tenancies. Should there be a requirement to change this decision and adopt any level of Rent Flexibility, a decision will be taken by full Council and will have a clear rationale, considering local circumstances and affordability. Tenants will be consulted about the proposals and their views taken into account by the Councils.
B - That rents in certain Temporary Accommodation, which is excluded from the rent standard, may be set at LHA rates. The Policy provides for both BMSDC to continue to set rents at LHA in circumstances such as this, where the Rent Standard and Rent Policy Statement do not apply. Doing so provides greater opportunity to provide temporary accommodation in new settings and maximise income for the HRA.
C - That service charges are de-pooled. It is generally considered to be inequitable to fund or to subsidise the cost of services from the general rent pool, and fairer to charge the cost of services to those tenants who benefit directly, referred to as ‘de-pooling’. De-pooling service charges will free-up limited funds of within the HRA budgets which are currently subsidising services to meet changes in national housing policy which benefit all tenants. Exemptions to this rule could be made if its application meant that a service became unaffordable, as could be the case with some support services. In these cases, the service charges would be pooled across multiple locations.
Alternative Options Considered and Rejected:
2.1 The policy sets out how the Councils comply with legislative and regulatory requirements for the most part, although consideration was given to:
2.2 A. Apply rent flexibility, or not
2.2.1 Rent flexibility is described in section 4.4 of Appendix B, and in paragraph 3.7 of the draft policy. The Government’s Rent Policy Statement recognises the need for discretion over rent levels to take into account local factors and concerns. In summary, Councils have the option to apply an increase to social rents above ‘formula rent’ at the point of letting a property, to generate additional income for the HRA. Use of the flexibility should take account of local conditions and be used following consultation with tenants and other key stakeholders.
2.3 B. Rent setting in Temporary Accommodation Excluded from the Rent Standard
2.3.1 Leased properties used for temporary homeless provision are excluded from the requirements of the RSH Rent Standard if certain criteria are met. This is described in paragraph 4.7 of this briefing, section 4.10 of Appendix B, and 3.21 of the draft policy. The option is to set these rents at formula rent, or at a higher rate to match LHA.
2.4 C. ‘De-pool’ service charges, or not.
2.4.1 Where a service is not fully accounted for in a service charge to the tenant receiving the service, the service is funded (partly or in full) by the general rent pool. Changing this approach, to charge for services only to tenants who receive them is referred to as ‘de-pooling’.
Any Declarations of Interests Declared: None
Any Dispensation Granted: None
Minutes:
20.1 The Chair, Councillor Arthey invited the Cabinet Member for Housing, Councillor Osborne to introduce the report
20.2 The Cabinet Member for Housing provided an overview of the Rent and Service Charge policy and corrected paragraph 4.7.3, page 278 in the draft Rent and Service Charge Policy, which should refer to ‘appendix a’.
20.3 The Cabinet Member moved the recommendations in the report, which was seconded by Councillor Busby.
It was RESOLVED: -
That Cabinet approved the Rent and Service Charge Policy attached in Appendix A with the following decisions:
A – That rent flexibility is not applied.
B – That rents in certain Temporary Accommodation, which is excluded from the rent standard, may be set at LHA rates
C – That service charges are de-pooled.
REASON FOR DECISION
A – That rent flexibility is not applied. Due to the current economic climate and challenges around affordability for the Council’s tenants, Rent Flexibility will not be used for any new tenancies. Should there be a requirement to change this decision and adopt any level of Rent Flexibility, a decision will be taken by full Council and will have a clear rationale, considering local circumstances and affordability. Tenants will be consulted about the proposals and their views taken into account by the Councils.
B - That rents in certain Temporary Accommodation, which is excluded from the rent standard, may be set at LHA rates. The Policy provides for both BMSDC to continue to set rents at LHA in circumstances such as this, where the Rent Standard and Rent Policy Statement do not apply. Doing so provides greater opportunity to provide temporary accommodation in new settings and maximise income for the HRA.
C - That service charges are de-pooled. It is generally considered to be inequitable to fund or to subsidise the cost of services from the general rent pool, and fairer to charge the cost of services to those tenants who benefit directly, referred to as ‘de-pooling’. De-pooling service charges will free-up limited funds of within the HRA budgets which are currently subsidising services to meet changes in national housing policy which benefit all tenants. Exemptions to this rule could be made if its application meant that a service became unaffordable, as could be the case with some support services. In these cases, the service charges would be pooled across multiple locations.
Supporting documents: