Will welfare reform address problems rather than creating greater ones?

This post is not about the pros and cons of welfare reform.  I think many of the ambitions behind welfare reform are to be welcomed. Rather, this post looks at the practical implementation of these measures and some unintended consequences.

Regarding the Bedroom Tax (I feel I can call it that given that on Monday a government minister at a conference organised by Crisis accepted that that is the phrase he uses) is resulting in a large proportion of tenants failing to pay the resulting shortfall in their rent.  Riverside Group has revealed that around half of its 6,000 households receiving housing benefit had not paid anything at all to cover the shortfall.  A quarter had contributed something but were not paying their rent in full.  Just one in four tenants impacted by the bedroom tax paid the full amount.

Guinness Partnership said that around 1,000 of their 3,000 tenants affected by the under occupation regulations have not met the shortfall.  Their experience is similar to a number of other housing associations around the country.  Inside Housing is covering this issue on its front page in today’s edition.

Because we tend to work almost exclusively with single homeless people, and our housing stock is largely one-bedroom flats, this is not an issue amongst our tenants. However, I would anticipate that, in due course, we will begin seeing tenants of other social landlords presenting at our advice centres in Brighton, Eastbourne and Hastings requiring assistance because they are facing eviction.

There have been warnings about this which have gone largely unheeded.  A more widespread risk relates to the payment of rent direct to tenants rather than to landlords.  This will undermine the confidence of private landlords to take people who are receiving housing benefit, see an increase in arrears and bad debts faced by landlords in both the private rented and social sectors, and cause a loss of confidence amongst financial institutions who lend money for the building of homes for rent.

Julian Ashby, the chair of the regulation committee at the Homes and Communities Agency has warned that housing providers face being hit by a ‘double whammy’ of increased rent collection costs and reduced income due to welfare reform.

In a report published today by Housemark, it has been estimated that social landlords face losing £1.4 billion of rental income a year as a result of welfare reform.

There is also concern amongst social housing providers regarding the move to making claims online.  In a survey taken in November 2012, Ipsos Mori showed that just 60% of local authority tenants and 64% of housing association tenants had access to the Internet.  I’m not aware of any similar research regarding tenants in the private rented sector but, given the efforts taken by social landlords to increase digital inclusion, and in the absence of a similar programme in the private rented sector, I would imagine digital inclusion is much, much lower.

BHT did its own survey around that time and we found that79% of our clients, tenants of both private and social landlords as well as some owner occupiers, and meaningful access to the Internet.  However, when you remove the provision made available to our clients by BHT itself, that number falls to 19%.

There is still time for the government to pause and think about whether it is going about these matters in a way that will address problems rather than creating greater ones.

BHT and partner QED get the go-ahead for our container housing scheme

At BHT we are very excited to have secured planning permission for the proposal to provide temporary homes in converted shipping container at Richardson’s Yard, Brighton. The scheme is a joint venture between BHT and our development partner, QED Property. What was particularly gratifying was the unanimous support received from members of the Brighton and Hove Planning Committee.

Planning officers recommended approval, saying that the containers were an “imaginative and appropriate” way to meet a very real need for affordable accommodation.

To find out more you can read various post from the last few months:

How BHT hopes to use shipping containers for temporary accommodation for homeless men and women

Reaction to BHT’s plans to provide temporary accommodation in converted shipping containers

Support for our container housing application from the local action team

Some concern on the BBC website this morning focused on a report that the land is ‘contaminated’ and that it would not be suitable for permanent housing.

Richardson’s Yard has been used as a scrap metal yard, and there is, inevitably, some contamination, including from oil. However, a full environmental assessment has been made and was considered by the Council before permission was granted. The plan is to place a membrane on the contaminated land before a concrete base in put in place. All planting areas will be in raised beds and there will be no risk to future residents. If there was the slightest risk, BHT would not risk the health and wellbeing of our residents.

This is an exciting development and I look forward to seeing the first residents move in at the end of the summer (assuming we have a summer!).

Where is the justice or common sense in continuing with the Right to Buy?

A young woman from Lithuania, 25 year old Judita Simkeviciute, has secured a three bedroom council house in an area where she has no local connection and where there is acute housing shortage for local people.

No, you haven’t accidently strayed onto the Daily Mail Online website.  In all regards, other than one fact, this is the sort of story that would normally outrage the good folk who run the Daily Mail.

The missing fact is that Ms Simkeviciute bought the former council house sold through the Right to Buy.

The house in question was first bought in August 1980 for £8,315 after the original tenants qualified for a 40% discount.  It has been sold on a further four times, in 2001 for £101,000, in 2004 for £145,000, in 2007 for £183,000 and now for £180,000.

I have always had a problem with the Right to Buy.  Having spent public funds building (and probably refurbishing) the property that the original tenants secured because of their housing need, how is it right that it can then be sold to achieve huge profits, a real case of something for nothing.

I understand the populism of this policy for the lucky few, but with one in three former council houses now part of the buy to let market, I do not understand the economic or justice arguments for continuing this policy.

Support for our container housing application from the Local Action Team

I am delighted that the London Road Area Local Action Team has written a letter in support of the planning application by QED and BHT for 36 temporary homes to be provided in converted shipping containers at Richardson’s Yard off New England Hill.

The planning application number is BH2013/00245.  The Chair of the London Road LAT, Philip Wells, has written:

“I have been mandated by the London Road Area LAT meeting to write in support of this application. Representatives of BHT and developers have attended at least three open meetings on this subject.

“The majority of members present at the meeting 19th March 2013 and at previous meetings felt that this was an imaginative and appropriate provision to meet a very real need in Brighton for affordable accommodation for people making a genuine effort to get back into mainstream life in our city.

“Although the spaces concerned started life as shipping containers this is best thought of as a recycling venture resulting in comfortable, if quirky, well-equipped, energy-efficient dwellings. Some of our members’ accomodation is smaller than these units!

“The developers might consider giving the final edifice a brightly coloured finish, which would emphasise rather than attempt to disguise, the imaginative and unusual features of the housing provision.

“It would be only fair to mention the concerns that were raised by a small minority of members. This concern reflects the perception that London Road has more than its fair share of “street drinkers, drunks and drug users” – to put it most crudely – and that this development might seem to add to these problems rather than contribute to their solution.

“However the BHT CEO Andy Winter gave assurances, over and above planning considerations, that tenants would be assessed for suitability and great care would be taken that any problems of this nature would be remedied. This management would thus be comparable with similar existing accommodation in Ditchling Rise where no problems have come to the attention of the community as far as we are aware.

“Indeed we would hope possibly to welcome tenants to future LAT meetings as a helpful contribution to the community life of the area.”

Ill-considered statements about immigration and housing can play into the hands of racists

Last week the Prime Minister, David Cameron, announced plans to limit the availability of social housing for non-EU immigrants. We have been led to believe that local English-born citizens are being denied housing because immigrants are ‘jumping the housing waiting list’.

The reality, though, is much different. The Communities Secretary, Eric Pickles, has reported that just 9% of social lettings were to non-UK born households. Yet in 2011, 13% of the population of England were born overseas. That means immigrants are less likely to secure social housing than the rest of the population.

Most local authorities have local connection policies. It is very unlikely that those new to an area, including those from elsewhere in England, will get social housing. There are no figures showing the number of overseas-born households getting social housing within two years of arriving in England. But according to Inside Housing, anecdotal evidence from social landlords “suggests that the figure is close to zero”.

Yet in spite of the facts, there is a perception that “the indigenous community” is being squeezed out of housing by incomers. There are anecdotes about newly arrived households moving into social housing and, for some in the media, anecdote is more compelling that fact.

But there is some basis for these anecdotes: the illegal sub-letting properties, and the right to buy.

There are believed to be 160,000 social tenancies that are illegally sub-let. Those in most need can include newly arrived households who are exploited and required to pay rents well above those being paid by the social housing tenants to their landlords. It is understandable that neighbours, whose own family members might be on the waiting list, conclude that a newly arrived household have secured social housing when the reality is that they are being exploited, with no rights and paying the highest rents.

One in three properties sold through right to buy are now being let within the private rented sector, yielding rents far in excess of those previously paid to social landlords. (There are clear lessons to be learned here regarding the increasing housing benefit bill). Again neighbours might conclude that their family member has again been disadvantaged, believing that the flat next door has been let through the local authority to newly arrived landlords when it has, in fact, been transferred to the private rented sector.

The only beneficiaries of this situation are those who are exploiting housing need (including those illegally sub-letting social housing) and the far right who seek to ferment racial discord, often in areas with a mix of high cost housing, housing shortage, and large immigrant communities.

I think politicians should be very cautious before they make pronouncements that are not based on facts on an incredibly emotive subject.

South African housing delegation visits Brighton

A delegation of housing experts from South Africa has visited Brighton and Hove. The delegation was led by the Deputy Minister for Human Settlements, the Honourable Zoliswa Kota-Fredericks, and the Chief Executive Officer of the Southern African Housing Foundation, John Hopkins.

During the visit the delegation was received by the Mayor, Cllr Bill Randall, and met with various housing leaders in the City including the Chair of the Housing Committee, Cllr Liz Wakefield.

This annual event is a particular joy for me as I was born and brought up in Cape Town where most of the delegates come from.  It is inspiring to hear how our South African colleagues are coping with huge challenges, and it was an honour to show them some of BHT’s work tackling addiction and homelessness.

The delegation toured various development sites including the Open Market and a site in Wellington Road where the first council houses to be built in the City for twenty years are nearing completion.

Minister Kota-Fredericks was particularly interested in the possibilities of partnerships between the public and private sectors, and to learn what works and what problems there have been.

I liked the concept of ‘human settlements’ that goes above and beyond housing on its own.  The proposals for Toads Hole Valley is an example of this, what in the UK is referred to as one world living.

The delegates are today attending the Chartered Institute of Housing conference being held at the Metropole Hilton.

The invaluable work of advice services, services which are now under threat

In today’s Argus there was a report on the prosecution by Hastings Borough Council of a landlord for ignoring a property improvement notice. The landlord, who is well known to BHT’s Hastings Advice Centre in Hastings, failed to deal with damp, fire safety and domestic hygiene hazards. He was fined £4,250 and ordered to pay full costs.

The Argus quotes Cllr Kim Forward, Hastings’ lead member for housing: “We are sending a clear message to the landlords in our town who do not comply with the regulations which ensure their tenants are adequately protected. We will not tolerate poor housing, and if you won’t work with us to improve your property if it is substandard, you can expect us to use the full force of the law against you.”

What did not come across in the article was the persistent and sterling efforts of BHT staff who pursued this case for over 12months. With reforms to legal aid and the squeeze on funding from local councils, our ability to take on cases like this will be severely limited.

BHT advice staff are often not recognised for their work. They deal with issues like this on a daily basis and, as a result, can receive abuse and threats from certain landlords (although most landlords are dedicated to providing a good service and are responsive to the welfare of their tenants). At the same time advice staff cope with clients who can be challenging. They then have the backdrop of the uncertainty over their future because of funding cuts.

A civil society should be judged by how it treats the weakest and most marginalised of its community. BHT Hastings Advice, with Hastings Borough Council, have shown how a civil society should respond to poor housing. It is a shame that such services are under threat.

Temporary housing in converted shipping containers: Notes from the public meeting arranged for neighbours of the proposed site

Here are some notes I made at a public meeting held on Friday 4 January 2013 which BHT and our partners, QED Property, had organised for residents and businesses neighbouring Richardson’s Yard, the site at the bottom of New England Hill (behind the Cobbler’s Thumb pub) where BHT and QED are seeking planning permission to locate 36 converted shipping containers to be used as temporary housing.

Chris Gilbert explained that the site is an employment generating  site but there are no firm plans for its redevelopment for the five years for which we are seeking planning permission. Therefore, we are proposing to use the site through this planning application.

I explained to the meeting that BHT, who will manage the accommodation, intends to allocate it to people who are in housing need.  They will be carefully screened to ensure that the prospective tenants are “tenancy ready”. We are currently working with people, for example, who are holding down jobs but, because of the housing market in the city, are living in cars and vans. Consultation we have undertaken with BHT clients has suggested that this will be sought after accommodation because it will be self-contained and residents will not be required to share bathrooms and kitchens with other households.

As far as BHT is concerned, we cannot afford to get this wrong since we have both finance and reputation at risk. We also want to prove through this pilot that the use of converted containers can provide viable, attractive and sought after accommodation.

It was suggested that there may be concerns about using this site for temporary housing given the perceived problems associated with the drug clinic that was previously located in the neighbourhood. I assured the meeting that, while BHT has a proactive housing management approach including policies and procedures relating to antisocial behaviour, we did not envisage any significant issue beyond that which might be found in any housing development, private or public. I acknowledged that management is the key. There will be a named contact person and telephone number should any issues arise.

I was asked and agreed that there should be post occupancy reviews to see how the scheme has worked, monitor the heating costs and experience of residents in order to make an informed assessment of its success.

Ross Gilbert spoke about the joint work between QED and BHT’s Client Involvement unit and food charity Harvest who, together with QED, are looking at the management of the planting areas on the site. There will be 25 m² of raised beds to be used for the growing of food.

Ross also explained that, while the containers would not meet current building regulations regarding thermal mass, the combination of thermal mass and air tightness means that good levels of thermal comfort can be achieved. There will be a communal plant for heating with traditional wet radiators.

There was concerns expressed regarding parking and we were asked to ensure that all residents were unaware that they would not be eligible for a permit for the surrounding Controlled Parking Zone.

Probably the most interest and debate at the meeting related to the decoration of the converted containers! Some people thought that we should be bold, recognising that they are converted shipping containers, and that this is Brighton! Street art was suggested as one possibility with Chris Gilbert saying he thought we should do something a bit funky! I am somewhat conservative by nature and I’m not sure about street art although I could be persuaded to have the units painted in bright colours.  I agreed to consult clients about what they think.

It was suggested that we consider establishing green walls. However, it is unlikely that we would be able to cultivate anything adequate in the five years planned for the scheme, and to acquire mature growth to cover the exterior and walls would prove to be financially prohibitive. While it would be lovely, it is unlikely to happen.

It was suggested that we should not be defensive about this proposal (I don’t think we are!) and acknowledge that the development will be bringing something positive to the neighbourhood. There was a consensus at the meeting that this would be a development that clients and neighbours could be proud of.

There was some debate about what we should call the development. Everyone agreed that we should retain the word “Yard” as it is currently known as Richardson’s Yard.

Finally, when it was suggested that a named person should attend the London Road LAT, I said that I was already a member but it was likely that residents would wish to become involved themselves. This was warmly welcomed.

I was really encouraged by the very positive response from those present. I think this is a great scheme, and I think that Ross Gilbert should be praised for his vision, Chris Gilbert for his commitment, and Scott Marshall for his sage advice!

If you were at the meeting, please let me know if you think I have missed anything that was raised.  If you weren’t please feel free to comment about our plans.

Meeting housing need requires cross-authority co-operation in Sussex

Martin Randall, head of planning and public protection at Brighton and Hove City Council, has called on neighbouring authorities, including the South Downs National Park Authority, to help the region meet housing need.  I think Martin is absolutely right.  The National Housing Federation has said that the number of new homes needed in East Sussex alone is set to increase from 354,600 in 2012 to 434,000 by 2033.

Yet the National Housing Federation has reported that Sussex Councils have reduced their house-building targets for the next 15 years by 43%. In Mid Sussex the target has been reduced from 17,100 to just 10,600.

Neighbouring authorities may not like it, but the Brighton and Hove economy is the powerhouse within the region and the well-being of neighbouring authorities, including Adur, Worthing, Crawley, Lewes, Mid Sussex and others, depend on a balance provision of housing and jobs across all authorities.

Eastbourne Borough Council deserves praise, having increased its target from 4,800 new homes to 5,022, and Worthing which has maintained its 4,000 target.

Brighton and Hove, under successive administrations, has had vision regarding the provision of housing, its economic success and that of the sub region. Far from Brighton and Hove trying to push housing need onto neighbouring areas, as claimed by the leader of Crawley Borough Council, the City Council is doing what it can but wider co-operation is necessary if we are to meet the housing needs of our children and others, and for the ongoing success of the sub regional economy.

 

Will 2013 and the introduction of Universal Credit see an improvement or worsening in arrears, bad debts and evictions?

 

One of the biggest challenges for all providers of rented accommodation, either in the social or private sectors, will be the impact of further welfare reform, in particular the introduction of Universal Credit and payments direct to tenants.  For tenants, there will be an increase in their responsibilities and consequences for not getting it right.

A new YouGov survey published today by Shelter has estimated that 1.4 million Britons are falling behind with the rent or mortgage payments.  The number of people struggling to pay their rent or mortgage each month has increased by 44% over the past year, to 7.8 million people.  The research also reveals that over the past year:

• almost a million people used a payday loan to help pay their rent or mortgage
• 2.8 million people used an unauthorised overdraft to help pay their rent or mortgage, and of those 10% did so every month.

There is a wide political consensus on the need for welfare reform.  Many of the objectives of Universal Credit are laudable, not least the implementation of the system and the ambition that work should always pay.  I have a particular concern: that the implementation on the ground will result in problems for claimants and landlords alike.  There have been warnings that the systems necessary will not be in place nor robust enough.  The pilots on payments to tenants have not been encouraging and there have been worrying increases in arrears.

The government, MP’s and the DWP have had sufficient warnings about the state of readiness.  Reassurances have been given at each turn.  I hope they are right.  However, I know from BHT’s own research, the expectation that claims be made online are a long way from reality in spite of work being done with social housing tenants.  Only a few of us are doing much for tenants in the private rented sector who are particularly vulnerable.

The consequences of significant problems in the implementation of Universal Credit, to claimants and landlords alike, are grim.  Tenants will get into arrears and face eviction. An increase in arrears and bad debts, will see some associations failing.  Housing associations have been reviewing their risk maps, with welfare reform now at the top of their risk registers.  Private landlords will become even more reluctant than they are at present to offer tenancies to claimants.

The Shelter / YouGov survey shows the situation before the impact of welfare reform.  I hope that in a years time the simplified system will see an improvement in arrears and evictions.  Sadly I think the situation will have only worsened.  I sincerely hope to be proved wrong.