Consultation outcome

Implementing the new consumer regulatory regime: directions to the Social Housing Regulator on mutual exchange and tenant involvement

Updated 23 June 2023

Applies to England

Scope of the consultation

Topic of this consultation:

This consultation seeks views on proposed Directions from the Secretary of State to the Regulator of Social Housing, using powers under section 197 of the Housing and Regeneration Act 2008 (“the 2008 Act”).

The Social Housing White Paper included a commitment to introduce a proactive consumer regulation regime. We have reviewed the existing directions covering tenant involvement and mutual exchange (PDF, 69KB) to ensure they are suitable for the new regulatory framework.

Scope of this consultation:

Section 197 of the 2008 Act gives the Secretary of State the power to direct the Regulator of Social Housing (‘the Regulator’) in relation to certain matters. Once issued, the Regulator must comply with the direction. We propose to use this power to:

(a) revoke the ‘Tenant involvement and empowerment’ and ’Mutual exchange’ paragraphs of the Directions on Regulatory Standards made by the Secretary of State on 1 March 2012; and

(b) direct the Regulator to set revised regulatory standards (and the content of those standards) on tenant involvement and mutual exchange, and to have regard to specified objectives when setting the tenant involvement standard.

These directions will apply to the social housing stock of all registered providers of social housing, unless specifically exempted. The term ‘registered providers’ encompasses:

• private registered providers (including housing associations)
• local authority registered providers (i.e. local authorities with social housing)

The proposed directions are included in Annex B.

We are not consulting, at this point, on any other changes to the Directions on Regulatory Standards. It is the government’s intention to consult on directions at a future date on quality of accommodation, tenancy, provision of information to tenants, and competency and conduct.

The rent direction, and associated policy statement, has been consulted on separately.

Geographical scope:

These proposals relate to providers of social housing based in England registered with the Regulator of Social Housing and subject to its regulatory standards. They will mainly affect tenants of social housing in England.

Impact on the sector:

The changes will have a minimal impact on the sector. The majority of the measures do not have a monetisable cost and are aimed at ensuring there is behavioural change in the sector and that it becomes more tenant focused. We welcome evidence on areas where the proposed updates to the direction could have unforeseen cost burdens.

The government’s New Burdens Doctrine is clear that anything which could issue a new expectation on local government should be assessed for new burdens. New burdens will only apply in relation to the 30 local authority registered providers without a housing revenue account. DLUHC will conduct a new burdens assessment into the changes set out in this consultation, assess their impact on local government, and, where necessary, fully fund the net additional cost of all new burdens placed on local councils.

Monitoring and review:

These directions form one part of the changes we are making to the consumer regulatory regime. The department will work with the Regulator to conduct a full review of the new regime after a four year regulatory cycle is complete.

Basic information

Body/bodies responsible for the consultation:

Department for Levelling up, Housing and Communities (DLUHC).

Statutory consultees:

• the Regulator of Social Housing
• the Homes and Communities Agency (known as Homes England)
• the Greater London Authority
• bodies representing the interests of local housing authorities
• bodies representing the interests of tenants of social housing
• bodies representing the interests of registered providers
• the Charity Commission

The department will consider any consultation responses received from other interested bodies and individuals.

Duration:

This consultation will last for 6 weeks from 16 February to 30 March 2023.

Enquiries:

For any enquiries about the consultation please contact: socialhousingdirections@levellingup.gov.uk

How to respond:

Please note that we are required by law to publish every response to this consultation. Therefore please ensure that your response does not include any material that you are not content for us to publish.

You may respond by completing an online survey.

Alternatively, you can email your response to the questions in this consultation to: socialhousingdirections@levellingup.gov.uk.

If you are responding in writing, please make it clear which questions you are responding to.

Written responses should be sent to:

Social Housing Regulatory Directions
Department for Levelling Up, Housing and Communities
Floor 3 (Mailpoint B12)
Fry Building
2 Marsham Street
London
SW1P 4DF

Please submit your response through only one of the above routes.

When you reply it would be very useful if you could confirm whether you are replying as an individual or submitting an official response on behalf of an organisation and include:

• your name,
• your position (if applicable),
• the name of organisation (if applicable),
• an address (including postcode),
• an email address, and
• a contact telephone number.

Introduction

1. The government has committed to implementing a proactive consumer regulatory regime for social housing. This forms part of wider changes, outlined in the Social Housing White Paper, to ensure tenants are fully protected, have decent quality homes and are treated with fairness and respect.

2. The Secretary of State has the power to direct the Regulator on certain aspects of its regulatory standards^{[footnote 1]}. This consultation proposes revoking the ‘Tenant involvement and empowerment’ and ‘Mutual exchange’ paragraphs of the Directions on Regulatory Standards (PDF, 69KB) made by the Secretary of State on 1 March 2012 (Annex C), and issuing new directions relating to tenant involvement and mutual exchange (Annex B).

3. The Secretary of State currently has powers of direction relating to quality of accommodation, tenancy and rent, which will not be consulted on at this stage. The rent direction was recently consulted on, given the need to provide certainty on rent levels as quickly as possible. The government is committed to reviewing the Decent Homes Standard and plans to review the direction on quality of accommodation alongside any changes to the Decent Homes Standard. The tenancy standard will be revised alongside any changes to Assured Shorthold Tenancies made through the Renters’ Reform Bill.

4. The Social Housing Regulation Bill introduces two new powers of direction: provision of information to tenants, and competency and conduct. Subject to Royal Assent, we will direct on these in due course.

5. The new directions include a number of small, but important, changes to support the smooth implementation of the new consumer regime. The draft directions are attached to this consultation at Annex B. Subject to the outcome of this consultation, we intend to issue the new directions to the Regulator in spring 2023.

6. Once issued formally, the directions will be binding on the Regulator. The Regulator will subsequently conduct a statutory consultation with tenants, providers and other stakeholders on its revision of consumer standards for registered providers of social housing (‘registered providers’). As such, these directions may have an impact on the revision of standards which will affect registered providers and their social housing tenants.

7. These regulatory changes support the overall reform objectives, as set out in the Bill impact assessment: to facilitate a new, proactive approach to consumer regulation so providers of social housing can be effectively held to account for the services they provide to tenants.

8. The proposed directions have no pre-determined end date but they may be subject to change or revision. Any further amendments or changes will require a further consultation.

9. We invite your views on the questions listed and the draft directions by 30 March 2023.

Context

Legal framework for social housing

10. The statutory framework for social housing regulation is set out in the Housing and Regeneration Act 2008. In brief:

• the Regulator has an economic and a consumer objective
• with regard to consumer regulation, the Regulator is responsible for regulating social housing provided by registered providers
• the term registered providers encompasses: - local authorities who have social housing - other bodies that have registered with the Regulator (known as ‘private registered providers’).
• ‘social housing’ comprises low cost rental accommodation (for example homes let at Social Rent or Affordable Rent) and low cost home ownership accommodation

11. The Regulator currently has the power to set regulatory standards on a range of economic and consumer matters. Registered providers are required to comply with these standards. In relation to certain matters, the Secretary of State has the power to direct the Regulator to set standards, to direct on the content of those standards, or direct the Regulator to have regard to specified objectives when setting standards.

Changes to the regulatory regime

12. At present, the Regulator takes a proactive approach to regulating its economic standards, which contrasts with the reactive approach the Regulator is required to take for its consumer standards where currently the serious detriment test is in place (meaning the Regulator can only intervene where a breach or potential breach of a consumer standard has caused or may cause tenants serious harm).

13. The government is reforming the Regulator’s consumer remit; removing the serious detriment test so that the regulator can proactively regulate against its consumer standards. We are also expanding the powers of the Regulator to ensure it has the right tools to effectively carry out this enhanced role. Subject to Royal Assent, changes brought about by the Social Housing Regulation Bill (‘the Bill’) will mean the Regulator can intervene in a greater range of cases where providers have failed to comply with consumer standards.

14. The Bill will introduce a new objective for the Regulator to require registered providers to be transparent with their tenants and extend their standard-setting powers to cover information and transparency. It will also extend the Secretary of State’s powers of direction to cover the provision of information to tenants relating to the management of social housing as well as competence and conduct of individuals providing services on behalf of registered providers .

15. The Regulator has a duty to set standards in accordance with the Secretary of State’s directions and is required to consult on those standards. The Regulator will therefore be carrying out a consultation on a revised set of consumer standards which take into account the final directions to the Regulator as well as the other commitments set out in Annex A of the Social Housing White Paper.

Approach to regulation

16. The Review of social housing regulation: call for evidence and Social Housing White Paper concluded that the co-regulatory approach was effective, putting fundamental responsibility for effective service delivery with the registered provider, alongside scrutiny of compliance and monitoring of performance by the Regulator.

17. It also concluded that co-regulation ensures a focus on driving good outcomes for existing and future tenants. By setting clear outcomes for registered providers without prescribing how these outcomes are met, co-regulation can mean that registered providers are held accountable for meeting outcomes in the way that best meets local circumstances and the needs of tenants, and encourages continuous improvement. Therefore the draft directions are generally outcome-focused rather than prescriptive, except for areas where we believe government policy can only be achieved in a prescriptive way.

Commentary on proposed directions

Tenant involvement

18. We want tenants to be influential voices in the conversations and decisions taken about the management of their homes. The Social Housing White Paper found that some residents felt patronised or ignored by their landlords, rather than truly heard. To address this, paragraph 3(3) of the proposed new direction includes a strengthened requirement for registered providers to offer tenants “a wide range of meaningful opportunities” to get involved with matters relating to their housing and 3(3)(c) requires registered providers to consider tenants’ views when making decisions relating to their housing management.

19. Transparency is at the heart of our social housing reforms set out in the Social Housing White Paper. If tenants are to hold their landlords to account, they need information on how their landlord is performing, what decisions they are making and which aspects of their living conditions are the responsibility of their landlord . Paragraph 3(3) of the proposed new direction extends requirements so registered providers must give tenants opportunities to ”scrutinise” landlord strategies, policies and services. This covers scrutiny of all aspects of social housing management: core landlord activities like rent collection and repairs, plus social value activities like setting up a community allotment or running financial education sessions. As well as having a say on existing management services, tenants should expect to be given opportunities to influence and scrutinise any prospective new services which their landlord may consider introducing and offering as part of their overall management responsibilities.

20. Some tenants will want to set up tenant-led influencing and scrutiny activities, and sub-paragraph 3(3)(a) would require registered providers to take reasonable steps to assist such tenants. This would help tenants overcome practical barriers, such as by providing physical spaces for tenants to meet or providing routes for tenants to raise awareness of their activities.

21. The government remains committed to ensuring that registered providers support tenants to take responsibility for housing management functions, including through exercise of the Right to Manage function where this is appropriate. Paragraph 3(4) of the proposed new direction extends this to specifically include support for tenants to carry out their Right to Transfer, which allows tenant groups to request the ownership of their council homes be transferred from the council to a private registered provider.

22. As set out in the Social Housing White Paper, registered providers have a responsibility to tailor their engagement to the needs of tenants. In line with findings from our research and communications campaign on tenant involvement, we are adding a requirement in 3(3)(b) for registered providers to offer support to meet the diverse needs of tenants who might otherwise struggle to engage with involvement activities.

23. We propose removing the performance information requirements from 2(b)(iii) of the existing direction, which include overly prescriptive requirements in relation to annual reports. We feel tenants are better served by an expanded 3(3), which sets a clear and broad expectation of tenant scrutiny across registered providers’ activities, and avoids the potential for registered providers to take a tick-box approach..

24. We also propose removing references to tenants sharing in savings from the commissioning of repair tasks in reference to the tenant cashback scheme. We feel the addition of broad requirements for tenants to be given opportunities to influence and scrutinise their landlord’s “strategy, policies and services” and be supported to “exercise housing management functions” is more likely to facilitate tenant involvement in social housing provision more broadly and allow for different approaches where appropriate.

25. We propose that the revised direction will require the Regulator to set a standard on tenant involvement that applies to all registered providers in relation to their tenants of low-cost rental accommodation and low-cost home ownership accommodation (shared ownership). We are therefore proposing to remove the exemptions in 1(2) of the current direction (see Annex C).

26. The requirements of the direction will influence the Regulator’s upcoming review of its consumer regulatory standards, specifically those relating to tenant involvement and empowerment. The direction will also be supported by non-legislative measures such as the Resident Opportunities and Empowerment Grant, which will provide grant funding to support social housing residents to effectively engage with their landlords through information, training and capacity building opportunities.

Question 1: Do you agree with the strengthened outcomes we are setting in the direction, as set out in paragraphs 18-22?

Question 2: Do you agree with requirements that are being removed, as set out in paragraphs 23-24?

Mutual exchange

27. The draft direction on mutual exchange retains the existing requirement for registered providers to offer mutual exchange schemes. The intended outcome remains that tenants should be able to easily access the details of as many available matches as possible.

28. The existing direction requires registered providers to provide reasonable support for tenants who may not have access to the internet. There may be other reasons a tenant is unable to independently use a mutual exchange service. Therefore, we are proposing to extend this requirement so registered providers must provide support for any tenant who would otherwise be unable to use the mutual exchange service. We are not seeking to prescribe how support might be offered but we expect this may include support such as:

• access to a computer with internet
• explaining how the mutual exchange service works
• assistance to navigate an online mutual exchange service
• registering and searching for matches on behalf of a tenant

29. This might be suitable, for example, if a tenant had a disability that affected their ability to use the mutual exchange service independently.

30. The previous direction encouraged registered providers to subscribe to a provider within the Nationwide Homeswap Programme. Since that direction was introduced, the number of providers and websites offering mutual exchange services has expanded, making these procedural details unnecessary. We propose removing these details, giving providers greater freedom in how they allow tenants to access mutual exchange services.

31. Whilst we are proposing to remove the exemptions in 1(2) of the current direction (see Annex C), we are not planning to add any bespoke exemptions for mutual exchange as eligibility rules for mutual exchange are already set out in existing legislative provisions .

Question 3: Do you agree with the additional requirement to offer support to tenants who would otherwise be unable to use the mutual exchange service, set out in paragraphs 28-29 ?

Question 4: Do you agree with the proposed approach to remove procedural details, as set out in paragraph 30?

About this consultation

This consultation document and consultation process have been planned to adhere to the Consultation Principles issued by the Cabinet Office.

Representative groups are asked to give a summary of the people and organisations they represent, and where relevant who else they have consulted in reaching their conclusions when they respond.

Information provided in response to this consultation will be published to comply with section 197(8) of the Housing and Regeneration Act 2008. Names of individual respondents will not be published. In addition, responses may be published or disclosed in accordance with the access to information regimes (primarily the Freedom of Information Act 2000 (FOIA), the Data Protection Act 2018 (DPA), the UK General Data Protection Regulation, and the Environmental Information Regulations 2004.

Due to the legal requirement to publish responses, we are not able to guarantee confidentiality in respect of your response. An automatic confidentiality disclaimer generated by your IT system will not, of itself, be regarded as binding on the department.

In addition, information provided in response to this consultation may be published or disclosed in accordance with the access to information regimes (these are primarily the Freedom of Information Act 2000 (FOIA), the Environmental Information Regulations 2004 and UK data protection legislation). In certain circumstances this may therefore include personal data when required by law.

The Department for Levelling Up, Housing and Communities will at all times process your personal data in accordance with UK data protection legislation and in the majority of circumstances this will mean that your personal data will not be disclosed to third parties. A full privacy notice is included below.

Individual responses will not be acknowledged unless specifically requested.

Your opinions are valuable to us. Thank you for taking the time to read this document and respond.

Are you satisfied that this consultation has followed the Consultation Principles? If not or you have any other observations about how we can improve the process please contact us via the complaints procedure.

Annex A: Personal Data

The following is to explain your rights and give you the information you are entitled to under UK data protection legislation.

Note that this section only refers to personal data (your name, contact details and any other information that relates to you or another identified or identifiable individual personally) not the content otherwise of your response to the consultation.

1. The identity of the data controller and contact details of our Data Protection Officer

The Department for Levelling Up, Housing and Communities (DLUHC) is the data controller. The Data Protection Officer can be contacted at dataprotection@levellingup.gov.uk or by writing to the following address:

Data Protection Officer
Department for Levelling Up
Housing and Communities
Fry Building
2 Marsham Street
London SW1P 4DF

2. Why we are collecting your personal data

Your personal data is being collected as an essential part of the consultation process, so that we can contact you regarding your response and for statistical purposes. We may also use it to contact you about related matters.

We will collect your IP address if you complete a consultation online. We may use this to ensure that each person only completes a survey once. We will not use this data for any other purpose.

Sensitive types of personal data

Please do not share criminal offence data or special category personal data if we have not asked for it unless absolutely necessary for the purposes of your consultation response. By ‘special category personal data’, we mean information about a living individual’s:

• race
• ethnic origin
• political opinions
• religious or philosophical beliefs
• trade union membership
• genetics
• biometrics
• health (including disability-related information)
• sex life; or
• sexual orientation.

By ‘criminal offence data’, we mean information relating to a living individual’s criminal convictions or offences or related security measures.

3. Our legal basis for processing your personal data

Information provided in response to this consultation will be published to comply with section 197 of the Housing and Regeneration Act 2008. Names of individual respondents will not be published. In addition, responses may be published or disclosed in accordance with the access to information regimes (primarily the Freedom of Information Act 2000 (FOIA), the Data Protection Act 2018 (DPA), the UK General Data Protection Regulation, and the Environmental Information Regulations 2004.

Due to the legal requirement to publish responses, we are not able to guarantee confidentiality in respect of your response. An automatic confidentiality disclaimer generated by your IT system will not, of itself, be regarded as binding on the department.

The Department for Levelling Up, Housing and Communities (“DLUHC”) will process your personal data in accordance with the law and in the majority of circumstances this will mean that your personal data will not be disclosed to third parties.

The collection of your personal data is lawful under article 6(1)(c) of the UK General Data Protection Regulation as it is necessary for compliance with a legal obligation to which DLUHC is subject. The relevant legal obligation is the obligation in s197(4) Housing and Regeneration Act 2008 for the Secretary of State to consult certain persons prior to giving a direction under that section of that Act.

Where necessary for the purposes of this consultation, our lawful basis for the processing of any special category personal data or criminal offence data (terms explained under ‘Sensitive Types of Data’) which you submit in response to this consultation is as follows. The relevant lawful basis for the processing of special category personal data is Article 9(2)(g) UK GDPR (‘substantial public interest’), and schedule 1 paragraph 6 of the Data Protection Act 2018 (‘statutory etc and government purposes’). The relevant lawful basis in relation to personal data relating to criminal convictions and offences data is likewise provided by schedule 1 paragraph 6 of the Data Protection Act 2018.

4. With whom we will be sharing your personal data

DLUHC may appoint a ‘data processor’, acting on behalf of the department and under our instruction, to help analyse the responses to this consultation. Where we do we will ensure that the processing of your personal data remains in strict accordance with the requirements of the data protection legislation.

5. For how long we will keep your personal data, or criteria used to determine the retention period

Your personal data will be held for two years from the closure of the consultation unless we identify that its continued retention is unnecessary before that point.

6. Your rights, e.g. access, rectification, restriction

The data we are collecting is your personal data, and you have considerable say over what happens to it. You have the right:

a. to see what data we have about you and ask to access it

b. to ask us to stop using your data, but keep it on record

c. to ask to have your data corrected if it is incorrect or incomplete

d. to lodge a complaint with the independent Information Commissioner (ICO) if you think we are not handling your data fairly or in accordance with the law. You can contact the ICO online, or telephone (0303 123 1113).

Please contact us at the following address if you wish to exercise the rights listed above, except the right to lodge a complaint with the ICO: dataprotection@communities.gov.uk or

Knowledge and Information Access Team
Department for Levelling Up, Housing and Communities
Fry Building, 2 Marsham Street
London
SW1P 4DF

7. Your personal data will not be sent overseas

8. Your personal data will not be used for any automated decision making

9. Your personal data will be stored in a secure government IT system

We use a third-party system, Citizen Space, to collect consultation responses. In the first instance your personal data will be stored on their secure UK-based server. Your personal data will be transferred to our secure government IT system as soon as possible, and it will be stored there for 2 years before it is deleted unless we identify that its continued retention is unnecessary before that point.

Annex B: Revised Direction

The Direction on the Regulatory Standards relating to tenant involvement and mutual exchange [2023]

The Secretary of State, in exercise of the powers conferred by section 197(1) and (2)(c) and (d) of the Housing and Regeneration Act 2008 gives the following Direction.

In accordance with section 197(3) of the Housing and Regeneration Act 2008, in deciding whether to give this Direction the Secretary of State has, in particular, had regard to the Regulator’s fundamental objectives.

Before giving this Direction the Secretary of State consulted the bodies required by section 197(4) and (5) of the Housing and Regeneration Act 2008.

Citation, application and interpretation

1.—(1) This Direction may be cited as the Direction on the Regulatory Standards relating to tenant involvement and mutual exchange) [2023].

(2) This Direction comes into force on the day after the day on which it is made.

(3) This Direction applies to the Regulator of Social Housing.

(4) In this Direction—

“2008 Act” means the Housing and Regeneration Act 2008;

“match” means where a property (“P”) is identified which fulfils the property requirements entered and there is a reciprocal match for the tenant of P;

“mutual exchange” means, with the consent of their respective landlords, an agreement between two or more tenants of a registered provider to swap low cost rental accommodation, whether or not the tenants are tenants of the same registered provider;

“mutual exchange service” means a service which enables tenants who have registered an interest in arranging a mutual exchange to search for property with which to exchange;

“property details” include the property type (flat, bungalow, house, etc), address and number of bedrooms;

“Regulator” means the Regulator of Social Housing;

“Right to Manage” means rights pursuant to regulations made under section 27AB of the Housing Act 1985;

“Right to Transfer” means rights pursuant to regulations made under section 34A of the Housing Act 1985;

“set” in relation to a standard, includes revise, and cognate expressions are to be construed accordingly;

(5) Expressions which are used, but not defined, in this Direction have the same meaning as in the 2008 Act.

Mutual exchange

2.—(1) The Regulator must set a standard that applies to registered providers relating to methods of assisting relevant tenants to exchange tenancies.

(2) In this paragraph ( “relevant tenant” means, in relation to a registered provider, a tenant of low cost rental accommodation of that provider who is potentially eligible for mutual exchange (3) The Regulator must set the standard referred to in paragraph (1) with a view to achieving, so far as possible, that each registered provider—

(a) offers a mutual exchange service which allows relevant tenants , whether pursuant to a statutory right or a policy of the registered provider, to easily access details of all (or the greatest practicable number of) available matches without payment of a fee;

(b) publicises the availability of any mutual exchange service(s) it offers to its relevant tenants;

(c) provides support for accessing mutual exchange services to relevant tenants who might otherwise be unable to use them.

Tenant involvement

3.—(1) The Regulator must set a standard that applies to registered providers relating to the involvement by relevant tenants in the management by registered providers of their accommodation.

(2) In sub-paragraph (1), “relevant tenant” means a tenant of low cost rental accommodation (including accommodation which is also low cost home ownership accommodation).

(3) The Regulator must set the standard referred to in sub-paragraph (1) with a view to achieving, so far as possible, that each registered provider gives tenants a wide range of meaningful opportunities to influence and scrutinise landlord strategies, policies and services, including by —

(a) taking reasonable steps to assist tenants who wish to implement tenant-led activities;

(b) providing accessible support that meets the diverse needs of tenants so they can engage with the opportunities in paragraph 3;

(c) taking into account tenant views in decision-making.

(4) When setting the standard, the Regulator must have regard to the need for registered providers to support tenants to exercise their Right to Manage, Right to Transfer or otherwise exercise housing management functions, where appropriate.

Revocation

1. Paragraph 3 (mutual exchange) and paragraph 4 (tenant involvement and empowerment) of the Directions on Regulatory Standards made under section 197 of the 2008 Act on 1 March 2012 are revoked.

Name:

For and on behalf of the Secretary of State for Levelling Up, Housing and Communities

Date:

Annex C: The 2012 Directions on Regulatory Standards

The Secretary of State, in exercise of the powers conferred by section 197 of the Housing and Regeneration Act 2008 (“the 2008 Act”) makes the following Directions:

Citation, application and interpretation

1.—(1) These Directions may be cited as the Directions on Regulatory Standards and apply to registered providers from 1 April 2012.

(2) The Regulatory Standards set by the Regulator of Social Housing (“the Regulator”) pursuant to these Directions apply to low cost rental accommodation of registered providers but do not apply to—

(a) in relation to a registered local authority, accommodation not accounted for within the local housing authority’s Housing Revenue Account; and

(b) in relation to private registered providers, rental accommodation to which grant has been given on the basis that the accommodation is intermediate rent, or accommodation specified as exempt from the rent influencing regime in the Rent Influencing Regime Guidance.

(3) In these Directions—

“category 1 hazard” has the meaning given by or under section 2 of the Housing Act 2004,

“Decent Homes Guidance” means A Decent Home: Definition and guidance for implementation published by the Department for Communities and Local Government in June 2006 and any guidance issued by the Department or its successors, in relation to that document,

“Housing Revenue Account” means the account a local housing authority is required to keep by virtue of section 74 of the Local Government and Housing Act 1989,

“internet based” means a service which is accessed through the internet,

“let on Affordable Rent terms”, in relation to accommodation, means provided pursuant to a housing supply delivery agreement entered into between a registered provider and the Homes and Communities Agency under the Agency’s 2011-15 Affordable Housing Programme Framework,

a “match” occurs where a property is identified which fulfils the required property details entered and there is a reciprocal match for the tenant of that identified property,

“mutual exchange” means an agreement between tenants to swap homes, whether or not the tenants are tenants of the same registered provider,

“mutual exchange property” means a property the tenants of which have registered an interest in arranging a mutual exchange with a mutual exchange service,

“mutual exchange service” means a service which enables tenants who have registered an interest in arranging a mutual exchange to search for other mutual exchange properties,

“property” means any low cost rental accommodation of a registered provider

“property details” include the property type (flat, bungalow, house, etc), address and number of bedrooms,

“Rent Influencing Regime Guidance” means the Rent Influencing Regime Guidance published by the Housing Corporation in October 2001, the Rents guidance in the Explanatory Note to Decision Instrument 5 (Revision to the Tenancy Standard: Affordable Rent) published by the Regulator in April 2011 and any other guidance issued by the Housing Corporation, the Regulator or its successors, in relation to those documents,

“Right to Manage” means the exercise of the rights in relation to the management of premises provided for under sections 27 and 27AB of the Housing Act 1985,

“RPI” means the general index of retail prices (for all items) published by the Office for National Statistics or, if that index is not published for any month, any substituted index or index figures published by that Office,

“set” in relation to a standard, includes revise, and cognate expressions are construed accordingly,

“Social Rent Guidance” means the Guide to Social Rent Reforms published by the Department of Environment, Transport and the Regions in March 2001, the Written Ministerial Statement on Affordable Rent made on 9 December 2010 and any guidance issued by the Department or its successors, in relation to that document, and

“tenant” means a tenant of a registered provider of social housing.

(4) Expressions which are used, but not defined, in these Directions have the same meaning as in the 2008 Act.

(5) References in any document referred to by these Directions to—

(a) registered social landlords, or cognate expressions, are to be treated as references to private registered providers,

(b) the Housing Corporation are to be treated as references to the Regulator.

Tenure

2.—(1) The Regulator must set a standard relating to types of tenure and relating to the content of registered providers’ tenancy policies (“the Tenure Standard”).

(2) The Regulator must set the Tenure Standard with a view to achieving, so far as possible, that registered providers grant tenancies which are compatible with the purpose of the accommodation, the needs of individual households, the sustainability of the community, and the efficient use of their housing stock.

(3) The Regulator must also set the Tenure Standard with a view to achieving, so far as possible, that registered providers publish clear and accessible policies which outline their approach to tenancy management, including preventing unnecessary evictions and tackling tenancy fraud, and set out—

(a) the type of tenancies they will grant;

(b) where they grant tenancies for a fixed term, the length of those terms;

(c) the circumstances in which they will grant tenancies of a particular type;

(d) any exceptional circumstances in which they will grant fixed term tenancies for a term of less than five years in general needs housing following any probationary period.

(e) the circumstances in which they may or may not grant another tenancy on the expiry of the fixed term, in the same property or in a different property;

(f) the way in which a tenant or prospective tenant may appeal against or complain about the length of fixed term tenancy offered and the type of tenancy offered, and against a decision not to grant another tenancy on the expiry of the fixed term;

(g) their policy on taking into account the needs of those households who are vulnerable by reason of age, disability or illness, and households with children, including through the provision of tenancies which provide a reasonable degree of stability;

(h) the advice and assistance to tenants on finding alternative accommodation they will give in the event that they decide not to grant another tenancy; and

(i) their policy on granting discretionary succession rights, taking account of the needs of vulnerable household members.

(4) The Regulator must also set the Tenure Standard with a view to achieving, so far as possible, that—

(a) registered providers grant general needs tenants a periodic secure or assured (excluding assured shorthold) tenancy or a tenancy for a minimum fixed term of five years, or exceptionally a tenancy for a minimum term of no less than two years, in addition to any probationary tenancy period;

(b) before a fixed term tenancy ends, registered providers provide notice in writing to the tenant stating either that they propose to grant another tenancy on the expiry of the fixed term or do not propose to do so;

(c) where registered providers use probationary tenancies, these are for a maximum of 12 months, or a maximum of 18 months where reasons for extending the probationary period have been given and where the tenant has the opportunity to request a review;

(d) registered providers grant those who were social housing tenants on the day on which section 154 of the Localism Act 2011 comes into force, a tenancy with no less security where they choose to move to another social rented home (this requirement does not apply where tenants choose to move to accommodation let on Affordable Rent terms); and

(e) registered providers grant tenants who have been moved into alternative accommodation during any redevelopment or other works a tenancy with no less security of tenure on their return to settled accommodation.

Mutual exchange

3.— (1) The Regulator must set a standard relating to methods of assisting tenants to exchange tenancies, in particular the provision of access to an internet based mutual exchange service (“the Mutual Exchange Standard”).

(2) The Regulator must set the Mutual Exchange Standard with a view to achieving the following, so far as possible, that—

(a) registered providers subscribe to an internet based mutual exchange service which allows—

(i) a tenant to register an interest in arranging a mutual exchange through the mutual exchange service without payment of a fee;

(ii) the tenant to enter their current property details and the tenant’s requirements for the mutual exchange property they hope to obtain;

(iii) the tenant to be provided with the property details of those properties where a match occurs;

(b) registered providers ensure the provider of the internet based mutual exchange service to which they subscribe is a signatory to an agreement, such as Home Swap Direct, under which tenants can access matches across all (or the greatest practicable number of) internet based mutual exchange services;

(c) registered providers take reasonable steps to publicise the availability of any mutual exchange service(s) to which it subscribes to its tenants; and

(d) registered providers provide reasonable support to tenants who do not have access to the internet.

Tenant involvement and empowerment

4.—(1) The Regulator must set a standard relating to the involvement by tenants in the management by registered providers of accommodation (“the Tenant Involvement Standard”).

(2) The Regulator must set the Tenant Involvement Standard with a view to achieving the following, so far as possible, that—

(a) tenants are given a wide range of opportunities to influence and be involved in—

(i) the formulation of their landlord’s housing related policies and priorities,

(ii) the making of decisions about how housing related services are delivered, including the setting of service standards,

(iii) the scrutiny of their landlord’s performance and the making of recommendations to their landlord about how performance might be improved,

(iv) the management of their homes, where applicable, and

(v) the management of repair and maintenance services, such as commissioning and undertaking a range of repair tasks, as agreed with landlords, and the sharing in savings made,

(b) registered providers support their tenants to develop and implement the opportunities in sub-paragraph (2)(a), including by—

(i) supporting their tenants to exercise their Right to Manage or otherwise exercise housing management functions, where appropriate;

(ii) supporting the formation and activities of tenant panels or equivalent groups and responding in a constructive and timely manner to them; and

(iii) the provision of timely and relevant performance information to support effective scrutiny by tenants of their landlord’s performance in a form which registered providers seek to agree with their tenants; such provision must include the publication of an annual report which includes information on repair and maintenance budgets.

Rent

5.—(1) The Regulator must set a standard relating to rent (“the Rent Standard”)

(2) The Rent Standard is to apply to private registered providers only.

(3) The Rent Standard is to apply in relation to the setting of rents in the financial year beginning on 1 April 2012 and subsequent financial years.

(4) In setting the Rent Standard, the Regulator must have regard to the Social Rent Guidance.

(5) Subject to sub-paragraph (8), the Regulator must set the Rent Standard with a view to achieving the following, so far as possible—

(a) rents conform with pattern produced by the rents formula set out in the Rent Influencing Regime Guidance (“target rents”) with a 5% tolerance on individual rents (10% for supported housing and sheltered housing) (“rent flexibility level”) but subject to the maximum rent levels specified in that Guidance (“rent caps”),

(b) weekly rent for accommodation increases each year by an amount which is no more than—

RPI + 0.5% + £2,

until it reaches the upper limit of the rent flexibility level or the rent cap, whichever is lower,

(c) weekly rent for accommodation which has reached or is above the upper limit of the rent flexibility level increases each year by an amount which is no more than the increase to the target rents

(d) rent caps increase annually by—

RPI + 1%,

(e) target rents increase annually by—

RPI + 0.5%.

(6) Sub-paragraphs (4) and (5) do not apply to accommodation let on Affordable Rent terms.

(7) Subject to sub-paragraph (8), where accommodation is let on Affordable Rent terms the Regulator must set the Rent Standard with a view to achieving the following, so far as possible—

(a) rent for accommodation (inclusive of service charges) is set at a level which is no more than 80% of the estimated market rent for the accommodation (inclusive of service charges), based on a valuation in accordance with a method recognised by the Royal Institution of Chartered Surveyors,

(b) rent for accommodation increases each year by an amount which is no more than—

RPI + 0.5%,

(c) rent for accommodation is re-set, based on a new valuation, each time the accommodation is—

(i) let to a new tenant, or

(ii) re-let to the same tenant (but where a probationary tenancy comes to an end and the registered provider re-lets the accommodation to the same tenant the provider is not required to re-set the rent).

(8) Where the application of the Rent Standard would cause providers to be unable to meet other standards, particularly in respect of financial viability including the risk that a reduction in overall rental income causes them to risk failing to meeting existing commitments such as banking or lending covenants, then the Regulator may allow extensions to the period over which the requirements of the Rent Standard are met.

Quality of accommodation

6.—(1) The Regulator must set a standard relating to the quality of accommodation (“the Quality of Accommodation Standard”).

(2) In setting the Quality of Accommodation Standard, the Regulator must have regard to the Decent Homes Guidance.

(3) The Regulator must set the Quality of Accommodation Standard with a view to achieving the following, so far as possible, that—

(a) accommodation—

(i) contains no category 1 hazard,

(ii) is in a reasonable state of repair,

(iii) has reasonably modern facilities and services, and

(iv) includes facilities or services for the provision of a reasonable level of thermal comfort

(b) accommodation which is at the standard set out in the Decent Homes Guidance is maintained by the registered provider at that standard.

(4) Where, in relation to a registered provider, the application of the Quality of Accommodation Standard would not be reasonable the Regulator may agree a temporary period with the registered provider during which the requirements of the Quality of Accommodation Standard need not be fully met.

1. Under section 197 of the Housing and Regeneration Act 2008 (‘the 2008 Act’). ↩