Crisis response to the Homelessness (Suitability of Accommodation) (England) Order 2012 consultation July 2012

Crisis response to the Homelessness (Suitability of Accommodation) (England) Order 2012 consultation July 2012 Introduction During the passage of the ...
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Crisis response to the Homelessness (Suitability of Accommodation) (England) Order 2012 consultation July 2012 Introduction During the passage of the Localism Act, Crisis strongly opposed changes which will allow local authorities to discharge the homelessness duty into the Private Rented Sector (PRS) whether or not the household consents. For statutorily homeless households, a social home and the stability and security that it offers will often be the most appropriate option. We oppose the removal of this choice. We know only too well the impact that homelessness can have on individuals and households. Homelessness is an isolating and destructive experience and homeless people are some of the most vulnerable and socially excluded in our society. Many statutorily homeless households are vulnerable and this is especially true for single people who have met the strict ‘priority need’ criteria meaning they have been deemed to be particularly vulnerable because, for example, of mental ill health or a disability. Discharge into the PRS for as little as 12 months could have a real impact on this vulnerable group and could lead to repeat homelessness unless there are clear regulations setting out the circumstances in which it is suitable, Crisis has extensive experience of working to make the private rented sector a sustainable home for single non statutory homeless and vulnerable people. Whilst it is not a panacea for the housing needs of all homeless and vulnerable people, we know that it can provide an effective housing solution, but it is crucial that appropriate support and safeguards are in place. A major concern we raised during the passage of the Act was around the safeguards which would operate to ensure that the accommodation homeless households are placed in is suitable. We supported amendments in the Lords to put regulations around security, a two stage discharge process, physical standards, management standards, affordability and location on the face of the bill. Although the amendments were not accepted, we welcomed Government assurances that they would bring forward an order on physical and management standards. More recently, we have seen reports of local councils making plans to place homeless households out of the borough, in some instances a great distance away. The most notable example was Newham, who hit headlines after seeking to place homeless families in Stoke on Trent1. However, other London councils such as Croydon, Westminster and Hammersmith and Fulham have taken similar steps. We are very concerned by these moves, which could see homeless people housed in completely different parts of the country many miles from family, friends, school, jobs and employment opportunities. This was an issue we raised during the passage of the Act and we are very pleased that Government has now noted these concerns and is consulting on how best to ensure location is covered by the Suitability Order. We favour the Government’s preferred option of bringing elements of the Homelessness Code of Guidance into legislation. It is important that the Government

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http://www.bbc.co.uk/news/uk-politics-17821018

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takes this approach and clearly sets out the factors in relation to location of accommodation that local authorities must adhere to. We are disappointed that the Government has not similarly recognised concerns around affordability. Cuts to Local Housing Allowance (LHA) will leave PRS accommodation less affordable, particularly in areas of the country with high housing demand and costs. We are concerned that local authorities may place homeless households in properties where the rent is not covered by Housing Benefit, and they will have to make up any shortfall from other sources of income or risk falling into rent arrears, with the possibility of repeat homelessness. Crisis has many years experience supporting people to access the PRS. Our work with access schemes has allowed us to build up a significant body of best practice and advice. We strongly recommend that local authorities are encouraged to look to this when developing systems for discharging homeless households into the PRS. They must also consider availability of PRS accommodation in their area and ensure that they do not impact on the work that PRS access schemes are undertaking with non statutory homeless households for whom the PRS is often the only accommodation option. Question 1: Do you agree that these five areas should be important in determining whether accommodation is to be regarded as not suitable? Question 2: Do you agree with the proposed requirements as set out in detail above? Please give details and reasons. Crisis strongly agrees that these five areas should be considered in determining whether or not accommodation is suitable for homeless households to be placed in. • Physical condition of the property We agree that the physical condition of the property is an important element in determining whether accommodation is regarded as suitable. Poor quality housing can cause stress, have a detrimental effect on people’s health and mental health and may make tenancy sustainment less likely. 44% of properties in the PRS do not come up to the decent homes standard, compared with only 8% in the social rented sector. These provisions are therefore vital in ensuring homeless households are not placed in homes with very poor physical conditions. People accessing the PRS at the lower end of the market are more likely to be living in poor quality accommodation. The cuts to Housing Benefit are likely to exacerbate this. Restrictions and changes to the way LHA is calculated mean that less accommodation will be available to those on benefits and there is a risk that accessible accommodation will be of a poorer quality. We are disappointed that the Order does not specify that a property will definitely not be regarded as suitable if it contains a Category 1 safety hazard. We would be extremely concerned if any household, let alone one that is homeless and vulnerable, were to be placed in a property which poses a serious risk to their health and safety. We therefore believe that the regulations should require all PRS properties used for the discharge of the homelessness duty to be at least free of a Category 1 safety hazard.

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One of the hazards that can attract a Category 1 rating is excessive damp and cold. We believe local authorities should be making a point of looking for this. Damp or cold properties will be more difficult and more expensive to heat. Fuel poverty is a real issue for lower income tenants living in the PRS, with some tenants facing high fuel bills that they may struggle to pay from their limited income or benefits. Living in a cold house carries health risks, particularly for vulnerable households. We also believe that the Order should be strengthened to require that an environmental health officer, or someone trained in using the HHSRS, inspects each property. This would ensure that all houses used to discharge the homelessness duty have been professionally inspected and reduce the risk of health hazards being missed or overlooked. We believe it is unlikely that a letting agent would be qualified to do this, as the consultation suggests. • Health and safety matters We agree that gas, electrical, fire and carbon monoxide safety should be considered when assessing whether a property is suitable. It is particularly important for vulnerable tenants that safety standards are put in place as they may be less able to ask their landlord to make improvements. Some may even fear retaliatory eviction if they do. With this in mind, we believe the Order should be strengthened to make it a requirement that smoke alarms and carbon monoxide detectors are fitted in any PRS property used to discharge the homelessness duty. • Licensing for Houses in Multiple Occupation Licensing for HMOs is an important part of the limited PRS regulation in England. It is therefore welcome that local authorities will not be able to discharge the homelessness duty using any HMO which requires a license but does not have one. The extension of the Shared Accommodation Rate (SAR) to all single people aged under 35 increases the number of statutorily homeless people who, if placed in the PRS, will be restricted to this rate. Single people who meet the criteria to be deemed in priority need are likely to be particularly vulnerable, with mental health problems or learning disabilities for example, and so sharing could be especially problematic. There is the potential for the stress of sharing to lead to health issues being exacerbated, and a risk of bullying if sharing with strangers. Homeless women who have experienced domestic or sexual violence are likely to find sharing with men who they do not know extremely difficult. DCLG should make clear that local authorities should use their discretion and discharge single homeless people into one bedroom social housing if sharing would be inappropriate for them. • Landlord behaviour We strongly support landlord behaviour being included in the Order. It is welcome that the fit and proper test will be applied to landlords whose properties are being used to discharge households into. In Scotland, all landlords must satisfy the fit and proper test before they rent out their property. There are some issues with the way this regulation is enforced, but it has gone some way towards improving standards. We agree that if local authorities discharge homeless households into the PRS then as a minimum the property should be let by a landlord who is a fit and proper person.

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However, we have some concerns that landlords will be asked to self certify any previous convictions. This could result in ‘rogue’ landlords concealing their convictions and could leave vulnerable tenants being placed in houses owned by unsuitable landlords. We would recommend that local authorities check their own records for details of past convictions and take all other reasonable steps to ensure that landlords are providing valid information. We also believe it is important that local authorities take an active role in enforcing the existing laws around harassment and illegal eviction. We do not believe that the draft Order goes far enough in laying out standards around landlord behaviour. We would like to see a requirement added in that homeless households can only be placed in a property owned by an accredited landlord. Landlord accreditation schemes vary in their requirements, but they should all offer greater protection than the fit and proper test outlined in the Order. • Elements of good management We agree that producing an Energy Performance Certificate should be a requirement. This is particularly important given the fuel poverty and health conditions that can be caused by a badly insulated house. We strongly support the requirement for a written tenancy agreement. It is right that this should be reviewed by the local authorities to ensure that it meets requirements and does not contain any unreasonable charges. We strongly recommend that local authorities make model tenancy agreements available to assist landlords in this. It is a legal requirement that the landlord places any deposit in a Tenancy Deposit Scheme. We therefore do not believe that accommodation should be regarded as suitable if this has not happened and recommend adapting the Order to this effect. Question 3: Are there any additional elements that should form part of the Order or any other comments you wish to make? The main additional element we believe should be included in the Order is the affordability of accommodation. Cuts to LHA will have a huge impact on the ability of local authorities to secure accommodation for homeless households in the PRS. The LHA caps will leave an ever decreasing pool of accommodation available for benefit recipients in London or other areas with high housing demand and climbing rents. The move to calculate LHA at the 30th rather than the 50th percentile of local market rates will reduce the number of properties available in all parts of the country. Perhaps most significant over time, though, is the move to uprate LHA by CPI, rather than with reference to local rents. Because rents tend to rise faster than CPI there is a risk that this will lead to large areas of the private rented sector becoming unaffordable to LHA claimants. As rents rise at different rates in different areas there is the real danger that the areas which will become unaffordable first will be those with higher growth, where employment opportunities are likely to be concentrated. Research by Shelter and the Chartered Institute of Housing warned that a third of local authorities could become very unaffordable – with less than 10% of properties available to benefit recipients - after ten years.2

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Shelter and CIH (2011) The Impact of Welfare reform Bill measures on affordability for low income private renting families

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If households are placed in accommodation where the rent is higher than their Housing Benefit entitlement they will be forced to make up the shortfall from other sources of income or risk falling into arrears. If they cannot keep up with their rent payments they may become homeless again, which will create further costs for the local authority as well as causing stress for the household. The Homelessness Code of Guidance states that accommodation should not be regarded as suitable if ‘after meeting the cost of the accommodation […] the applicant is left with a residual income which would be less than the level of incomebased jobseekers allowance’ they are entitled to.3 We believe that this principle should be enshrined in legislation. Crisis lobbied for affordability criteria from the Homelessness Code of Guidance to be placed on the face of the Act. The Government has taken on some of the other concerns we raised around suitability, in particular with regards to location, so we urge them to take account of this issue as well and include it in the Order. Additionally, if homeless households are placed in a property which they feel is unsuitable for them they will have the opportunity to appeal. However, if this appeal is successful, they will still be bound by the contract they have signed with the landlord and may not be able to leave the property immediately. We believe local authorities should be required to do all in their power to release tenants from their contract and to secure alternative accommodation in these instances. Some of the PRS properties used to discharge the homelessness duty will be unfurnished. The Sustain longitudinal research project being carried out by Crisis and Shelter highlighted the impact of adequate furnishings on homeless households’ experiences of the PRS, finding that ‘some people, who had no furniture as part of the tenancy, related it to the tenancy possibly breaking down in the future’.4 In cases where the tenant is struggling due to a lack of furnishings, the local authority should direct them towards Community Care Grants or help them to secure furniture and electrical goods in other ways. After the abolition of the Social Fund, local authorities should help homeless households to access whatever replacement scheme has been set up in that area. It will be very important for local authorities to look at the work being done by PRS access schemes in supporting homeless households into PRS accommodation. Some schemes have many years expertise helping very vulnerable households to access and sustain PRS tenancies. Local authorities should learn from the best practice developed by schemes over the years and seek to understand what works for local schemes working in the same rental market as well as considering how best to work with local schemes. One of the main barriers to accessing the PRS for low income households is the need for a deposit or payment of rent in advance. Access schemes often provide deposit bond guarantees which help to get around this issue. Local authorities must consider how to address this issue. Access schemes also frequently support their clients to apply for Crisis Loans for rent in advance. Local authorities should encourage homeless households to take this route until Crisis Loans are abolished in 2013, and after this point support them to apply for Budgeting Loans which the DWP intends to act as a replacement. 3 4

DCLG (2006) The Homelessness Code of Guidance Crisis and Shelter (2012) Sustain: a longitudinal study of housing wellbeing in the private rented sector

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It is good practice for access schemes to provide important support for vulnerable tenants. They should offer pre-tenancy assessment and training to ensure the tenant is prepared to live independently. They also provide ongoing support, tailored to the needs of the tenant, including forming links with other support services. This can help the tenant to sustain their tenancy, and reassures landlords that tenants are being well supported. Local authorities must provide similar support to ensure the tenancy is sustainable. We would be very concerned if local authorities discharging homeless households into the PRS affected the work of access schemes or the availability of PRS housing for them to use. We are already hearing some anecdotal examples of this happening. For households who are not statutorily homeless, the PRS is often their only housing option. We would urge local authorities to take account of demand for PRS housing in their local area and continue to place homeless households in social housing where possible to ensure that an adequate supply of PRS housing is still available for those who need it most. Question 4: Do you agree that the existing provisions on location and suitability should be strengthened so that homeless households are placed nearer to home wherever possible? Crisis strongly supports the strengthening of existing provisions on location and suitability. Changes and restrictions to the calculation of Housing Benefit will make it more difficult for local authorities in areas with higher housing costs to secure accommodation for homeless households within their boroughs. This risks them offering out of area placements, sometimes a great distance from where the homeless household has made their application. A number of London councils have already suggested that they will try to place households as far away as Stoke on Trent, Nottingham or Hull. This could cause great disruption for the households involved. They could be moved far away from their existing support networks or essential services. Areas with lower rents and more available housing are likely to be areas with less growth and fewer employment opportunities. Moving people away from jobs will make it more difficult for them to move into employment. There is also a risk that these lower cost areas will see a large influx of people placed there by local authorities and that local services may not be able to meet the increase in demand. During the course of the Localism Act we raised these issues at all stages and tabled amendments calling for the criteria around location to be strengthened. We therefore very much welcome that the Government is now addressing our concerns and is intending to include location criteria in the Order. Question 5: Do you agree that regulations should specify the factors in relation to location which authorities should take into account when considering the suitability of accommodation? Question 6: Do you agree that those factors listed above are the ones local authorities should take into account when considering location? We strongly agree that the specific factors local authorities should take into account when considering the suitability of accommodation should be listed in the Order. This will ensure that the regulations are clear and robust, and reduce scope for

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misinterpretation by local authorities. In general we agree with the factors laid out and believe they cover all the important issues local authorities should look at when deciding whether a property is suitable for the household in question. However, we are concerned that the requirement for local authorities simply to ‘have regard to’ these factors is too weak. It would still be possible for a council to consider all these factors but go on to place a homeless household a long way out of borough. We would recommend that a stronger provision is introduced preventing local authorities from placing homeless households any great distance away in the cases which would cause the most serious disruption, such as where the applicant would for example have to give up a job in order to move. We agree with the Government’s preferred approach. We do not believe that requiring local authorities to place households in ‘the nearest practicable district’ offers enough detail, nor is it necessarily practical for local authorities. There are good reasons for some households to be placed in different districts, such as fear of violence. However, we believe that the requirement to place households in ‘the nearest practicable district’ could be used in conjunction with the location criteria in order to protect households who are offered accommodation in a different area even after the local authority has had regard to the factors laid out in the Order.

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About Crisis Crisis is the national charity for single homeless people. We are dedicated to ending homelessness by delivering life-changing services and campaigning for change. Our innovative education, employment, housing and well-being services address individual needs and help people to transform their lives. As well as delivering services, we are determined campaigners, working to prevent people from becoming homeless and advocating solutions informed by research and our direct experience. Crisis has ambitious plans for the future and we are committed to help more people in more places across the UK. We know we won’t end homelessness overnight or on our own but we take a lead, collaborate with others and, together, make change happen. Crisis and the PRS Crisis’ involvement with the PRS dates back to 1997, when Crisis launched Crisis SmartMove, a rent deposit and advice scheme model which helped over 14,000 single homeless people into a new home. Following the closure of the National Rent Deposit Forum in 2006 Crisis took over delivery of a national advisory service for local authorities and others setting up and running schemes across the UK and since 2009 Crisis has been working in partnership with the DCLG to prevent homelessness amongst single people. Most recently Crisis was awarded £10 million in funding by the DCLG to manage the Crisis PRS Access Development Programme. Over three years, this programme will help 8,000 single homeless people into new homes. More information is available at http://www.privaterentedsector.org.uk/index.asp.

Company Number: 4024938 | Charity Numbers: England and Wales 1082947, Scotland SC040094 For further information, please contact: Sarah MacFadyen Policy and Parliamentary Officer Crisis 66 Commercial Street London E1 6LT Tel: 020 7426 5678 [email protected]

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