Responding to the Government’s reforms affecting housing

1. Responding to the Government’s reforms affecting housing Presentation to Hackney CEN event – 23rd October 2012 Deputy Mayor Cllr Karen Alcock, Fiona Darby and John Hall

2. Responding to the Government’s reforms affecting housing CONTENTS • Where we have come from locally • Key Government changes/reforms • Impacts of changes/reforms locally • LBH action already taken • LBH action planned or under consideration • Working together

3. Where we have come from (1) – fewer social rent relets boosted by new build

4. Where we have come from (2) – some key achievements • Severe* overcrowding on Housing Register down by over 70% since 2005 • Statutory homeless in temporary accommodation down by 50% between 2003/4 and 2009/10 * lacking two or more bedrooms

5. Key Govt changes/reforms (1) • 60%+ cut in national housing budget to 2015 • Affordable Renting (AR): primary supply vehicle • requires conversion of some social rented (SR) relets to AR • Limited grant for new SR homes – targeted at estate regeneration and supported housing

6. Key Govt changes/reforms (2) • Fixed term tenancies in SR and AR sector (power) • Fixed term of 5 years (norm, minimum) • Landlords must “have regard” to LA Tenancy Strategies • Limits/caps on LHA help with private rents • Overall benefit cap (April 2013) • Reduced HB help for working-age under-occupiers in SR sector (April 2013)

7. Key Govt changes/reforms (3) • Powers for LA’s to: • discharge homeless duty by using private tenancies • exclude from waiting list those groups deemed to be “adequately housed” • create separate transfer lists • Council housing finance reforms

8. Impacts of the Government’s reforms in Hackney • New build supply landscape • LHA changes in private rented sector • Benefits Cap • “Bedroom Tax” • Overall supply/demand implications

9. Changing supply landscape (1) –SR and AR new build trends

10. Changing supply landscape (2) – rent levels and tenancies • Rent levels for RPs’ new AR lettings as %age of local market rents in line with LBH position: 50% for 3 bed+, 60% for 2 bed and 70% for one bed • Majority of RP lettings (all for AR) likely to be on 5 year fixed term, with most likely to be renewed but changed household circumstances could mean, for example, transfer to a smaller (or bigger) property • SR tenants prior to 1st April 12 wishing to transfer will have protected rights to lifetime tenancy if transferring to a SR home (but not an AR home) • Many AR lettings to date available to LBH have gone to statutory homeless

11. LHA changes in PRS (1)

12. LHA changes in PRS (2) • 3,878 awarded transitional protection (55% families) – average shortfall £28.60pw • Average weekly shortfall on new claims in Sept 12 – shared (£51.03), one bed (£31.57) and three bed (£34.28) • 31% of new claims for 2 bed+ lettings in Sept 12 had insufficient bedrooms for h’hold size • No evidence of rent reductions yet

13. 1067 households in Hackney Takes effect from 15/04/2013 Loss in HB between £0.01 - £400+ pwk 50:50 in social/private rented sector tenancies 60 in TA, already homeless 30 large families will lose all their Housing Benefit apart from 0.50 per week Of all the tenants affected by the cap: 113 are receiving ESA 681 are receiving Income Support 159 are receiving Job Seekers Allowance 114 are on other income i.e. Incapacity Benefit Benefits Cap (£500/£350)

14. 4179 households in Hackney Takes effect from 1/04/2013 Social rented sector only Working age only (not pensioners) 3091 by 1 room will lose 14% of HB 1088 by 2 rooms will lose 25% of HB 2255 households Hackney Homes, rest are RP’s Under Occupancy (Bedroom Tax)

15. Overall supply/demand implications (1) • Potentially large “notional” shortfalls of family lettings available to LBH for priority cases • Pressure on one bed lettings, with “bedroom tax” movers likely to reduce capacity for other cases but releasing family relets

16. Overall supply/demand implications (2) • Already seeing: • rising statutory homeless applications • increased acceptances involving loss of private accommodation • increased overcrowding for new LHA claims • Risks of: • increased moves to lower quality homes and/or to cheaper areas in other boroughs • rising TA numbers, especially due to benefits cap • LBH budgetary pressures • Need for greater LBH prioritisation and well informed residents

17. Action already taken by LBH (1) • Interim Position statements issued to RPs • Affordability thresholds by bed-size (50% - 70% of market rents), subject to welfare benefit caps • Ceiling for max percentage of SR relets converted to AR • Tenancy Strategy • Lifetime tenancies for LA homes to continue • Want to see lifetime tenancies in RP lettings (general needs) available to LBH, including AR lettings

18. Action already taken by LBH (2) • Refresh of 2010-15 Housing Strategy just agreed – key priority areas include: • Redoubling efforts to make best use of existing stock, including 46,000 social rented homes • Maximising supply of genuinely affordable housing on secure tenancies • Protection of standards in private rented sector and developing clear understanding of its future role especially in meeting local housing needs

19. Action already taken by LBH (3) • Benefits and Housing Needs Service • Welfare Reform Working Group • Detailed analysis of the impact • Data sharing • Information sharing, briefings and training • Rent Shortfall Team

20. Our main responses moving forward • Best use of current housing stock • Supporting those affected by welfare reforms • Lettings policy review • Refresh of homelessness strategy • Exploring scope and feasibility of boosting social rented new build supply

21. Best use of current housing stock Options under consideration include: • Incentivising more under-occupation moves • Increased use of newly vacated flats on estates facing demolition to provide temporary accommodation • Smarter working to tackle housing fraud across social rented sector • Financial incentives to secure increased supply of private sector accommodation

22. Lettings policy review • Review started • Successions • Issues/options being considered by the Council include: - how we respond to households that intentionally overcrowd themselves - how we respond to those who apply as homeless - a residential qualification - how we respond to applicants deemed to be adequately housed - armed forces • What other boroughs are doing

23. Supporting those affected by welfare reforms • Exemptions • Assistance into work • Mutual exchanges • Incentives to move • Lodgers • Assistance to move • Discretionary housing payments

24. Refresh of Homelessness Strategy • To start in November • Steering Committee • Consultation

25. Scope to boost SR new build ? • Will depend on overall LBH priorities for capital spending, VFM and council-interest (eg under-occupiers) • Potential options to be investigated include: • use of public sector land • using our planning powers • use of LBH capital resources • use of institutional investment

26. Working together • Ensuring residents are well informed on options and choices available • Getting involved in the reviews of the lettings policy and homelessness strategy • Encouraging residents to participate in the consultation • Publicising the work being done • Case studies

27. Responding to the Government’s reforms affecting housing Thank you. Any questions ?