Housing Associations

Wednesday 12th June 2019 Westminster Hall

[Albert Owen in the Chair]

15:59

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

I beg to move,

That this House has considered the accountability and role of housing associations.

I am pleased to see you presiding, Mr Owen, and to see the Minister in his place. I am grateful for the opportunity to raise this important issue. I thank the National Housing Federation; Grenfell United; the Deputy Mayor of Tower Hamlets, Councillor Rachel Blake; the House of Commons Library; the Charity Commission; the Leasehold Knowledge Partnership; and Poplar Housing and Regeneration Community Association for their briefings ahead of the debate, as well as Jenny Symmons in my office for pulling them all together.

I do not believe that what I will say today is at all controversial, which might reassure the Minister. There are more than 1,400 providers of social housing in the UK, and roughly one sixth of our households live in a housing association or council property. There is clearly agreement that the status quo on oversight needs changing.

On Monday, the Minister and I attended an event at Speaker’s House to mark the second anniversary of the Grenfell fire. A speaker for the group, Ed Daffarn, made the point that the regulator had let them down. We all know that disastrous decisions were made in the refurbishment of Grenfell Tower that led to the tragedy, and Ed identified that a key issue was the lack of regulation.

In the wake of Grenfell, the Government’s Green Paper on social housing, released last year, promised to create “safe and decent” homes,

“empowering residents and ensuring their voices are heard so that landlords are held to account”

and

“improving and speeding up how complaints are resolved”.

Those commitments were very welcome; however, we are yet to see the fruits. One of the biggest areas that needs tackling in the sector is the lack of clear regulation and accountability for housing associations. Solving that problem would surely lead to the delivery of safer homes, empowered residents and an effective complaints procedure.

I often find it confusing what the exact roles of the social housing regulator and the ombudsman are. Where are the lines of responsibility? It is unclear what the demarcations are in the roles of the two bodies, which causes serious problems not only for residents who need to report concerns, but for me. Currently, the social housing regulator seems to oversee financial regulation and value for money, and in extreme cases consumer standards, but does not handle routine customer service oversight. That lands in the jurisdiction of the local government ombudsman.

However, residents can turn to the ombudsman only if their complaint is rejected by the housing association in the first instance. Even then, many residents do not know that they have that option. I have been informed that even if a resident does know that they can escalate their complaint to the local government ombudsman, it can take at least a year for their case to be dealt with due to the huge remit covered and the high volume of complaints.

There is also the issue that two ombudsmen cover housing. The local government ombudsman technically covers social housing, but the housing ombudsman supposedly covers all housing. That leads to confusion about which body to turn to, and sometimes residents turn to both, which is a waste of time and resources. Labour’s Green Paper, “Housing for the Many”, makes it clear that the way forward is to have a single housing ombudsman who takes responsibility for the regulation of all housing, and who completely covers customer service and complaints handling. That dedicated service could deal with complaints in a shorter timescale, and would cut out confusion and restore authority to residents.

[Tim Farron (Westmorland and Lonsdale) (LD)]

Does the hon. Gentleman share my concern that, owing to their status, neither housing associations nor private landlords are required to respond to freedom of information requests? Given that, tenants might therefore have no access to fire safety reports or other such important information?

[Jim Fitzpatrick]

I am grateful to the hon. Gentleman for his intervention, and I will come to that point later.

For residents, be they social renters, key workers, people with shared equity or leaseholders, accountability and transparency are key. For public sector home owners or renters, responsibility for their home maintenance is generally clear, but in the private sector it is not. A recent example of such confusion is the Barking fire on Sunday. There appears to be a complete lack of information on who owns the freehold. Responsibility for the failings therefore cannot be allocated. How are residents supposed to feel confident in their homes when no particular company or individual will take responsibility for their safety and welfare? A clear system of regulation for housing association homes would go some way to making residents feel comfortable and protected.

[Jon Cruddas (Dagenham and Rainham) (Lab)]

This is an important debate. We had similar issues in Tower Hamlets, across Barking and Dagenham and Havering, with Old Ford, which was Circle Housing, and a notorious case on the Orchard Village estate because of a lack of effective regulation across the sector. At the same time, a number of housing associations increasingly saw their role as being developers, rather than fulfilling their historical ethical role of delivering for working people. Does my hon. Friend agree that the lack of regulation plays into the changing role of housing associations across the sector?

[Jim Fitzpatrick]

My hon. Friend makes a very good point, and I will come on to the role of housing associations and the change in their ethos. That will reinforce the concern that he expresses.

I hear all the time from constituents who are having trouble getting complaints about their housing associations dealt with. Issues such as above-inflation rent increases, unjustified service charges, unreasonable refurbishment costs and problems with repairs seem to be rife. The lack of information about tendering arrangements has also been a source of frustration. Residents often find it unclear who they can go to with their complaints, and do not have confidence that they will be given a fair hearing.

Accountability questions are all too common. In my constituency, there are many housing associations, many of which are very good. Some are average and some are poor. One of the best, if not the best, is Poplar Housing and Regeneration Community Association, commonly and locally known as HARCA. HARCA is a much-valued organisation in Tower Hamlets, going beyond its brief in housing to create community hubs and therefore maintaining a strong social ethos. It is also exemplary in its accountability. Its board has always had a majority of members from the local community, and it has created a tenant advisory panel with the aim of strengthening relationships with tenants and landlords. It was also an early adopter of the National Housing Federation’s “Together with Tenants” plan, again prioritising building good relationships with tenants.

In a recent consultation regarding plans for the Teviot estate in my constituency, there was a turnout of 81% of residents, 87% of whom voted in support of the plan. That demonstrates the high level of approval for HARCA’s work. HARCA also runs a resident-to-resident survey, where residents are trained to call other residents to get their comments on issues such as recent repairs, providing unbiased feedback for Poplar HARCA and involving the residents in shaping their local services.

Those initiatives have proved successful for Poplar HARCA not only in operating an efficient not-for-profit business, but in achieving high levels of resident approval. Its most recent survey, conducted in May, found that 83% of tenants and 75% of leaseholders were satisfied with the service. Clearly, involving residents in decision making at every possible level and seeking feedback regularly works in favour of both residents and housing associations.

However, that level of provision for, and investment in, tenants sometimes seems to be the exception rather than the rule. Housing associations are no longer obliged to have residents on their board. I urge the Minister to consider bringing back that requirement, as another means of making associations directly accountable to residents, and ensuring that executive boards have a local perspective.

At the opposite end of the spectrum to Poplar HARCA is A2Dominion, notorious in the housing world for its, at best, neglect of or, at worst, disdain for residents. The Daily Mirror recently reported that residents in Clyde House in south London are scared to sleep in their homes due to unsafe conditions. Thick mould covering pipes, water leaking into flats, vermin across the building and an assessment declaring it a

“moderate to high fire risk”

all appear in a new development.

A2Dominion is supposed to have the exact same social purpose as Poplar HARCA. However, residents are being ignored in their justified complaints. The lack of clear accountability means that it can get away with not taking responsibility for the necessary repairs and upkeep, while still charging tenants extortionate service charges. Associations such as A2Dominion need clear regulation, and residents need to know who they can turn to when they are not being taken seriously.

As the Minister knows, I have spoken several times in this place about fire safety in high-rise flats—not as often as him, of course—and the dangerous, highly flammable cladding that is still in place in too many blocks. If we want to show that we have learned the lessons from Grenfell, we have to bring in stringent legal oversight, so that no further lives are lost due to its absence, in addition to shoddy, cost-cutting workmanship, poor maintenance, wrong materials and weak fire regulations.

Another point of consideration is bringing local government into a more formal role in oversight. Local authorities are well placed to understand the performance, or underperformance, of housing associations through the relationships between councillors and residents, and through public realm services.

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

The hon. Gentleman is making a good speech with many good points. On his earlier point about accountability in the context of having a more effective national ombudsman, given that we all, I hope, accept that social housing is a social good and, in many respects, a public service, the out-and-out free market approach that has been taken to its provision has not been effective and there is evidence of market failure. Does he believe that greater local oversight and giving local authorities a role in holding housing associations to account for how they treat their tenants are also important parts of improving the regulatory framework?

[Jim Fitzpatrick]

The hon. Gentleman makes a good point, which I am also trying to make. The Government’s proposals for a national regulator and beefed-up regulations are sound and welcomed across the sector—the House reinforced that last week during the Grenfell debate—but there is a gap that local authorities could easily fill. There could be local oversight through local authorities engaging with the housing associations that operate in their local authority area, as well as national scrutiny through the national regulator, so there would be a local and national partnership to hold housing associations to account. Some housing associations are getting so big that they are becoming far too remote from their residents.

On that point, local authorities have no official role in formal regulation. If councils were given a role locally, alongside a national social housing regulator that focused on customer service, associations could be held to account and complaints dealt with more directly. I would be grateful if the Minister commented on that possibility.

Another concern is the practice of under-the-table mergers between housing associations. Although the Government do not officially play a role in that, they have created an environment that has led to more mergers and takeovers of housing associations. Those have to happen sometimes, but as housing associations get bigger, whether through mergers or national expansion, their ability to be financially transparent and locally accountable reduces. That is a serious problem for residents who pay service charges, as it becomes less clear to them where their money goes. Bigger and more remote associations can also avoid being answerable to residents on other questions about repairs not being done, or not done to a high enough standard, or about costs going up or questionable rent increases.

My worry is that the bigger housing associations become, the more they become like money-driven businesses, rather than locally focused organisations with a social purpose, as my hon. Friend the Member for Dagenham and Rainham (Jon Cruddas) said. I am grateful for the commitments in the Government’s Green Paper, which was published last year, and for the matters raised by the Secretary of State in last week’s written ministerial statement, but we need progress to be made through regulation and legislation.

On a separate matter, I agree with Grenfell United, and the recent Labour party paper, that it is high time that the Freedom of Information Act 2000 covered housing associations, rather than just council properties, as mentioned by the hon. Member for Westmorland and Lonsdale (Tim Farron). Residents and the public should have the right to information about safety standards and the like, to ensure that conditions and costs are monitored.

The Green Paper and the written ministerial statement offer better protection, more transparency and real accountability for residents in social housing, and I would be grateful for any assurance from the Minister that those commitments will be met as soon as possible after the close of the consultation that was announced last week. We want to ensure that our social housing lives up to its purpose of providing comfortable homes that are considerately managed, and that residents feel empowered in decisions made about their homes.

As I said at the start of my speech, I do not believe this issue is controversial or rocket science. There is support across parties and across the housing sector for what the Government are proposing—more transparency in respect of housing regulation, policing and enforcement—through a more powerful regulator. We need a strong commitment from the Government that they will move with speed and efficiency. As we approach the two-year memorial to Grenfell, some recommendations in Dame Judith Hackitt’s report have been enacted, but the Grenfell public inquiry will likely not conclude or produce a report until 2021 or 2022.

As I think the Government recognise, they need to take action where and when they can to reassure the public that their safety and wellbeing are paramount. A new regulator would be an easy way to demonstrate that determination, as would the other ideas I have suggested. I look forward to the Minister’s response, and I would be grateful if he considered this speech my contribution to the Department’s consultation on the matter.

16:09

[The Minister for Housing (Kit Malthouse)]

It is a pleasure to appear under your wise gaze, Mr Owen. I congratulate the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) on securing this important debate. He has been a consistent and persistent voice on housing issues, particularly the safety and welfare of residents, not just in his constituency but nationally. I understand his concerns about the accountability and role of housing associations, and particularly about the situations that some of his constituents face. I acknowledge the continuing role that hon. Members across the House play, as I know from my own experience, in resolving issues raised by tenants with their housing associations and other types of landlords; they rightly spend significant amounts of time trying to resolve problems when something has gone wrong.

Everyone has the right to be and feel safe in their home, and to expect their complaints to be dealt with effectively. The Government have taken recent steps to make sure that that happens. As the hon. Gentleman mentioned, we published the social housing Green Paper last year. We engaged extensively with residents to inform and shape it. After its publication, I held roadshows across the country with hundreds of residents in social housing and listened to them to understand their experience at first hand.

The Green Paper contains proposals to rebalance the relationship between residents and landlords, setting out the level of service that residents should expect and clarifying how to hold landlords to account when they are not delivering. We heard that residents want redress quickly when things go wrong, and that they want processes to be clearer and simpler. The Green Paper asks how we can ensure clear and effective redress for residents, including a question about the future of the democratic filter, which can delay the complaints process. I confess that when I was first elected to the London Assembly in City Hall, it came as a surprise that people came to ask for permission to go forward, through the democratic filter, to the ombudsman, which injected a significant amount of delay. We are grateful for the input of residents, landlords and other stakeholders through the process. We are assessing the consultation responses and finalising our response to the Green Paper, and I hope that we will publish that response shortly.

Alongside the Green Paper, we launched a review of the regulation for social housing to make sure that regulation maintains standards for residents while ensuring that landlords remain well run and financially robust. We asked whether social housing regulation focuses on the right things and whether the regulator should be able to take action more swiftly where landlords are not fulfilling their responsibilities. We are analysing what we have heard and will publish the outcome of the review of regulation in due course.

Registered providers of social housing must comply with the outcome-based regulatory standards set by the independent regulator of social housing. It has three standards covering economic regulation and four standards covering consumer regulation. The regulator takes a proactive, risk-based approach to enforcing the economic standards for private registered providers. It monitors landlord performance against those standards and, for larger associations such as Clarion, carries out in-depth assessments and publishes ratings for financial viability and governance.

All local authority landlords and housing associations must comply with the regulator’s consumer standards, which seek to ensure that homes are safe and of good quality, and that landlords deliver the right services. The regulator may take action where a breach of those standards has caused, or may cause, serious harm to tenants. Again, we asked questions in the Green Paper about whether that is the right threshold for intervention by the regulator.

Providers have principal responsibility for effectively identifying and resolving problems, and they are accountable for complaints about their service. The first step for residents with a complaint is to report the problem to their landlord. The regulator expects registered providers to have a complaints process that deals with issues promptly, politely and fairly. The onus is on individual landlords, working with residents, to set their approach and timescales for handling complaints. I stress that if any hon. Member, acting on a constituent’s behalf, is unhappy with a registered provider’s response once their internal complaints process has been exhausted, they may take the matter further.

Social housing residents can also approach the housing ombudsman service at any time to seek advice, but for a complaint to be formally referred, it must pass through the democratic filter. Should the ombudsman determine that a complaint falls within its jurisdiction, it will investigate the complaint to determine whether there has been maladministration by the landlord. As I am sure the hon. Gentleman knows, the ombudsman can then issue a determination letter, which may include orders and recommendations to resolve the dispute. The landlord is expected to follow any orders within a specific timeframe.

All housing associations must be a member of the housing ombudsman service—a free, independent and impartial complaints resolution service. It is primarily the role of the housing ombudsman to investigate individual complaints from tenants. For example, it can consider complaints about how a landlord has responded to reports of a problem. The regulator meets and communicates regularly with the housing ombudsman, in line with the memorandum of understanding that has been agreed between the two organisations. This includes sharing data on providers, such as evidence of potential systemic issues with registered providers, and on other issues. The regulator will intervene should it find that a landlord’s failure to meet a standard has caused, or may cause, serious harm to tenants, and it is for the regulator to decide on the appropriate level of action to take.

The hon. Gentleman raised an interesting point on the plethora of ombudspersons. It is certainly the case that we will add to that number—as he will know, we have already pledged to introduce a new homes ombudsman. He raises an interesting question on whether there should be a general aspiration to agglomerate these ombudsmen into a single housing ombudsman, which is something that the Department has been thinking about. However, there is an argument about specialism and responsiveness in a particular area that needs to be addressed before we move to that stage.

[Dr Poulter]

My hon. Friend mentioned this earlier. From a tenant’s perspective, one of the main challenges is the issue of serious harm and how it is defined. The threshold for serious harm often relates to something that might cause a danger to life or safety. If we are talking about having civilised housing conditions that are free from damp and fit for human habitation, we need to have a lower threshold. I hope that is something that the Government will look at very seriously in the Green Paper and their further work in this area.

[Kit Malthouse]

My hon. Friend is quite right. As I said earlier, the serious detriment test is one of the hurdles that need to be passed before there is intervention. We have asked in the Green Paper whether this is at the appropriate level. I would just point out that there is a difference between detriment and harm. In a situation where there is the threat of serious harm, local authorities have powers to step in and do the work that is required to deal with any immediate threat to safety or life. We have enhanced the housing health and safety rating system assessment tool, which local authorities can use when they look at a particular property in order to detect whether there is a particular harm that will allow them to intervene. That has been very pertinent to safety, particularly on the cladding issue that we have been dealing with over the past few weeks. We expanded the test to cover the envelope of a building, so that the local authority can make such an assessment.

[Jim Fitzpatrick]

Have local authorities actually availed themselves of that power in respect of defective cladding? It is quite difficult for local authorities to step in, is it not?

[Kit Malthouse]

It is, and the bar for that is very high, because there has to be an immediate threat to life. With cladding, one of the things that we have tried to ensure is that everybody is safe tonight. I have just commissioned and received reassurance through a review that that is still the case—everybody is still safe in buildings. If interim measures are in place in buildings that have not yet been remediated, one hopes the immediate threat is receding. Nevertheless, the power is there for local authorities to use. That is not just the case in a situation involving cladding; it is available to them in any situation.

I shall move, rather conveniently, on to safety. The hon. Gentleman and I have both spent time this week with Grenfell United, and we will spend more time with the group later in the week. Safety is uppermost in our mind. When things do go wrong, particularly on safety, it is of the utmost importance that such concerns are resolved as soon as is practicable. Registered providers must ensure that properties meet, and are maintained at, the decent homes standard. The regulator’s standards also require landlords to provide a repairs and maintenance service that responds to the needs of tenants and offers them choices. The objective is for landlords to ensure that repairs and improvements are right the first time. When they are not, tenants should complain and have the right to expect that something is done.

I should point out that if hon. Members believe they have constituents living in properties with serious hazards that present a risk to health and safety, they can report that to their local council, which can inspect and assess properties using the HHSRS. Should the local council become aware of a category 1 hazard, it can intervene.

[Albert Owen (in the Chair)]

I am sorry to intervene on the Minister, but we are expecting a vote very shortly. It might be helpful if he could finish.

[Kit Malthouse]

I will conclude very quickly.

The hon. Member for Poplar and Limehouse raised several other issues. The first was accountability for safety. As he will know, we accepted all of Dame Judith Hackitt’s recommendations. In the consultations that we published last week, however, we are seeking to pin individual responsibility for safety on a named individual throughout the process—from design, through construction and management—so that there is clear accountability.

The hon. Gentleman quite rightly raised the issue of the residents’ voice, which is something that I heard consistently on the roadshows. Again, this is a big part of both the Hackitt review and our social housing Green Paper, because a lot of residents feel that either they are excluded from the conversation in a committee, or it is just not happening at all. We already have a group of housing associations that stepped forward to look at best practice in this area, and they are working away at the moment.

The hon. Gentleman raised the size of housing associations. There is some truth to the view that the bigger any organisation gets, the more it has to have due regard for its responsiveness on the frontline. We hope to address in the Green Paper whether that is a structural issue about it being localised, or whether it loses focus on its primary product, which must primarily be the happiness and care of its tenants.

Finally, the hon. Gentleman raised freedom of information. There is a technical issue with freedom of information: the Office for National Statistics tends to classify organisations that are subject to freedom of information as being part of the Government, hence their debt moves on to the national balance sheet. Given that housing associations have something like £72 billion-worth of debt, that would make a fairly significant dent on our national accounts. Having said that, one of the issues that we will, I hope, address in the social housing Green Paper—when it eventually emerges—is transparency.

One of the key issues that Grenfell United has raised with me again and again is that the group has asked for information and has just not been given it. We think all those organisations—they are fundamentally not for profit, but serve the public and their tenants—have a duty to be as transparent as they can, subject to commercial sensitivities. That is something we hope to embed when the social housing Green Paper reforms come to light.

I thank hon. Members for their participation; it has been very useful. I will take into account the hon. Gentleman’s submission to our general consultation. As he knows, we have stood shoulder to shoulder in trying to reach the reforms we need to ensure that everybody is safe and well served in their homes.

Question put and agreed to.

16:27

Sitting suspended for a Division in the House.