Service Family Accommodation: Maintenance

Julian Lewis Excerpts

Monday 19th June 2023 Commons Chamber

[Dr Murrison]

I hope that the scale of the challenge and the financial commitment that Defence has made to improving accommodation are clear. They are certainly heartfelt as far as I am concerned, but for context, it is worth pointing out that we are also committed to keeping rents low. The hon. Member for North Shropshire may be interested to know that, on average, our service families in North Shropshire pay £323 a month for a three-bedroom property. I have checked and I found that private renters in the same area can expect to pay an average of £750 a month for the equivalent home.

Defence is responsible for 47,800 military homes across the country. Right now, 97% of all MOD family accommodation nationally meets or exceeds the Government’s decent homes standard, and the figure for occupied service family accommodation in North Shropshire is also 97%. By means of comparison, in Shropshire, 76% of all private rented homes and 79.5% of social housing meet the Government’s decent homes standard. I hope that the hon. Lady has raised that with her local authority.

I should say that the seven occupied properties in the hon. Lady’s constituency that are below the decent housing standard are structurally safe and sound and met the standard when occupants moved in, but have since fallen below. Remedial action on the door and window lintels at fault is expected this summer. I hope that she is reassured by that.

However, when we are dealing with housing, it is inevitable that things will go wrong, as we all know. When they do, the response needs to be first-class, but according to the last armed forces continuous attitude survey, which canvassed service personnel late last year—and was published earlier this month—only 19% of respondents were satisfied with the response that they got. That is not good enough.

[Sir Julian Lewis (New Forest East) (Con)]

My right hon. Friend is being characteristically frank about the problems, as well as the successes, of the policy. Can anything be done to the model of financing for the maintenance of service housing that would perhaps incorporate a financial incentive on the people who have the contracts, so that if they do not arrange for repairs quickly enough, they could conceivably feel it where it hurts, in their bank balance?

[Dr Murrison]

I am grateful to my right hon. Friend, who is absolutely right. The FDIS contract that was introduced early last year does just that. If he will forgive me, I may just come on to describe what that might mean, or has meant, in a few moments.

The day-to-day management and maintenance of service housing has, since early last year, been through FDIS, and it has been contracted out to three separate contractors: Amey in the central and northern regions; VIVO in the south-east and south-west; and Pinnacle, which runs the national service centre and co-ordinates activity.

Any contract transition is fraught with difficulty, and it certainly has been with FDIS. But there is a third issue that challenges delivery to our service families—namely, the underlying issue of poor original build quality, which flowed from decisions made in the 1950s and 1960s and was compounded by historical underinvestment. When combined with a resource-constrained “fix on fail” regime, the resulting effect has led to a maintenance logjam estimated to cost around £960 million.

These are explanations, not excuses. The new contracts introduced a number of improvements: clear customer satisfaction targets, for the first time in MOD housing history; more demanding target response times for most types of reactive maintenance; a higher standard of preparation of homes for families to move into; and financial consequences for contractors that fall short, and incentives to go beyond the minimum standards.

Currently, as a result of some of the poor performance already outlined this evening, the MOD’s contractual rights to withhold payments from suppliers are being exercised and deductions are being made, as appropriate. Withheld profits will be reinvested for the benefit of service families. In addition, a total of £1.14 million in compensation has been paid direct to service personnel by FDIS suppliers, at no cost to the Ministry of Defence, since the FDIS accommodation contracts went live on 1 April 2022.

We are taking further measures to address issues related to damp and mould. We have established a dedicated hotline to address specific concerns, and we have improved the initial triage process to prioritise cases. This is followed by an on-site visit to apply the initial treatment, assess the need for a follow-up and decide whether a professional survey is required. Since early 2022, homes are not being allocated where there is a known damp or mould issue.

Separately, tomorrow we will table a written ministerial statement titled “Defence Infrastructure Update,” which will update the House on the work being undertaken to reduce a backlog in expired gas and electrical safety certificates in MOD properties through an accelerated and targeted renewal process. I am not going to pre-empt that announcement, but suffice it to say that Ministers were made aware in May of an issue relating to a backlog of expired gas certificates that had accrued while families were occupying their properties. That has occurred for a variety of reasons, including residents being unavailable to allow access to their homes for inspections, and supply chain resource and contractor IT issues.

The backlog of electrical certificates is a consequence of changes in regulations in August 2020, which required certificates to be completed every five years instead of every 10. Needless to say, we have acted immediately. The Secretary of State and the Minister for Defence Procurement have spoken with FDIS contractors personally, stressing that we expect this backlog to be cleared in the next few weeks. The Defence Infrastructure Organisation has worked with its suppliers to improve communications to families, to ensure availability for inspections. The MOD’s contractors have also made progress in recruiting additional resource and improving their data management to reduce this unacceptable backlog.

The Government have required all contractors to submit rectification plans. There is no complacency, but those are now showing progress. Pinnacle’s national service centre is answering all calls in an average of 14 seconds, which is significantly better than its 90-second target. Amey and VIVO have brought waiting lists down significantly, with very big improvements in maintenance response times. At the end of last month, the maintenance backlog stood at about 5,000, which is down from a high of 21,100 in December 2022. The number of open complaints is down by about 70%, and most key performance indicators are now at acceptable levels or better across most regions.

We need the final few measures to be brought up to scratch and, crucially, for that performance to be sustained. That is easier said than done, but we are making headway. The Defence Infrastructure Organisation is working with VIVO and Amey to develop a programme of straightforward interventions to address damp and mould. Critically, we also have the means, through FDIS, to hold our contractors to account should they fail to meet their end of the bargain. If required, we can recoup money or refuse to pay it out. We have already used those levers robustly where we can and where it is appropriate to do so, and they have made a difference.

So I hope I have reassured the hon. Member for North Shropshire that we are on the case, and we will most certainly continue to hold our contractors’ feet to the fire. Our new accommodation strategy, published last October, sets out a clear ambition for where we want to be: a situation where all our people have access to good-quality accommodation, in line with modern living standards.

Question put and agreed to.