Government has invited organisations and individuals to give a view on where the social rent cap should be set, taking effect from next April. Their deadline is 12th October 2022.
SHAC has submitted a response, and is encouraging everyone to do the same. You do not need to be part of an organisation, but can reply as an individual tenant or resident.
The consultation is a survey of 12 questions, with the first seven asking for profile information rather than forming core questions on rent.
We have set out our responses below in case these are helpful to others wanting to respond. Our answers can be copied and pasted into the relevant boxes on the survey.
Consultation on Social Housing Rents
Question 8:
Do you agree that the maximum social housing rent increase from 1 April 2023 to 31 March 2024 should be subject to a specific ceiling in addition to the existing CPI+1% limit? To what extent would Registered Providers be likely to increase rents in that year if the government did not impose a specific ceiling?
None of the options were selected. Instead, the following was written in the comment box:
This is two questions in one. (1) The rent cap should be set at zero, and extended to service charges (except on the basis of proven increased costs), and to shared owner rents which are currently uncapped and subject to rocketing RPI inflation with a percentage on top. (2) As far as we are aware, all housing associations utilised the maximum headroom provided by the rent cap last year. Government cannot pretend ignorance of the fact that housing associations will hike rents as much as the law allows.
Question 9
Do you agree with imposing a ceiling of 5%, or are there alternative percentages that would be preferable, such as a 3% or 7% ceiling? Do you have any comments or evidence about the potential impact of different options, including of the 3%, 5% and 7% options as assessed in our Impact Assessment (Annex D)?
None of the options were selected. Instead, the following was written in the comment box:
We believe that rents, service charges, and shared ownership rents should be frozen.
Question 10
Do you agree that the ceiling should only apply to social housing rent increases from 1 April 2023 to 31 March 2024, or do you think it should apply for two years (i.e. up to 31 March 2025)?
Ticked ‘Yes’ then added in comments:
Only provided that they are frozen and extended to service charges (except on the basis of proven increases in costs), and shared ownership rents.
Question 11
Do you agree that the proposed ceiling should not apply to the maximum initial rent that may be charged when Social Rent and Affordable Rent properties are first let and subsequently re-let?
Ticked ‘No’ then added in comments:
Rent should be frozen across all tenancies and tenures.
Question 12
We are not proposing to make exceptions for particular categories of rented social housing. Do you think any such exceptions should apply and what are your arguments/evidence for this?
Ticked ‘No’ then added in the comments:
There should be no exceptions. Arrears were already rising by around 10% annually, even before the pandemic, and will only get worse. There are other options. For example, housing associations have collective reserves of £4billion. This could be used to subsidise rents, and the larger associations could help support smaller ones.
Also, every percentage point increase allowed by Govt. in housing association rents will cost government around £1bn in additional Housing Benefit / Universal Credit payments. There are therefore ways that monies could be re-allocated to where they are most needed, ie. supporting housing associations with tighter margins or individual households to maintain their tenancies.
Demanding a Rent and Service Charge Freeze
The Social Rent Cap is a government directive to housing associations and councils setting out how much they are allowed to raise social rents each year. Landlords do not need to raise rents to the maximum allowed, but almost all do.
In previous years, the cap has been based on inflation (using the September CPI figure), plus 1%. At the current rate of inflation, that would have resulted in social rent increases exceeding 10%. SHAC and other housing groups have successfully lobbied government to set a lower cap, but continue to press for a total rent freeze, service charges to be frozen except where there are proven cost increases, and an extension of the cap to shared ownership rents.
If you have any questions about the consultation, please email shac.action@gmail.com.
For more details on our Rents & Service Charge Campaign, please see our Pledge Page.
30 September 2022
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It’s high time that vested interest groups put people’s need ahead of their own interests. Why is there a moral deficit in people working in the regulatory industry? If they don’t want to serve the general public, please get out and let people with integrity replace these morally bankrupt individuals.
Well said. This in a nutshell is the case for public housing that is run by and for those who live in the homes. There needs to be a system of democratic accountability instead of a golden circle at the top where the boards and executives serve their own interests.