A tenant’s refusal to pay a 60% increase in service charges has forced One Housing Group (OHG, now part of Riverside) to freeze its service charges for 2022/23 on her estate.
When Angela* opened a service charge leaflet from her landlord in February 2022, she was angered to find a demand for a payment increase of 60%.
The service charge hike did not correlate to a greater number of services or improvements to delivery. In fact, the landlord declined to offer any rationale for the increase.
Service Charge Challenge
Angela wrote to Richard Hill, OHG chief executive, to put the landlord on notice that she would not be paying the increase when it was applied in April 2022, and that she was being supported by SHAC in taking the action.
I have been forced to take this action because my service charge increase is too high, your proposed increase is over 60%, which is an outrageous increase for a social housing landlord.“
Angela demanded that OHG provide “all the requests for works, receipts, and invoices for all the work undertaken in relation to my property, which in your view supports the proposed 60%+ service charge increase”.
One Housing tenants and residents protest outside the landlord’s head office
She went on to highlight outstanding disrepairs in her home and on her estate. She also reiterated concerns that the doors to her block were not secure and allowed anyone to walk into their building. The security failings continue to pose a threat to resident safety, especially as the security cameras do not work.
Other OHG estates were likewise expected to pay increases in the region of 60%. OHG resident Leon* wrote
Please see attached our service charge actuals we’ve been sent this week alongside last year’s costs – some crazy unexplained increases as ever.”
In November, Angela received a text claiming that she was in rent arrears although she had never failed to pay her full rent including the original service charge. Angela emailed Richard Hill reminding him that she was on a partial service charge strike and thus not in rent arrears.
Bizarrely, OHG’s reply informed Angela that she was both in arrears and in credit, undermining any remaining confidence she had in the landlord’s competence. They did not however provide receipts or invoices to show that costs had in fact increased by the levels demanded.
After nine months of correspondence with Angela standing firm in her refusal to pay until evidence of cost increases were provided and disrepairs addressed, OHG capitulated. The letter from an OHG Incomes Manager stated:
The service charge increase which you were advised of early last year was reversed back to the original amount with no increase of 60%.”
While jubilant about the success, Angela says it raises more questions about the unaccountable nature of service charging by housing associations.
Why was my landlord even allowed to raise service charges by 60% when it didn’t have a shred of evidence to show that the costs had increased?
Angela adds that her landlord was unable to send a single invoice or receipt which could be compared to the previous year, nor justify their reasoning for such a steep increase for social housing tenants.
In December 2021, OHG became a subsidiary of Riverside, creating one of the UK’s largest housing associations with 75,000 homes. Jointly, they collect more than £88 million in service charges either directly from tenants and residents, or through the welfare benefits system (Regulator of Social Housing Global Accounts, Consolidated Group Data 2021).
Angela does not believe that she is alone in having unjustified demands for service charge increases, and wonders over the amount being collected by her landlord illegitimately. She notes that if she had been paying through Universal Credit, the increase would never have been scrutinised or challenged.
The list of charges against One Housing continues to grow
The length of time that it took for the challenge to be successful is also a disgrace, says Angela. The increase should have been reversed as soon as she wrote to them in March, not after nine months of prompting. She believes many others in her situation will just give in and make the payments as the landlord’s demands get more threatening.
Angela is not alone, as the experiences of SHAC members over the last two years has demonstrated. The problem of unregulated and uncontrolled service charging is becoming an epidemic, and SHAC is now systematically collecting evidence through an anonymous Service Charge Survey.
Campaign to End Service Charge Abuse
Complaints about excessive and inaccurate service charges also led to a partnership between SHAC and FindOthers to develop a unique online tool to request and chase service charge packs; part of a long term SHAC campaign to end service charge abuse by housing associations.
The platform removes a lot of drudgery from the process with pre-set letters to which users can add their contact details and landlord name. The service is pre-programmed with the contact email addresses of most housing associations.
Withholding payment is increasingly being used by housing association tenants and residents frustrated at being a source of ready cash for their landlords. Almost 400 tenants and residents have signed The Pledge to withhold rent and service charge increases from April 2023.
As Angela’s experience shows, it is a powerful way to resist unreasonable demands from housing associations when the cost-of-living crisis means every penny counts.
* Not their real names.
5 January 2023
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