Sarah Patrice, partner at Anthony Collins, gives a whistle-stop tour of the legal implications of the Social Housing Regulation Act (the SHRA) which aims to implement much of what was said in the Social Housing White Paper and is making some significant changes to the way social housing providers are regulated, intended to drive up standards and tackle poor performance.

Applies to Registered Providers in England.

Who does the Act affect?

The new changes affect larger registered providers (RPs) (with more than 1000 units of social housing) in a different way to those that fall below that threshold ie smaller Registered Provider co-ops, but there are changes afoot for all. It’s also an interesting time for local authorities (and their advisors), some of whom may not be aware of the extent to which they will be affected by the new regulation.

What are the implications of the Act?

One of the golden threads of the Act is that it is intended to create a much more tenant-focussed social housing sector, giving tenants a much stronger voice, which for housing co-ops may be a standard occurrence, but is not necessarily so across the sector. The Regulator of Social Housing (RSH) has introduced new Tenant Satisfaction Measures (or TSMs), requiring all RPs to collect and publish data from their tenants about how they are performing (and, as the name says, how their tenants perceive they are performing) and to report on this  annually to the RSH, which will publish this in the form of “league tables”.

Landlords will need to know in detail, the quality of their housing stock, and who lives in it (including any specific requirements they have for example because of age or ill health, or also protected characteristics). Physical inspections of all properties will be required, not just sampling, which some RPs may find challenging from a practical and cost point of view. This is also of note for those local authority landlords who need to ensure they have plans to undertake stock condition surveys for all of their homes. There will most likely be data protection and compliance considerations off the back of this, such as collecting personal information from tenants and keeping it up to date.

Additional areas of note

Without taking ultimate responsibility away from the Board, organisations must appoint a new health and safety lead  who has the skills and expertise to fulfil this role and give the required reassurance to the RSH, Board and tenants. Government directions to the Regulator are also expected on:

• • Decent Homes Standard 2 – a consultation is expected this autumn over what the future Decent Homes Standard for social housing in England is going to be.
  • Awaab’s Law – this includes the right for tenants to have repairs completed in specified periods.
  • Residents’ rights to access information – held by their social landlord (the FOIA equivalent), sharing information on executive pay and management costs.
  • Professionalisation of the sector – and related required qualifications and training for staff and managers, noting the potential impact this may have also for RPs and the sector generally.
  • The formation of the Tenant Advisory Panel – the Social Housing Quality Resident Panel – which is designed to be a “hotline to the Government”, to put the voice of tenants at the heart of regulation and drive up the quality of social housing.

New enforcement powers for the RSH

The RSH will be able to impose Performance Improvement Plans or ‘PIPs’ if RPs fail to meet any of the Regulatory Standards, or if tenants need protection, or if an RP has failed to comply with a voluntary undertaking (to improve its compliance with the Regulatory Standards).

If the RSH doesn’t accept the PIP or if the RP has failed to comply with the PIP notice, the RSH can take further enforcement action using its intervention powers. These were already extensive before the SHRA but now include:

• • issuing unlimited fines – the Act also removes the £5k cap on the level of fines that the RSH can impose on an RP for breach of its obligations;
  • undertaking short notice surveys on 48 hours’ notice (in contrast to the current 28-day notice period it is required to give);
  • carrying out (or appointing someone else to carry out) remedial works to a property which has not been properly maintained. If entry is refused, the RSH can apply for a warrant for access and it will be an offence to obstruct anyone with a warrant;
  • carrying out routine inspections of RPs with over 1000 homes without the (previously required) consent of the Secretary of State;
  • appointing corporate managers to an RP that has failed to comply with the regulatory standards or has mismanaged its affairs;
  • removing officers of an RP if it has reasonable grounds to believe that the affairs of the RP have been or are being mismanaged, or its tenants and assets require protection, or if an officer is obstructive during an investigation by the RSH; and
  • publishing their findings and the potential reputational damage that this may bring as they name and shame failing RPs on their website and on social media.

The RSH has recently launched a consultation on how it uses these powers.

It has always been the case that the RSH has much preferred to hear bad news from the horse’s mouth and expects RPs to self-refer breaches of the Regulatory Framework. This continues to be the case under the SHRA but of course with the removal of the “serious detriment” test lowering the bar for regulatory engagement on breaches of the Consumer Standards, the RSH is already seeing a significant increase in the volume of self-referrals it is receiving. This is a complicated area and an RP which fears it may be in breach of a Regulatory Standard should seek advice to help understand whether this requires a self-referral to be made and if so, how to go about this.

The Housing Ombudsman – new powers

The Housing Ombudsman also has new powers under the SHRA including the ability to issue its own guidance as to good practice. In certain circumstances where a complaint is made against an RP, the Ombudsman may order the RP to assess whether its policies and practices in relation to a matter to which the complaint relates are consistent with the guidance.

The Act codifies the Housing Ombudsman and Regulator’s relationship and their recently updated Memorandum of Understanding sets out their intention to meet and communicate regularly and to share information and collaborate more easily.

So, all in all, does this mean RPs could potentially find themselves in hot water with them both, more readily, as they share more?

Sarah Patrice is a Partner in Anthony Collins Solicitors and heads the Governance, Funding and Corporate department  which provides advice and support to social housing providers, charities and social purpose organisations nationally, and in Sarah’s case, bringing a particular tenant focus.