Agenda item

(i)              Joint Report of the Assistant Chief Executive and Corporate Director of Regeneration and Economic Development.

(ii)             Presentation by the Housing Manager, Regeneration and Economic Development.

The Chairman introduced the Housing Manager, Regeneration and Economic Development, Marie Smith who was in attendance to give an update presentation as regards consultation on changes to the DKO Policy (for copy see file of minutes).

The Housing Manager reminded Members of the DKO choice based lettings policy for County Durham and that all social housing partners let 100% of their properties via DKO, and a number of private landlords also let via DKO, having been through the Private Landlord Accreditation Scheme.  It was added that the DKO Board noted that there was a need to re-brand and look at marketing properties based upon demand.  It was added that there was ongoing consultation in terms of a revised policy, with the last review having been carried out in 2013.  Members noted that the results of the consultation would be reported back to the Committee in September.

The Committee noted the reasons for the review were to look at customer needs; the impact of under-occupancy; and the impacts of current and upcoming Welfare Reform changes.  It was added that the private sector had improved since the last review of the policy, with many private landlords being able to offer tenants the keys to a property the same day and therefore there was a need to be able to meet the changing needs of customers.  The Housing Manager noted that the number of 2 bedroom properties remaining empty was increasing and the demand in terms of moving property was declining, and while there were some options in terms of Discretionary Housing Payments (DHP), there had been an impact upon demand and the upcoming cap on local housing allowance would likely have a further impact.

Councillors noted the main headline statistics for DKO, namely:

·       12,570 applications registered in 2015/16;

·       1000 to 1100 per month;

·       Slight decrease in people coming into the scheme;

·       Household income below £15,000 (80%);

·       Most popular age group registering is 16 to 34;

·       Main reason for registering is medical / welfare;

·       Let 4,622 properties in 2015/16.

The Housing Manager noted that the main changes proposed to the policy would be to change the current Bands A to E to Bands 1 to 4, in conjunction with a new medical framework and reassessment, with the comparison between the two being set out within the presentation and at Appendix 4 to the report.  Members noted that the main change was to Band 1 being urgent and high medical need, and a slight increase to Band 2. 

Members noted other proposals included removal of the quota system, also known as the “Manchester model”, which had been introduced when demand was high, to help provide great opportunity for those with a lower housing need, and with allocations to be made through Bands 1 to 4 and by date order within those.  Councillors were informed that it was proposed to change the current advertising cycle, to operate on a daily basis, albeit with an additional proposal in terms of transferring tenants having to have been in a property for at least one year. 

It was added that it was also proposed to make changes in relation to rent arrears; currently DKO uses a guideline of 8 weeks rent/mortgage arrears for disqualification from DKO.  It was proposed to lower the guideline for disqualification to nil (£0) rent arrears.  This however would not mean a zero tolerance approach as all applications would be assessed on their own merit and applicants would be allowed to qualify even with arrears, if they can display good reasons for accruing arrears.

The Housing Manager explained that there would be changes in terms of an affordability assessment, with access to larger homes being based on affordability ensuring that people could afford larger homes and issues such as shared tenancies would be looked at.  Members noted the timescales in respect of the consultation, ongoing until 12 August, with consultation with the relevant Boards and Committees.  Councillors noted there would be a report to Cabinet in October, with an aim to have the revised policy implemented from November 2016.

The Chairman thanked the Housing Manager and asked Members for their questions on the update report and presentation.

Councillor D Hall noted he felt that there was potential for a rent crisis in the near future and asked if, given the current economic situation, anyone would pass an affordability test.  The Housing Manager noted that while some tenants and potential tenants, post-2018 may not pass an affordability test, there was always the possibility of an individual getting a job at any point and becoming eligible.  It was added that there would be some access to DHP, however, there would need to be work undertaken by the Council in terms of looking at other models, such as shared tenancies, and to work with providers.  Councillor D Hall noted his concern was in terms of what options would be left available to those people who did not pass an affordability test, especially in respect of the potential for those people to fall prey to unscrupulous landlords.  The Housing Manager explained that this was an issue being looked at as part of the consultation.

Councillor J Maitland asked if the proposed 1 year limit in terms of transferring property would apply to tenants who would look to have a mutual exchange.  The Housing Manager noted a mutual exchange would still be possible, and also should a tenant’s housing need change then they would be eligible for transfer accordingly.

Mr T Batson noted the proposed changes seemed sensible and pragmatic, and asked what was referenced in Appendix 4 of the report where it stated “regeneration”.  The Housing Manager explained that this was to show where properties were being demolished in terms of regeneration projects; those tenants were given the higher priority in terms of allocation of a new property. 

Councillor J Armstrong noted the timescales in terms of the consultation, as set out at Appendix 5 to the report, and asked whether the draft policy was being presented back at the Boards for Derwentside Homes, Livin and North Star for example, in addition to the CDHG Boards.  The Housing Manager noted that there would be a meeting on 19 August to look at the feedback from all providers, and that issues would be discussed and that, should there be some differences of opinion, then those issues would need to be voted upon by the Board to go forward into the draft policy. 

The Strategic Manager for Housing, Lynn Hall added that while it was hoped for consensus on issues, there would be a result and a revised policy brought forward. 

Councillor P Stradling asked as regards the statistic of 80% of tenants being in favour of an affordability test, with the Housing Manager noting both Durham City Homes and Derwentside Homes tenants had been around 80% in favour of an affordability test, however, she did not have information to hand in terms of East Durham Homes tenants.

Councillor O Temple noted the issue of rent arrears, and highlighted that many tenants could be in “technical arrears”, for example if they pay rent weekly and are paid wages monthly, and therefore could there be scope in terms of the rent arrears limit being reduced from 8 weeks to possibly 2/3 weeks, allowing some discretion for those who were not actually in arrears, simply out of sync with their payments.  The Housing Manager noted that this was an issue that had been highlighted within the consultation and this would be looked at once all comments had been received to see what position to take in this regard.

Resolved:       

(i)              That the report and presentation be noted.

(ii)             That the comments made by the Economy and Enterprise Overview and Scrutiny Committee be fed into the ongoing consultation.

(iii)            That the Economy and Enterprise Overview and Scrutiny Committee receive a further report on the results of the consultation and detail of the draft policy at the meeting scheduled for 26 September 2016.