Social Housing (Regulation) 2023: What operators and managers need to know

11 minute read
23 October 2023

Six years after the Grenfell Tower tragedy, we now have the most significant law affecting social housing, which will have a huge impact on registered providers (RPs) and those responsible for the operation and management of social housing.

Since Grenfell, there has been tireless campaigning for tenants' rights, and the inadequacy of some social housing has rarely been out of the news. More issues that are recent have been the tragic death of toddler Aawab Ishak and the Housing Ombudsman's findings of severe maladministration against numerous operators.

The intention behind the Social Housing (Regulation) Act 2023 (the Act) is to drive significant change in landlord behaviour to focus on the needs of their tenants to facilitate proactive regulation of social housing and to hold landlords accountable for their performance.

What problem is the Act fixing?

In England, approximately four million households live in rented social housing, and 202,000 households live in shared ownership homes. The social housing sector offers more affordable accommodation than the private sector, helping some of the poorest people in society. The term 'social housing' is used widely, notwithstanding a huge variance in the scale of social landlords and the type and standard of accommodation.

Following Grenfell, the Government published the Social Housing Green Paper — a new deal for social housing in 2018. They also launched a Call for Evidence: Review of Social Housing Regulation. Serious concerns were raised about how some social tenants were being treated by their landlords in relation to safety, quality, and slow and poor responses to complaints, with tenants feeling that they were not listened to or treated with respect.

The Government's 2020 Charter for Social Housing Residents: Social Housing White Paper set out the Government's proposals to drive up service delivery to tenants by holding landlords to account for delivery against the consumer standards, to rebalance the tenant-landlord relationship and maintain robust economic regulation. The Social Housing White Paper also set out a number of policy changes, which will be delivered operationally through the Regulator of Social Housing within its existing powers.

High-profile campaigns by Shelter and Grenfell United (to highlight two of many) fought for everyone to be safe in their homes and for justice for those who died due to inadequate housing. Shelter describes the Act as the legacy of the 72 people, including 18 children, who died as a result of the Grenfell fire and the legacy of two-year-old Aawab Ishak whose death in December 2020 was linked to the extensive mould in his Rochdale home.

What are the key changes?

  1. Creation of a new social housing advisory panel: the panel will comprise a range of voices from across the sector, including tenants and landlords, which will enable the panel to inform the regulator on a wide range of issues connected to the regulation of social housing, including the power for the panel to proactively raise issues with the regulator. The panel will be able to influence (amongst others) changes to regulatory standards and codes of practice, key sector issues and risks and how the regulator engages with key stakeholders.
  2. Enhanced minimum standards for registration as a social housing provider: enabling the regulator to enhance the requirement to meet its regulatory standards (relating to financial, constitutional and management arrangements) on registration or make registration conditional so that a social housing provider has to meet all of its standards to be successfully registered. These may include evidencing satisfactory compliance with consumer standards in relation to maintenance of homes and adopting suitable procedures for handling tenant complaints.
  3. Appointment of a health and safety lead: RPs have a new duty to designate an individual (employed by the RP or another appropriate person, meaning that, save in the case of local authorities, it cannot be outsourced) to act as a lead on functions relating to the provider's compliance with health and safety obligations to tenants. Legal responsibility for ensuring compliance will remain with the RP.​

    The health and safety lead's functions are to monitor the RP's compliance with health and safety requirements, assess the risk of failure to comply, notify the RP's responsible body of any material risks to or failures of compliance and advise on steps to ensure the RP addresses these.

    The RP:
    1. is under a duty to ensure that the health and safety lead has the authority, capacity and resources to carry out their role;
    2. must notify the regulator of the contact details for the health and safety lead;
    3. must publish the health and safety lead's contact details so tenants know who it is and how to contact them.
  4. Minimum standards for social housing: the Act introduces new standards to regulate:
    1. the competence and conduct of individuals involved in the management of social housing;
    2. the provision of information and transparency to tenants and the regulator;
    3. a code of practice relating to consumer matters to give RPs a better idea of what is expected from them and tenants a better idea of what to expect from their landlords; and
    4. the reduction of energy demand for social housing properties. The Secretary of State is required to publish a strategy by 20 July 2024.
  5. Enforcement of standards: a key change which comes into effect by the Act is that the 'serious detriment test' is removed, which allows the RSH to intervene on the grounds of a breach, or potential breach, of consumer standards, whether or not there is actual or perceived serious harm to tenants.

    The key enforcement tools available to the regulator are:
    1. Transparency: the regulator can direct RPs to collect, process and publish information concerning their performance with compliance with standards. Failure to comply with this obligation may result in the regulator imposing an enforcement notice or levying a financial penalty.
    2. Surveys: of the condition of a property can now be arranged on reduced or no notice (where the regulator suspects an RP is failing to maintain), and the regulator can obtain a warrant to gain entry where reasonably required.
    3. Inspections: the regulator must implement and plan for regular consumer inspections of RPs and keep the plan under regular review. The frequency of the inspections may vary, and some RPs may be subject to ad hoc visits.
    4. Performance Improvement Plans (PIPs): PIPs will be used to allow the regulator to hold an RP to account in relation to how it will address an issue and will give tenants visibility of the actions their landlord is required to carry out and the timescales for compliance. Failure to comply with a PIP may result in the regulator imposing an enforcement notice, or levying a financial penalty or an award for compensation – i.e. to a tenant, or inviting a third party to carry out the RP's management functions.
    5. Emergency remedial action: emergency remedial action can be taken in relation to failures which cause an imminent, serious health and safety risk, for which the regulator can be remunerated from the RP.
  6. Dealing with social housing: the Act closes a loophole, which potentially would allow an RP to dispose of, or declassify, social housing stock without notifying or seeking consent from the regulator if the party from which it had leased the dwelling was one of its associates, subsidiaries or another RP. This provision has a retrospective effect and will apply to existing leases granted on or after 10 June 2022.
  7. Housing Ombudsman: the Housing Ombudsman will have greater power to issue a code of practice on complaint handling and can issue orders to prevent the recurrence of issues identified during an investigation.
  8. Electrical safety standards: the Secretary of State can now impose duties on landlord RPs, rather than just private landlords.

What are the next steps?

The Act introduces significant changes, but only some of these changes are in force and more detail is expected in the form of secondary legislation. However, there are some things RPs should be doing now to be prepared:

  1. Transparency with tenants: this new requirement is core to the Act and the approach going forward. Operators should consider what practical changes can be made to achieve this, whilst balancing any understandable concerns relating to data protection.
  2. Health and safety lead: Operators must designate an individual to lead on compliance in this area (the health and safety of tenants in social housing).
  3. Damp and mould and other hazards: It's fair to say there has been significant coverage of this issue already. Given the new timescales that will come in mandating resolution of hazards, landlords should be training staff and putting systems into place now.
  4. Consumer standards: Operators and managers should keep a close eye out for updates to the consultation on consumer standards. In particular, note that the 'serious detriment' test will be removed as a trigger for action by the regulator.
  5. Funding compliance: several new duties have express cost implications (as well as the implied cost implications of complying generally). For example, operators must carry out electrical safety checks and nominate a health and safety lead. Operators must identify how the costs of these new measures will be met.

If you have any questions about this article, please contact Jacqueline Knox, Şenay Nihat or Kimberley Miller.

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