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01/2016 Housing and Planning Bill update 21/01/2016

Key points


  • The completed its passage through the House of Commons on 12 January and has now passed to the House of Lords, where its Second reading has been scheduled for 26 January
  • Several amendments were made by the House of Commons to Part 4 of the Bill, which deals with social housing
  • Chapter 2 (Sale of Vacant High Value Council Housing) will now come into effect on Royal Assent
  • Any agreement between the Secretary of State and a London Borough to reduce a levy under Chapter 2 will be expected to provide for 2-for-1 replacement of council homes sold
  • New measures to deregulate housing associations have been added
  • Housing associations have been exempted from compulsory 'pay to stay'
  • Clauses dealing with the rent chargeable to tenants who fail to provide income information or whose circumstances change have been amended
  • A new Chapter 6 has been added requiring new tenancies issued by local authorities to be for a term of two to five years in most circumstances, and amending rights of succession.



Sale of Vacant High Value Council Housing


The Government pushed through two amendments to Chapter 2 of Part 4. One provides for this Chapter to come into force on Royal Assent, earlier than most other parts of the Act. This may enable a levy to be made for 2016/17, although there will need to be consultation on a draft determination before that can be done.


The second amendment responds to representations by Zac Goldsmith MP and amends Clause 72 of the Bill to make special provision for London. Clause 72 enables the Secretary of State to enter into an agreement with a local authority to reduce the payment due under a high value sale determination provided the reduction is used to provide or facilitate the provision of housing. The presumption is that this power will be used to provide replacement housing, although there is no reference in the clause as drafted to either one-for-one replacement or to the location of any replacement housing. Nor is there any requirement for either the Secretary of State or any local authority to enter into an agreement under this clause.


As amended, Clause 72 specifies that any agreement with a London Borough must require the local authority to ensure that sold dwellings are replaced by at least two affordable new homes. New affordable homes funded by the GLA may be deducted from this requirement, and the Secretary of State also has power by regulation to disapply the 2-for-1 requirement in specified local authority areas. For these purposes a new affordable home is widely defined as either a new dwelling "made available for people whose needs are not adequately served by the commercial housing market" or a starter home as defined in Part 1 of the Bill.


As with the original Clause 72, there is no requirement for either the Secretary of State or any London borough to enter into an agreement.


In debate, MPs representing high value areas outside London asked whether Ministers would agree to similar arrangements and received a sympathetic response. Powers to make such arrangements are made available in the Bill as it now stand



High Income Social Tenants: Mandatory Rents


The original proposal to impose the 'pay to stay' scheme on housing associations has now been abandoned. The Bill has, however, been amended to give housing associations the necessary powers to facilitate voluntary 'pay to stay' schemes, including access to HMRC data on similar terms to local authorities.


The Government has amended the Bill as it relates to local authorities to remove the requirement on authorities to charge the full market rent to any tenant who fails to provide income information, and replace it with a requirement to pay a "maximum" rent as specified in regulations.



Phasing out of tenancies for life


Clause 113 and Schedule 7 of the latest version of the Bill amend the Housing Act 1985 so that when local authorities offer a new tenancy it must be a flexible tenancy of at least two but no more than five years except in specified circumstances. The specified exceptions are where a tenant is transferred at the council's behest, and as specified in regulations. In debate, the Minister confirmed the exemption of forced transfers and stated his intention to give local authorities "the freedom and flexibility to apply that to voluntary moves as well".


Clause 114 and Schedule 8 amend the succession rights of existing and new secure tenants to remove the difference between tenancies granted before and since April 2012. Currently, tenancies granted before April 2012 include the right to one succession which applies automatically to spouses and civil partners, and to other family members if they have lived with the tenant for at least 12 months prior to his or her death. Tenancies since April 2012 provide a statutory right to succeed for spouses, civil partners and those living with the former tenant as spouse or civil partner, but not for other family members. However, local authorities may provide any additional succession rights they think appropriate. The new clause provides that the rules applying to tenancies since April 2012 will apply to all tenancies. 

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