Good morning, everybody. Welcome to the Housing, Communities and Local Government Committee. I am Florence Eshalomi, the Chair of the Committee. Can Committee members please introduce themselves?

I am Maya Ellis, and I am the MP for Ribble Valley.

I am Andrew Cooper, the Member of Parliament for Mid Cheshire.

I am Sean Woodcock, the MP for Banbury.

I am Chris Curtis, the MP for Milton Keynes North.

I am Sarah Smith, the Member of Parliament for Hyndburn. I also declare an interest as a landlord.

I am Lee Dillon, the MP for Newbury. My wife works for a social housing provider.

I am Gagan Mohindra, the MP for South West Hertfordshire.

Can our guests please introduce themselves?

I am Fiona MacGregor, and I am chief executive of the Regulator of Social Housing.

I am Jonathan Walters, and I am the deputy chief exec at the Regulator of Social Housing.

Thank you for joining us today. We are looking at housing conditions in England, an issue that features in all our inboxes as parliamentarians, and in our work with our constituents and our respective councils. The RSH has been looking at the new programme of inspections for larger providers, with 1,000 homes or more, since April 2024. Can you give us an overview of what progress you have made on that so far?

Thank you for inviting us to speak today. So far, since April 2024, we have published 130 consumer judgments, on the back of inspections, and we are on track to be broadly halfway through the programme by the end of this financial year—that will be two years into a four-year programme, so we feel that we are on track so far. Our judgments cover a range of outcomes, which I think you will be familiar with. Our inspections of private registered providers cover both the economic standards and the consumer standards. For local authorities, it is just the consumer standards, which you might be familiar with. I will focus on the consumer standards for the moment, because that is the bit that has come into force since 1 April last year. We have published a range of judgments, reflecting the gradings, from C1 through to C4—C3 and C4 indicate either serious or very serious failings overall. In terms of some of the themes, we have found some very good progress on understanding stock condition, and providers finding ways to meaningfully engage with tenants—we can go into that in a bit more detail, if that is helpful. Where we are finding failings, there are some common themes. Even in C2, which means providers are broadly meeting the outcomes of the standards, there are things to be put right. The common themes, in most cases where it is not a C1 judgment, are failings on health and safety. Providers may be doing things like fire remediation surveys, but not necessarily following up quickly enough on the actions, or losing track of them. We are also finding failings with the repairs and maintenance service not meeting turnaround times and targets, and with tenant engagement and understanding the tenant base that providers are working with. So there are common themes that are coming up more regularly than other aspects of our standards. Where we do find failings, we work intensively with the provider. We are sitting alongside them, particularly if it is C3 or C4, to ensure, in the first instance, that they establish the root causes of the problem and properly understand them themselves. We are looking for them to put in place meaningful, deliverable and timely improvement plans, and we will monitor their progress as they go through those.

What is the timeframe for those improvement plans?

It can vary. It depends how extensive the failings are. The first thing we look for all providers to do, if there is a problem with health and safety, is to put that right and make sure the tenants are kept safe.

Is that immediate, within 24 hours or within seven days? If you walk into a block of flats that has children, and there are wires everywhere, that is hazardous.

We do not set them specific timescales. We want to know that they have a plan in place to deliver promptly, and that they can keep their tenants safe in the meantime. For example—you will probably be aware of this—it can take longer if there are fire remediation issues. What we want is things like waking watches, and providers ensuring that their tenants can be kept safe, while works are being organised and carried out.

If you are saying you do not set timescales, has any enforcement action been taken on providers?

If it is very serious—for example, relating to fire—the fire and rescue service would be involved. That is where we would expect providers to impose timescales and to be able to stipulate specific works, whereas we are looking for them to meet the outcome of the standards overall.

So no enforcement action.

We do not take enforcement action on specifics per se, but if we have a provider—this does not really happen—who is in any way unwilling to work with us and to put things right promptly, we would take enforcement action. We have a range of things we can do: we can put people on the board, and we could fine if we wanted to. But we do not find that that is the case; for the most part, providers are very willing to put things right, and they just need to make sure they have a proper plan in place to do so.

You have just outlined that there is no timeframe, so I am thinking that where you have some providers who have come into C4, which is the worst rating, there are still no timeframes for those failings, and there is no enforcement action.

There is no timeframe that we would set them, but if some of the C4s, for example, were to come back with an improvement plan that we thought was taking too long, we would not accept it. We work with them, without actually stipulating, “You must do it by x time.” We will say, “That is just too long. Sort it out.” We look at how they are prioritising their actions. It is also things like health and safety.

But if they were prioritising the actions, they would not have received the C4 rating in the first instance.

That is the point really. Through our inspections, we are bringing to light things that would otherwise have stayed covered up, if you like—they are not coming to light. By bringing them to light, we are ensuring that providers are actually prioritising actions and getting to the root cause of problems, and that they have a timely improvement plan. If it is not timely, we would not accept it, and we would ask them to do more.

Would you say that the RSH needs more powers, for providers to take these things seriously? Recognising the role that you have, it could be perceived as a light-touch inspection regime.

I would not call it light touch at all. I think that, through the inspections themselves, we have been very good at uncovering where there are issues. As I said, if we found that a provider was unwilling to make the improvements, there are other enforcement actions that we could take, so we do have powers. It is not light touch; we require providers to put in place a deliverable, sustainable, long-term action plan to achieve those improvements and to prioritise.

Do you set a timeframe for them to deliver that?

If they come up with a timeframe that we think is too long, we will not accept that improvement plan, and they will have to speed up.

If a provider received a C4 rating, I would have thought that your role, in terms of serious failings, would be to say, “This is unacceptable; it could potentially be a life-or-death issue. Instead of you telling us that you will resolve it within six months, we are asking you to resolve it within a week or a month.” Would that not be more suitable, in terms of making sure the inspection regime is working properly and having the intended consequence of getting providers to recognise the multiple failings that have led them to receive a C4 rating?

Of the four local authorities that have received the C4 rating, I think that in almost all cases you have organisations that have not got the data. They do not necessarily understand the quality of their stock. The first objective is to get them to understand the stock they hold, the condition it is in, and how it complies with the various health and safety requirements. The first thing is to get the resources into the council and to get the council to have the information that it needs. It then needs to put together an action plan about how it is going to address those findings. Often for councils—as you will be aware—it is about trying to find the resources internally to prioritise putting investment into housing, and that is often a difficult conversation within local authorities, but we have found that those four councils have taken it very seriously. Some of their problems are deep seated; for some of those organisations, these are properties that are going to take a long time to get back up to the decent homes standard. They will require extensive investment over a period of time, so this is not something that these authorities can put right straightaway; it is going to require a long timeframe. We want to make sure that we are sat alongside them, holding them to account. As Fiona said, if they are beginning not to deliver those outcomes—if they are falling behind—we will take further action and intervene, if necessary.

I fully appreciate the complexity of some of the issues that landlords are facing, but C4 includes a landlord’s failure to comply with remedial actions, meaning that they probably have not followed up issues when residents have raised them. It also includes “landlords showing a lack of understanding of the conditions of their tenants’ homes”. Again, have they been responding when tenants have raised things? There are “failures in repairs services”, and we hear many examples in which tenants have stayed in all day, waiting for repairs, but no one has turned up. There are also “a significant number” of failures to meet the decent homes standard, and we know that there are many problems with damp and mould in a number of old properties. To go back to my initial question, would you say that not having a timeframe—to be hard on providers that have received a C4, in particular—means that the inspection regime is light touch?

We do not think it is a light-touch regime. I think that if you spoke to our regulatees, they would not describe it as a light-touch regime. The inspection process is very intense. Clearly, we want to be respectful of professionals who are trying to do the best that they can. We are all conscious of what is happening in other regimes—Ofsted and elsewhere—but that does not mean you do not hold organisations to account. The standards we have set are reasonable standards that any good social landlord should be aspiring to deliver, and I think most are aspiring to them. I think that, for some of them, there is a definite strategic capacity question: can they actually deliver the outcome of those standards? That is particularly the case for local authorities, which are grappling with a whole range of other areas. Perhaps in some parts of the country, housing has not been the top priority for councils. Our inspection regime is certainly focusing the minds of officers and elected members in councils on the importance of their housing service. I think that that is pushing housing up the agenda in quite a lot of local authorities. Q130   Mr Dillon: I want to talk through the first C4 grading that you gave, which was to the London borough of Newham, because that would be helpful for the Committee. There were 9,000 overdue fire safety actions, 40% of its homes had not had electrical tests for over 11 years, and 60% lacked stock condition surveys. That was a collective piece that accumulated, and you have given them a C4. Clearly, those stock condition surveys cannot be done in 24 hours, especially at that volume of 60%. Could you talk us through, with that particular action plan, how the London borough of Newham expressed to you that they were going to address those issues and over what period of time?

The first thing we would be looking for, given the severity of some of the findings, is the overdue fire remediation actions—that is priority No. 1. There is a hierarchy of what actions are overdue, but we would expect them to put right the very high-risk actions as quickly as possible. It is the same with electrical safety. In the first instance, as Jonathan said, it is about understanding their stock and going out and doing those electrical safety inspections. There is a hierarchy of health and safety, and severity within that, that we would want them to be working through and, importantly, where we would want them to be demonstrating good progress to us.

But this is a live case.

Exactly.

That is what I am asking about. What was the action plan from the London borough of Newham that you agreed to as the regulator?

Exactly that point. The action plan would be to sort the fire risk actions and the follow-up actions, to get in place a process for carrying out electrical safety, and then rolling stock—

You are giving the same answer again. I understand it is a hierarchy, but I am asking for specifics. I assume that the fire action points would have been RAG rated again, so you have your most serious ones. Did you say to them that they have a week to get the red ones done, a month to get all the ambers done and six months to get the greens done?

I could not give you the detail month by month in that way, but what we have had back from them is an action plan that we agreed to in the first instance, and we are monitoring them against delivery. I could not tell you the exact timescales for each specific item, but we would be very happy to write to you on that.

That would be helpful.

I want to build on the question about accountability. You have talked a lot about setting timescales and what you expect them to do. If, in either this specific example, or just a general example, someone is given a timeline and they do not meet it, what do you do? Can you talk me through that, because that is the bit that I don’t quite understand? I am not hearing how you ultimately hold them to account. What is to prevent a private landlord or a council from continuing to push back? You can keep saying, “We are not happy with this,” but how are they held accountable?

It will differ between local authorities and private registered provider housing associations, because we have different powers. If we take the local authority example first, we are not grading them on their governance or their financial viability; we are just looking at their delivery of the customer standards. As Fiona described, we would want an action plan and a timescale, and we would want them to be delivering it. We would be checking in with them, and that can be weekly, daily or monthly, depending on the severity of the series of actions. When they are falling behind, we look at the actions that we need to take and whether we need to downgrade them further—if you are C3 and not delivering, do we need to go to C4? Then we need to start thinking about whether we open up any of the powers that we have with local authorities. Those are different from local authorities to housing associations, but we might look at whether we censure officers, fine people or, ultimately, launch a statutory inquiry. If we have had a further statutory inquiry, we can look at ordering the council to tender the management of its stock.

How often do you tend to use those powers?

We have not used those powers yet, because we have found that, with all the local authorities we have been working with, they do want to put this right. They are taking the actions that they think they need to. With local authorities, there is often the issue that their management teams have a lot of temporary staff. They find it hard to recruit and retain staff, so this is often about getting the right staffing and the right capacity.

Again, I appreciate all of that. You are talking about a lot of the challenges, which we understand, but ultimately it is about how you incentivise to make sure that this is done. What I am hearing from you is that, essentially, the grading itself is the incentive, but you are relying on that reputational value to matter enough to people to change things. I know you said that they do not necessarily have the information, but in the next few years, if we continue to see councils with C4s, presumably you will have to review whether that is really a deterrent.

That is exactly right. There will be questions for councils about their resources and capacity. But as a regulator, we have to say that they are either meeting those standards and are on a credible path to delivery or they are not. If they are not on a credible path to delivery and not showing that progress, we would have to use our other powers. It is obviously slightly different with housing associations; we are grading their governance and their financial viability. If we feel that they are not making progress at the speed we want, we may well downgrade their governance grade. We have done that with a couple of quite large housing associations recently, which have been made G3. If that is not making progress, we can make appointments to their board. Similarly, we can ultimately launch a statutory inquiry and use further powers. We have a slightly different suite of powers with housing associations.

How many people work in the RSH?

Just over 350.

And of those, how many are inspectors?

Nearly half of our staff do inspections.

What would a typical inspection be made up of, how long would it last and what are the skills of those inspectors?

The timescale for an inspection will partly depend on the scale and complexity of the organisation. We will typically give six months’ notice to anybody to say that we are coming out to do an inspection. If it is a private registered provider, we inspect both economic and consumer standards, while with local authorities it is just consumer. We require a wide range of documents from them to try and get assurance and evidence that they are running their services appropriately. We test the governance of that in terms of either council oversight or how a provider’s board gets assurance on the delivery of the outcomes of our standards. We then go on site to test that. Typically, we will spend a good couple of days on site. In the case of providers, during on-site visits we will talk to the board. In the case of local authorities, it will be to the council and officers. We will sit in on board meetings to test what the board itself is seeing and how it is holding the executive to account and getting assurance about standards. We will also talk to tenants, usually through the tenant scrutiny panel. We will do quite a lot of physical visiting of organisations to test in action and follow up on any information that we are getting through the papers that we have seen. We scope based on intelligence from the tenant satisfaction measures, anything that we see in terms of the ombudsman’s cases, and any information that is coming to us directly through complaints and what have you. That will typically be a couple of weeks of on site, testing papers and all of that. We then start to form our conclusions. If we have assurance gaps, we will go back and give the provider—whether a local authority or housing association—the opportunity to give us further information if they think that we have missed something. We will then reach our conclusion. We test that very rigorously in terms of consistency with all the other judgments. We are trying to make sure that we are calibrating our judgments appropriately based on evidence that we have seen in other places. In total, it can take anything between two and four months to get from an initial notification through to the publication of judgment, and we will be working alongside the provider the whole way through that time.

And in terms of the skills of the inspectors?

I mentioned that we now have 350 staff. We have nearly doubled in size since we became a stand-alone organisation.

Are you sure that you have enough staff?

Yes, we feel that we do. The variable is the amount of responsive work that we get, but we staffed up with a view to that building up, which it has. We have about 180 staff in our frontline engagement teams. We have a range of staff. Traditionally we have had staff with governance skills and good financial skills because of the financial viability function, but we have also been pretty successful in recruiting staff who come from a range of backgrounds, including people who have worked in housing associations and understand the housing management function, and who are tenant engagement specialists so we can test that aspect. We have a range of skills to cover the various areas that our standards cover.

You said you had 180 frontline staff; what do the other 170 do?

We have a small investigation and enforcement team, which is growing. That team will take the acute cases of providers that are C4, G3 or V3, which is very intensive management. We have that investigation and enforcement team; then a large business intelligence team that does all our analysis, data and publications; and a policy and strategy team that informs our own strategy and policy, develops our standards and works with MHCLG when it develops policy. We also have some of the typical back-office functions—finance and legal—that we need to run our organisation.

Finally from me, when it comes to tenant engagement, do you have any data about what percentage of tenants you actually engage with? You mentioned the tenant panel. Our concern as a Select Committee is making sure that tenant feedback is properly fed through to you as the regulator. The people on those panels are not always representative of that.

We have a range of routes in terms of tenant engagement. As I have said, when we go out and do inspections, we always talk to the tenant scrutiny panel. We have a database of tenants who we interact with directly, and we have really intensive engagement with those tenants. During the development of the consumer standards, the vast majority of the input that we had in developing the standards and on the consultation that we published around the standards was from tenants and tenant representative bodies. On the recent tenant satisfaction measures, more than half a million tenants across the country responded—that is one in eight tenants responding to those surveys. We have a very wide range of tenant engagement mechanisms.

I just want to clarify: did you mention that you give six months’ notice before inspections?

Six weeks.

Andrew and I will cover some questions around the decent homes standard. First, to what extent do you have an accurate picture of the prevalence and severity of poor conditions across social homes in England, including the number of social homes that fail the DHS?

With the PRP, housing association part of the sector, they are required to report to us annually on the level of non-decency they have within their stock. Clearly, we are also looking at that when we go out on inspections, and we are looking at the extent to which the board itself understands the level of decency. As we referred to earlier, one of the big changes we have driven in the sector over the last few years is a much better understanding of the quality of stock. One of the requirements in the new standards framework is that you have an up-to-date understanding of your stock condition, which effectively means the provider going round their stock at least once every five years and doing a 20% survey. They are actually doing physical surveys, whereas in the past it was common practice to do what was called “cloning”, where you would look at what one typical two-bed property looks like and then assume all your other two-bed properties were like that. We have stopped that practice. We are driving more physical inspections, which means that boards are getting a much better understanding of the quality of their stock. That is throwing up some of the issues that we are then finding. That is the same on the local authority side—they are not required to report to us on their level of decency; they do that directly to the Department, which shares that information with us. We think the sector is getting a better handle on it, which is now being reflected in the amount of money providers are spending on their repairs. That is going up significantly. This Committee held a previous inquiry into the financial position of the sector. One of the things that has been driving the weakening financial position is the significant additional spend that providers are now making into the quality of their stock. That is a good thing, but it has consequences.

You spoke at the beginning of your answer, Jonathan, about when you go out to do the inspections. How are you picking your stock list? Housing associations have gone through histories of mergers to make themselves bigger, so they are covering a much bigger geographical area. I imagine it is a challenge, when you are timetabling your inspection regime, to make sure that you are looking at stock in Devon as well as in Berkshire, for example.

For precisely that reason, we don’t think that us going and physically looking at individual properties will be representative of the condition of the stock of that landlord. We are really interested in how well the landlord understands its stock, so we are testing and looking at the results of the work that it has done through its stock condition surveys and how it understands the geographic spread. We have certainly found, with some of our judgments of the large housing associations, that they might be very good in certain parts of the country but quite poor in others. We are trying to understand that granular level of detail. Do the board understand, as you say, whether Devon is performing worse than Manchester? Making sure that the board and the management team are on to that is a key part of our work. We have also found with local authorities—again, because of the pressures they have been under—that they have perhaps not had the information you would have wanted them to have on the quality of their stock. That is coming out in a lot of our judgments. Of the 30-odd local authorities that have had C3, in a lot of those cases it is because they do not really understand the quality of their stock.

If you do not go out and visit the properties, how do you know that the stock condition survey data is accurate?

That is a really good question. One of the things we have been on a real drive about over the last few years is the quality of data and the quality of understanding, because that is fundamental to driving a good organisation. A good organisation will be challenging itself about exactly that question: how do we know that what we are being told is the right answer? There are a range of ways you might do that. You might use external consultants, you might use your internal audit service, or you might use third-party specialists who will validate that information for you. You want to have the right skills in the organisation and on the board to ask that. Again, we would expect our teams to be able to go out and ask those sensible questions. Sometimes, we turn up and we are given a picture that on paper looks really good, but you start poking the evidence and asking the difficult questions, and pretty quickly that begins to dissolve. We have certainly had situations where boards and perhaps councillors thought they knew the quality of their stock, but once we started asking questions, it turned out pretty quickly that they did not. That then gets reflected in our judgments.

I think tenants would be surprised to hear that you do not go into the properties though. You are enforcing those consumer standards, so you need to see them being demonstrated in practice rather than just on paper.

Absolutely. It is a really good question, and it is one we have debated long and hard internally. There are 4 million-odd social housing units, and us inspecting a very small number probably would not tell us that much, compared with understanding whether the landlord actually understands that. The landlord is the organisation that has to put those things right, so we want to make sure that the landlord is driving that culture themselves.

I note that when you appeared before our predecessor Committee in 2022, you mentioned that you did not think it was the regulator’s job, at least initially, to inspect buildings and properties.

It is a topic that we have discussed regularly. One of the dangers for us is that we end up stepping into the place where the board and the councillors should be. We are trying to make sure that they are being held accountable. We therefore think it is really important that they understand the quality of their stock, and that they can explain to their tenants the condition of the stock and when those things are going to be put right. Our job is to make sure that they are doing that, and where they are not doing it, we act.

The English Housing Survey estimated that 9% of social homes provided by housing associations failed to meet the decent homes standard. That is substantially different from the data that you have estimated, which is more like 1%. Can you explain to us where you think that difference has come about?

There are a range of reasons that drive that difference. The English Housing Survey is very much a point in time when they go into that property. What we have is the position at the year end. We find that an awful lot of associations will put things right as and when those issues are raised with them. We also find that there are a number of exemptions that the English Housing Survey does not take into account—for example, if a tenant has refused access to a property or refused for the work to be carried out. There are a number of exemptions that largely explain that difference. We also find that at the year end, associations will have gone round and made sure that as much of their stock is being dealt with as possible, and we see evidence of landlords going in and putting those things right.

To supplement that, in the most recent data return that we had from PRPs for ’24-25, we found that there were 41,000 actions taken to bring homes back to the decent homes standard. They had failed during the course of the year, and there were 41,000 interventions to put them right. What you are seeing is a rolling programme of corrections where non-decency is found. As Jonathan said, the English Housing Survey gives that point in time, so they are different methodologies. I think that is partly a reason for the different results.

I want to come back to something you just said. If I am a tenant and I refuse to have my kitchen replaced or something like that, and that would result in a failure to meet the decent homes standard, are you saying you would exclude that from your reporting of 1%—that you would count it as a decent home, even though it was a tenant refusal? The home is still not decent, surely?

Those are the rules set out by the Government. As you know, the Government are reviewing the decent homes standard at the moment, so that may change, but those are the reporting rules set out by the Government.

How do you ensure consistency in assessment between different providers? Do you do any work going out with the surveyors to make sure that they are following a common set of standards? What do you do?

We work closely with the main surveyors and we engage with RICS as the professional body. They, clearly, are the ones making the judgments about what that needs to look like. We are very interested in the quality of that work. It is something we look at when we do an inspection. We are engaging with the professional bodies and the landlords themselves. We do quite a lot of work checking our own judgments, as Fiona said earlier. When the teams have been out on site—when they have been looking at what the conditions are—they come back and we have a very extensive quality assurance process, where we are looking at the evidence we have found, correlating it, challenging it and making sure that we have not had any regulatory capture. We want to make sure that our staff are always independent of the organisations they are regulating—that they are holding those people to account. We have quite an extensive programme, as I say, of quality assurance to make sure that we are being consistent from one judgment to the next.

You will see examples in some of our judgments where we have pulled providers up because they might have been doing decent homes surveys, but they were not reporting specifically on some of the elements of the decent homes standard, such as the HHSRS—basically, health and safety. We are looking for assurance that they are covering all elements of the decent homes standard to try to make sure that there is consistency in reporting.

I understand your point about not going and spot-checking a home to make sure that it really is decent—that if it has been reported as decent, you do not check to see if it is not decent—but does your data insight team correlate between the data that you get on, for example, a repairs and maintenance backlog and a report that a home is decent? If you had four or five outstanding repairs on a particular property and it has been reported as a decent home, I would have thought that that data would be flagged up as maybe not as accurate as it should be. Do you do any of that kind of reconciliation as part of your inspection process?

As part of the inspection process, we will absolutely be looking at the quality of the data and the reporting back to the senior management and the board. That is exactly where we begin sometimes to unpick that. The board will say, “Yes, we have good-quality data,” but sometimes you find that when you start drilling down into that, and you go down the organisation and speak to people on the frontline, you see some of those inconsistencies and the lack of correlation. That sort of thing is often very germane to the judgments we make, where we find that, actually, people do not have a 360° view of everything that is going on in their properties.

I do not think we would characterise it like that in any way whatsoever. For example, whether it is local authorities or housing associations, you will see that a number of our judgments have uncovered—we have alluded to some of the local authorities that are C4—things that were not being noticed by the local authority in terms of their housing service, or had not had the focus that they needed. We have already started to revisit some of those providers who are on an improvement plan, and we are seeing steady improvements across local authorities and housing associations in terms of the understanding of their stock, the coverage of their stock condition surveys, the way they put things right when they go wrong in terms of health and safety, and improvements to the repairs and maintenance service. We can see those indicators improving, month on month and quarter on quarter. We are getting feedback, particularly from local authorities. At the moment, we are in the middle of carrying out a series of local authority webinars, because we engage closely with housing lead members who are either chief executives or directors of housing. The feedback we are getting consistently from those local authorities, even those at C2, is that our inspections have driven improvements in their services to tenants. We are also getting that feedback from tenants.

If there is information that anybody thinks we have missed as part of the inspection, they should contact us and we will obviously take that into account. We are looking at a rounded judgment, and services should be picking those things up and driving that improvement across the board, for all tenants in all properties. We are starting to see data that those improvements are happening. I think that there will always be cases where tenants are not being treated as they should be, or where repairs are not being carried out promptly enough. We are trying to drive that sustained, long-term improvement in all landlords, so that ceases to be the case.

How are judgments and notifications communicated to residents?

Following on from the last Select Committee inquiry in January, which I attended, we took up the point that you both raised. We now require providers to notify their tenants of the outcome of our judgment. If it is a provider who has a C2, a C3 or a C4, as part of our working alongside them to ensure that they are delivering the improvements to their service they need to deliver, we require them to keep their tenants notified of progress and how things are going. You kindly wrote to me afterwards, and we have changed. We no longer just make it an expectation; we require them to do so, and it is part of the feedback.

You have spoken quite a bit about the catch-up that the sector is almost having to do to meet current standards. I think you made an argument that it is making progress towards that and increasing spending on repairs. At the same time as it is trying to play catch-up with current standards over the next decade, we are going to raise standards quite a lot on energy efficiency with the revised decent homes standard. From a policy perspective, do you expect that the sector will be able to keep up with the pace of change of increasing standards?

We have much better insight into housing associations, because we collect their 30-year financial forecasts every year, so we have a sense of what the forward plan is looking like for housing associations. To give you an example, in the last five years associations spent £38.3 billion on repairs. In the next five years, they are forecasting to spend £54.4 billion on repairs and maintenance. You can see that the sector is beginning to step up its expectations. A lot of that is driven, exactly as you say, by decent homes 2, MEES, Awaab’s law and all those things.

There is no such thing as a free lunch, right? If they are increasing their spend on repairs and maintenance by about 50%, where is that money coming from? What is the trade-off there?

It is coming in terms of margin. Just to set alongside those two sets of figures, in the last five years the sector spent £65.9 billion on new homes and in the next five years it expects to spend £64.3 billion on new homes. It is trying to maintain the supply of new homes alongside significantly increasing the spend on existing stock. Where that is coming from is margin, frankly. They used to be able to have an operating margin of about 25% to 30%; they now have an operating margin of about 15%. They are now spending much more money on their existing stock. That means that they are now financially more exposed, and that has been reflected in both our own viability judgment and the credit rating agencies’ ratings of the financial position of housing associations. Housing associations are in a weaker position overall. That is not universal; it is very differentiated. Some organisations are much more exposed than others. But there is a real sense in which the sector has basically decided to spend a lot more money on homes and on existing stock, which is having a consequence.

Can you spell out what the consequence of that is?

The consequence is that they have far less financial robustness than they had previously, because they are not making the surpluses they were previously. It is all being invested in the existing stock. They are having to look very hard at their cost bases and their operating models, and where they can drive efficiencies. I think that has driven some of the mergers we have seen in the sector. We are seeing more and more organisations looking to be of a certain size and operate within a particular geography. We have seen a number of London-based organisations, for example, selling their stock outside of London to other organisations that operate in those areas, and retrenching back into London and saying, “That is our core area”.

You might not have data on this, but, if one of the consequences of driving up standards is larger associations, do you tend to find that larger associations on average provide better or worse quality accommodation?

I always say it is mixed, and that we have not yet seen a definite correlation between size and quality. We find poor performance both among small organisations and among larger ones.

Thinking about the finances more widely, if Government or the sector wanted to ensure we continued to increase standards while not leading to some of the consequences that you just described, what kind of policy interventions would we be looking at to do that?

The Government set out a comprehensive package in the comprehensive spending review earlier in the year. The figures we have at the moment were submitted to us before that information came in, so it will be interesting to see what the consequence is of the £39 billion for new homes, access to the building remediation fund and the rent certainty the Government have given. All those I think will help organisations manage some of the risks we have been talking about, but there is a limited number of levers the Government can pull. They can allow rents to rise higher, but that has consequences for tenants, for customers, and for the benefit bill. They can choose to put more grant in, but that has consequences for the fiscal position. There are a range of areas. I think what the sector is doing, as much as it can, is to look at how it works and operates, and whether it can find efficiencies within its own cost base.

As we go through this process over the next decade of increasing standards, what do you see as your role as a regulator in ensuring that it is happening, and that people are on track and meeting deadlines as and when the Government set them out?

That will vary between the various ways the Government have chosen to do this. For something like Awaab’s law, which has clearly had a big impact on standards, the Government are using the court system to drive that, and that is where tenants will go if they feel they are not getting what they want from that. For things like competency and conduct, and decent homes 2 when it arrives, that will be through our standards framework. The Government, having decided their policy, will direct us in terms of the standards we have to set. We will set that standard and then we will be inspecting to make sure that is being delivered, and taking action where we find it is not.

You said the difference is that previously these organisations were making a margin of 25% to 30%, and now they are down to 15%. Would you agree that a better approach over the last decade would have been to agree as a board of directors on, say, 20%, in order to be able to do that investment along the way, and to do the responsible and right thing as the governors of businesses and organisations that are there to provide a safe home for people to live in? Would you agree that there has been a real failure of that leadership and governance for us to be in the position that we are in today, with them now having to stretch themselves to make those commitments?

It is a good question, and one that we have been debating internally. In the 2010s, two things happened to the sector that were really material. One was that in 2010, grant rates were significantly reduced, so the sector had to find more money to be able to fund the additional that was made up. Grant rates used to be 60% to 70% of the cost of a new home. In 2010, that went down to 20% or 30%, so the sector had to make up that difference from its resources. It needed to make a return so it could invest that. Those margins were then being used to pay the interest costs on top of the additional debt that was needed to build the homes. Then in 2016 the sector went through a period of rent cuts, in which rents fell rather than rising. Both of those things have forced the sector to look very closely at its margins, and what it did in the 2010s was to prioritise building homes. Through both of those big changes, the sector carried on building 35,000 or 40,000 homes a year, year-on-year, despite that worsening position. I think what has happened now is that the sector has realised that it maybe got that balance wrong and is having to reinvest more in its existing stock. The post-Grenfell understanding of building remediation issues has created a bill that people did not know was there previously, but it is now a multibillion-pound bill that the sector is paying.

Looking forward over the next decade, how worried are you that pressures to increase the supply and try to increase the standards are going to come into conflict, and that we might see one over the other?

We talk all the time about trade-offs between investment in existing stock and investment in new homes. It could be mischaracterised at times as being a completely binary choice. I don’t think it is. I think providers are trying, in so far as they can, to do both things. There are some elements of work to existing stock where you are going through peaks at the moment—you might do the catch-up or complete your building safety remediation works over time—which would mean that that is not an ongoing investment. But there are new standards to come, as has been pointed out, so there may be a little bit of a balancing out in terms of investment in existing stock. We sometimes characterise investment in new homes as the float. That is discretionary. You have to keep your existing homes safe, you have to be of good quality and you have to provide good services to tenants. Everybody is aligned that new homes are a really high priority and that there are very high rates of homelessness and housing need in the country, but we would not expect any provider to stretch themselves to the point where that would put their business in jeopardy. We expect them to be making very well-informed investment decisions. We are seeing a little bit of that at the moment. The forecasts have gone down, because of the pressures on investment in existing stock. We expect that to rebalance out again when the benefits of the comprehensive spending review package, the additional grant, the rent settlement and the access to building safety remediation—we would expect that to come back up. One of the things we are looking at for PRPs, because we look at governance and viability, is that their long-term plans are keeping those things in balance. It is not a binary choice, but if it ever were a binary choice, you have to keep your tenants safe in their existing homes.

That is a real change from where we were in the 2010s.

Yes.

And that is because of the regulation. It really surprises me—shocks me, I think—that we have had these boards overseeing these organisations and not making the right decision. It has taken so much pressure and so much regulation to drive the point that if they have to choose a priority, the right call is to first make safe the homes that they provide.

One of the tactics that a landlord could use when it doesn’t meet standards is to dispose of stock, because it costs too much. As the regulator, do you have a view on stock disposal, particularly when there might only be limited social housing in a rural village and it would decrease the amount available in that place?

We do not have a power to prevent disposals. We lost our consent powers when the sector was brought on to the balance sheet, and we had to take moves for them to be able to come back off again.

Do you think you should have that power back?

I think it would drive different behaviours, but the ONS would immediately take a view on whether or not that puts the sector back on the balance sheet, and that is quite a big fiscal hit for the country. As Jonathan alluded to earlier, the majority of stock disposals are often intra-provider disposals—

I am not on about large-scale stock. I am on about single stock disposals.

Where providers are selling their stock because it does not meet standards, what we are looking for is how they are reinvesting the proceeds. It might economically make good sense to dispose of some units that do not meet standards and are very expensive to remediate. How are they reinvesting those proceeds? Often you can do a disposal of high value—

The problem is that you can do a disposal in Oxfordshire and rebuild in Devon, and it is that community that has lost out.

Absolutely.

One of the common threads that came up between Grenfell and the death of Awaab Ishak was assumptions made by housing professionals. We have heard clearly from campaigners, and I have heard in my in-tray, as I am sure my colleagues have, that tenants often feel stigmatised by their landlords. How good a job would you do at picking that up in the work that you do?

We look at a range of things. One of our consumer standards requires providers to treat their tenants with fairness and respect. We pick that up through interactions—any direct contact with us and the tenant scrutiny panels. We are looking for meaningful tenant engagement. That is one route that we see. We can pick it up through observing boards and seeing some of the documents that go to boards as well. As I said earlier, we have a specialist tenant engagement team. They are looking to get assurance about how tenants are treated. In the most recent set of tenant satisfaction measures, although there is dissatisfaction, for example with repairs, at times, and how complaints are handled, the landlord indicators of treating tenants with fairness and respect are relatively high. We are looking at a number of different routes to try to test that.

To go back to what my colleague said, it sounds like you are looking at a lot of paperwork rather than talking to tenants. Is that going to provide you with an accurate reflection of how tenants feel they are being treated, rather than how the landlord says they are treating them?

The TSMs are based on tenant responses and are usually conducted by third parties.

Who are normally appointed by the landlord.

Yes, but they are independent. TSMs are a good route. Talking to tenants when we do on-site visits is another very good route, as is some of the material that we get directly. There is a range of ways in which we would test this.

The competency and conduct standard is arriving soon from Government. That is about the quality of the staff working in organisations and the professional standards they hold. That will be a really important step forward in helping to address this.

So you think that will make a difference?

Yes.

Thank you very much, Jonathan and Fiona, for enlightening us about the work of the RSH. We might come back to you on some additional questions, but thank you for attending the panel this morning. Witnesses: Joe Roberts, Ashlea Birch, Ian Sanders and James Wilson.

Welcome to this morning’s second panel in our inquiry on housing conditions in England. Can I ask our guests to introduce themselves, please?

Good morning, everybody. My name is Joe Roberts. I work for Cornwall council as the head of regulatory services, covering services, building control, licensing compliance and housing quality.

Hi, my name is Ashlea Birch. My pronouns are she and her. I work for Manchester city council. I am the lead for environmental health, housing and trading standards.

My name is James Wilson. I am the head of environment and sustainability at Great Yarmouth borough council, covering a wide range of stuff including environmental health and private rented sector enforcement.

Good morning. My name is Ian Sanders. I am representing Hull city council. I am a principal environmental health officer, dealing with houses in multiple occupation and housing conditions.

Thank you very much, everyone, for coming to this morning’s session. There have been a lot of changes and new enforcements that housing providers, social landlords, private landlords and housing associations will have to comply with. A number of them were contained in the new Government’s manifesto. One of the key ones is the Renters’ Rights Act, which has received Royal Assent. How effective do you all feel respectively, working in different councils, in terms of improving the quality of homes across the private rented sector, and are you confident in your ability to enforce this new legislation?

It is a groundbreaking piece of legislation, really. If you are a tenant in the private rented sector who has been living in poor housing conditions for some time and are worried about your security of tenure in relation to raising complaints, it will give you hope that there is some way forward for you out of potentially quite a problematic and difficult situation. The Act itself covers various areas. I would focus in to say that the most groundbreaking element would be the landlord portal, which for the first time gives some councils that have not introduced licensing at any degree of scale in their areas an idea of where their private rented sector is. With that knowledge of the private rented sector, you are then empowered to try to understand it, work with it, and target your resources effectively to drive up standards, which is our ambition and has been for some time.

In terms of targeting resources, have you made any assessment of the cost of regulating that, and any additional cost that may come with enforcement?

It has been challenging, to be honest, because we did not know exactly when the Act was going to land. Our preparations are probably quite immature, but now that we know, we are pulling ourselves together to do so. I know some calculations have been made locally in the Jigsaw Homes Group, which represents the south-west, looking at this in relation to how many environmental health officers or suitably qualified professionals one may need per 1,000 PRS properties, for example. But I am not exactly sure what those figures are, so no, we do not have a definite figure in Cornwall for what we need. It is clear we need more resource to deliver the enforcement, or the new enforcement burdens that come with the Act. Also, we need more funding that is not piecemeal; we need more sustainable funding to be given to us so that we can plan a way forward towards increasing our delivery and helping those facing poor housing conditions.

James, the new regime comes into force from 1 May 2026. Would you say that you are ready?

To be honest with you, probably not, no. I would pick up on what Joe was saying: now is about trying to understand what the actual requirements are and what the resourcing will be for us as an organisation, as well as finding the staff. One thing that we have a significant issue with is that recruitment of qualified personnel from environmental health and the private rented sector is a struggle and has been for some time. We struggle in the eastern region a bit more. The North sea is far from our friend when it comes to recruitment. In that area, trying to get qualified people into those locations is a challenge for us. I suppose it is about understanding the need now in terms of the Act and the additional duties there—understanding where that sits within the council. Should it sit within just the team that I manage, or in terms of our housing sector, around some of the illegal eviction duties that will come our way? Quite a lot of additional work needs to be done around the resources that we need. We have a short timeframe to deliver that. Unfortunately, we as an organisation are about to launch selective licensing at the same time, so my team, which is very small, is balancing trying to get their head around the Renters’ Rights Act, and what it means for us as an organisation, as well as implementing a selective licensing scheme on already stretched resources. I think it will be a challenge. I think we will be ready, but it will be a challenge, definitely.

My answer is similar to both those answers. Sustained funding is the most important thing. We welcome the new burdens funding at phase 1 and we understand that there will be phase 2 of new burdens funding next year, but that is only single funding and we will be bringing in new staff. The qualified, competent staff do not exist; for this new Act we are creating an entire new workforce, probably across the country—I know that we will be doing so in Manchester. We already have quite a large team; it is going to have to grow considerably. We are looking into a larger selective licence scheme and additional licensing to complement the situation. It seems to me that the most sustained level of funding will be from the landlord portal. We understand that we will receive part of that fee on an annual basis. It would be really helpful to understand what that fee is going to be, and what proportion of that fee we are going to get, at the earliest opportunity and to understand when local authorities may receive that proportion, following the introduction of the database. That would enable us to join up our funding, including our new burdens funding, with the sustainable funding. Our CPNs are also useful, and we will get new powers there. There is new CPN guidance; we are currently reviewing and updating ours. We know that CPN receipts are useful, but you cannot sustain a service on them. Really, everyone is looking to the landlord portal to be our most sustainable source of funding, alongside our selective licensing and additional licensing, if we do that.

Ian, a lot has been spoken about tenants and their rights. Do you expect an increase in tenants raising concerns, as the Act comes into force next May? Across Hull, are you confident about dealing with that?

We expect there to be, sadly, a significant increase. I would like to go back and answer some of the earlier points as well, if I may, but on the question that you just raised, one of our concerns is whether we will see an uptick in the number of service requests that we receive about harassment and illegal eviction prior to the removal of section 21 evictions, come 1 May. We will obviously have to wait and see about that. There is interesting data from Scotland and other countries that have had a change in legislation. I understand that they saw up to a quadrupling of work come in following those changes. That is a concern. If I may go back to an earlier point, I want to add to my colleagues’ comments. I totally agree about the property database: we think that that will be very useful. I also agree about the sustainable funding. We have concerns about the new burdens funding and the short space of time that we will have to spend that money. Will that money be able to be rolled over? Can work be done with CIPFA to make sure that finance departments are aware of that and allow us to roll that over? Obviously, we think that we will need to create some new posts in relation to tenants’ rights, such as tenant relations officers. Our existing people in those posts do not have experience of taking enforcement action or of issuing CPNs. There will be an issue there around us either training them up or getting additional staff. To add to the points that my colleagues have made about staffing and recruitment, we are carrying two environmental health officer vacancies despite paying a market supplement. If I may use the seasonal flu analogy, it does not matter how many vaccines you have if you do not have enough doctors and nurses to inject that vaccine into the arms of those who need it the most. That is the situation that we have. You are giving us the tools but, sadly, we do not have the people in place to use them, and use them on the people who need them the most.

The Government have announced £18.2 million in new burdens funding for 2025-26, and that will be spread across all local authorities in England. They are due to announce additional funding from next year, when phase 1 begins. As a central pot, bearing in mind some of the issues that you have all outlined—maybe I know the answer already—do you feel that it will be enough, when you are looking at having to assess how many private rented properties you have and trying to take into account the increase in complaints?

I am going to go with no—we are looking at a quadrupling of work. My team for the private rented sector consists of three officers doing that work at the moment in Yarmouth.

Circa how many properties?

In the private rented sector, there are about 10,000, plus HMOs on top of that, as well as quite a lot of illegal HMOs that probably exist but we do not necessarily have the resources to find. I am looking at doubling that team at least, if not more, when you look at what we are talking about here. From previous experience of new burdens funding, I would say that it does not necessarily meet the requirements that we are looking for. One of the reasons we have gone down the selective licensing route is that security of funding and being able to resource some of the work. We know that it is going to be over the next five years, so I can resource that. As my colleagues said, finding out when new burdens funding is coming year on year is a real challenge for us, when we have to manage budgets with section 151 colleagues, and put staffing out there with funding that we do not yet know. I think it is really essential to have that sustainable funding and to understand it really early, particularly with the new landlord database and the funding and money that might come from that.

It is very welcome to start with, but I do not think it is enough. We need to take a step back and really plan and understand what it means, and try to get an understanding of the volume of complaints and demand that is going to change. I agree that post April there may be some demands in relation to harassment and illegal eviction, but that may also happen right now. Landlords are fully aware that it is going to happen, and they may make some poor, ill-informed choices, so we need to resource now—the sooner we get it, the better. It is not an area of work that has naturally been well resourced across local authorities for a long time. The expectation is quite a big one for local authorities to step into a space to protect people from harassment and illegal eviction. The work itself is slightly different; it is very complex and immediate. It is life-changing for people if they are removed from their own home, and it is very traumatic, but the authority needs to be there immediately to gather evidence. It is a slightly difficult dynamic to a normal housing inspection, where you go to a house, assess hazards, and draft up schedules and notices. It is all immediate, so you need to resource it well with highly skilled people for it to be effective. I think it is potentially a different type of challenge that is coming right now.

The landlord ombudsman is due to come in late 2026. Do you think the Government should try to bring that forward to deal with the complexity of disputes between tenants and landlords?

If it would help. I do not fully understand exactly how the ombudsman process is going to work and where it is going to support, but yes, if it can smooth out that relationship and stop sustained tenancies from breaking, I think bringing it forward would be an excellent idea. I also understand that there is potentially money associated with people signing up to the ombudsman service, and there is also potential for some of that money to move towards local authorities to support this work, which I would welcome. We have a challenging time ahead. We also have staffing challenges in Cornwall, as we struggle to attract staff. The peninsula that we are in is beautiful, but the house prices make it very expensive to live there, and people do not naturally make the move down there, or cannot afford to make the move, so I am sure we will also struggle to resource any additional post that we need.

I agree with a lot of what has been said there. I think one of the issues that we have with the crisis in the environmental health profession is the rapid reduction in our numbers. Sadly, this has been decades in the making; we are just not getting enough new people coming into the profession. Environmental health officers have a certain set of skills that is very valuable to employers. We are very good at looking at that holistic approach, and we are very good at problem solving, dealing with issues and partnership working. One of the issues you have is that those skills are desirable in the private market, and obviously people are attracted to where the money is greatest, and also to being promoted into the management structure. We are just not getting enough young people coming into the profession. I will give you the example of the apprenticeship. One of my officers has just undertaken the apprenticeship to become an environmental health officer. That has been a four-and-a-half-year degree and then there is another six to 12 months for that person to fulfil their portfolio of evidence for them to become an environmental health officer. That will have been a five-and-a-half-year investment to create one environmental health officer. One of the problems is that, unlike the NHS, we cannot recruit from around the world. There are only a small number of countries that have an equivalent environmental health officer: Australia, New Zealand and a few others. Even if you did somehow manage to attract some of those staff to come all the way over from the other side of the world, they will have been working in different climates, different housing conditions and with different legislation. They not going to hit the ground running. They are going to have to be trained up to do that. The thing about environmental health officers is that during covid-19 we were seen as essential workers. We are very good at dealing with crisis management. Following the tragedy at Grenfell, you will find that it is environmental health practitioners that are dealing with the cladding crisis. Following the invasion of Ukraine, you will find that it was environmental health practitioners that were going out there and assessing the accommodation that those refugees were going to live in. We are very good in a crisis, and we are very good at dealing with things when you need us. Unfortunately, we are a dwindling number and an ageing profession.

I am sure they will enjoy the weather in Hull if they came from Australia.

The Guardian recently reported that two thirds of councils in England had not prosecuted a single landlord in the past three years. Hearing some of what you have said so far, I think we are starting to get a bit of a picture as to why that might be, but I want to know what your own experiences of your own councils have been in using some of the powers that are available, and how effective they have been when you have sought those outcomes.

In terms of prosecutions, once the ability for us to serve civil penalty notices was introduced in the Planning Act 2016, we started serving civil penalty notices in 2017-18. We started using them rather than prosecution because they were quicker and more straightforward than taking a formal prosecution. We have served £1.7 million-worth of CPNs. I have the number somewhere. We have served a few hundred of them. They are effective, but they have their issues as well. Debt recovery is an issue with civil penalty notices. We have recovered, say, 45% of all the notices that we have served, and it takes years. If you look back to 2017-18, we have recovered most of it, but it has taken five or six years to do that. We do think they are a deterrent for landlords. We think they are important, and the fact that the offence amount is being raised in the new Act is good. We are going to continue to use them to contribute towards our enforcement work. To answer your question, we moved from prosecution to using civil penalty notices more.

In Cornwall, we have an enforcement policy. The enforcement policy you design should really drive this activity, but I would say that our measure of success is not necessarily prosecution, in response to the article that you read. In Cornwall, there is a need. If you have the criminal element operating in the sector and it is clear that you need to act, then clearly I would support it and we do. We have an enforcement policy where we move to using either civil penalty notices or prosecution. We would use prosecution if we think we need to move towards banning orders. I do not have the exact stats, but we have done about 15 CPNs and made five or six prosecutions in the last three or four years. The volume is not great, but it is drawn on when we need to do so. That is driven by an enforcement policy that helps and guides those operating on the ground as to when you move through this process towards either civil penalty or prosecution.

I have read that Guardian article and, with respect to the journalist, I think that is a flawed view of our services, quite frankly. If I may use an analogy, you would not base the performance of a GP on how many of his patients had a surgical procedure. GPs do an awful lot of work with regard to health education and medication. That is the same in local government: in the private housing and environmental health world, we do an awful lot of work on education, speaking to people and verbally or informally getting the works carried out. One of the issues here—it is something that very few people are talking about—is the education of landlords. At this moment, there is no national requirement for landlords to undertake training. When you finish this session and go for your lunch today in a restaurant or café, the people who will prepare your food will have a basic or advanced food hygiene certificate. They will have greater qualifications in their area of work than your average landlord. That is one of the problems we have. There needs to be some education. Before you can drive a car, you need to undertake a theory test. Why can’t we improve the education and information that is out there for landlords? Ultimately, some patients, sadly, are acute and do need some surgery, and so sometimes you do have to prosecute or do CPNs. Ultimately, the volume of work that we carry out or get carried out and completed through informal means, verbally and in writing, is phenomenal. The three-monthly reporting will hopefully show that.

To continue your analogy—I recognise that the councils in the room are taking some of this action—if you had a group of GPs who were not referring anybody for an operation, you would ask some questions about whether they were assessing the needs of their patients effectively. What barriers are preventing some councils—as I understand it, 23 have issued none at all—from issuing improvement notices and taking further action? James, do you want to come in? I know I have now given you two questions.

That is fine. Some of the barriers are the level of training and the number of people to do the work to get a prosecution together for some of these complex cases. Some of them are very straightforward, but that is probably a challenge for some of those individuals. Is there a priority in that council for that particular need? It may well be that the housing conditions in that area are not a priority for them. There could be a whole number of reasons why. On what we were talking about before, I agree that central Government have emphasised stepping away from putting pressure on the courts and instead using the civil penalties, which we do. As a colleague has said, they are frustrating. We similarly have about a 50% return on those, and years later we are waiting for some of them to come back.

Why is that?

It is a civil debt. Civil debt recovery is painful, at best, in terms of the time it takes to go through the bailiffs and get charging orders, and you are then taking it back into the court through the civil function. They are seen as a funding mechanism—people often say, “Your civil penalties will cover that”—but actually getting that back is a real challenge. For those who do not want to pay and are very robust about not paying—vacant landlords or people with companies—it is a real challenge to get the money back. It is definitely not a funding panacea. To pick up on the point made by Ian and others, it is about compliance. We are really good at achieving compliance without necessarily getting to enforcement. We would ideally spend most of our effort in that little middle bit, where all the effort is on education and achieving compliance voluntarily. Enforcement should only be the last resort, when nothing else happens. You would hope that you do not have vast numbers coming through in enforcement, because you are able to do it all in that middle section. There has maybe been an unwillingness to enforce at times, because of the complexities associated with it and the number of staff available to do that work.

I would just add that landlords are getting more and more productive at appealing civil penalties to the residential property tribunal, and that appeal can go on for two-plus years. Then it gets to appeal, and the civil penalty amount that you served gets reduced or amended. Debt recovery stalls at that point and it can go on for a couple of years. That is why it can take quite a lot of time. I would like to add that we generally get 70% of our work sorted out informally and 30% we do formally. So it is that balance. The other thing is that civil penalties notices do not get the repairs done in the house, but they do punish the landlord. We also utilise a small working default budget, meaning that when landlords do not do work such as fixing a boiler in the middle of winter, we can step in and do that. Then we charge the landlord and then we are in a debt recovery situation. Sometimes you need the issue sorted out in the house, and some enforcement powers do not result in that. They result in punishment.

Can you tell us a bit about the size and shape of your private rented sector and the prevalence and severity of poor housing conditions within that?

Manchester is a very large city. We have an estimated 100,000 private rented properties, which is higher than what the census says, which is 69,000. We have a varied private rented sector. We have some affluent areas and a high-end premium market. We have the medium end of the market. Overall, demand is outstripping supply and that is causing high rents across the city, even in some traditionally lower-rent areas. In the lower end of the market, often more leaning towards areas of deprivation, we have concentrations of professionally managed properties, with independent letting agents that might not know what they are doing. Right at the bottom end we have rogue landlords and criminal landlords. For all the introduction of new powers and everything, that bottom end that is hidden does not complain, and it still won’t complain. Some of these new powers are really useful to identify who landlords are at the criminal end. It is really important that we use some of this resource to do the proactive work. We expect complaints to increase over time as tenants become more empowered, because they have got new rights. We do not expect it to happen fully straight away. There will be an element of that. I think a lot of the tenants near the bottom end of the market will take time to get themselves empowered. That is why housing advice, education and knowledge is important. Damp and mould is our highest complaint category. Following the tragic death of Awaab Ishak, there was a 26% increase in requests for service complaints to us, and that has been sustained. That is good in a way—people are coming forward. Then we get lots of issues with fire hazards, electrical hazards, falls on the level and structural collapse. I think they are our highest level. Our second highest level of complaints is related to tenancy relations issues, which are illegal eviction and harassment. That is an area of work that our colleagues have mentioned where there a lot of training and knowledge are needed. All this guidance coming out for tenants and landlords will be really welcomed, but a workforce is just as needed there, in housing advice, to deal with harassment and all the new discrimination offences in the Act as well. They all need resourcing. I should mention where we see the poorest housing conditions. We have a lot of older stock in Manchester with concentrations of pre-1919 terraced houses. And we have what we call section 257 HMOs, which are buildings that have been converted into self-contained flats, but they do not apply for building regulations and do not comply. We have flats above shops and smaller HMOs that you might deal with through additional licensing. There seems to be anecdotal evidence that they are just shifting the market to avoid mandatory licensing, moving into small HMOs. We also have some B&Bs and temporary accommodation. This is what we use selective licensing for—to target. We have done 20 schemes since 2017—very small schemes. We utilise that to target areas where we have pockets of poor housing conditions. Just to mention selective licensing, I know there are considerations of—

We are going to come on to that. I am being mindful of time.

Right, sure. I have a point on that.

Joe, you have a very different area in Cornwall. Can you give us a picture of your private rented sector briefly?

We have a ratio of fifths. We have about 250,000 or 260,000 residential homes in Cornwall, a fifth of which—50,000 approximately—are private rented. Our understanding is that probably a fifth of those are non-decent, which is up to anywhere near 10,000 homes. We receive about 600 complaints a year from people experiencing problems in that sector. I guess my point, to build on some others, is our understanding that there is quite a high level of under-reporting and concerns about people not feeling empowered or understanding that the local authority is there to support them in such action, because the stats suggest otherwise. To pick up on some other points, we introduced a scheme—Cornwall Residential Landlords Association is setting a standard for our private rented properties, which we encourage landlords to join. That was a mechanism for us to hook up with them, to give them the advice and support they need. That has been very successful, with over 1,000 members of the scheme, covering some 15,000 in our PRS. We have had a lot of support. That is going to be very useful now, moving forward into—

In effect, you have your database already.

We did some other work to create that, actually. Using some Government pathfinder money, we invested in creating it. Originally, the nub of it was that we believed we had a significant issue with poorly converted section 257 flats associated with commercial activity. We used the pathfinder money, first, to intervene proactively—the ambition of most local authorities is to act proactively, not just to react to complaints—so we did that. I will speed up. We also created a database as part of that. We used the money to create a database, so we now have a database drawing on a range of data sources to tell us, by prediction, where our private rented sector is. We have that at address level, so I will be in a position to cross-reference that against those signing up to the portal.

Briefly, I think everyone welcomes the new database. Are there any quick things that you would still like to see from Government to make that a success, or are you just happy to see it come online?

Yes. The funding situation, like you said—what is arranged. We know that that will be a sustained level of funding, so once that is in place, once we know the date, we can start to have more conversations with our finance teams about putting posts out and how we are going to develop and grow people. That is really important.

One thing to say is that those compliant landlords will register. Those who are non-compliant will not, but the duty to get them falls to us as organisations as well, so there is an additional burden on us to enforce that. That is absolutely welcome, but those awkward landlords will still not register, so we will have to hunt them down.

From a stock point of view, Hull city council has, approximately, an estimated 28,000 privately rented properties. Looking at the English Housing Survey figures and the proportion of homes with damp, we are 11.1%, which is above the average of 9.6%. Looking at the proportion of non-decent homes, we are at 27.6%, which is nearly 7 percentage points above the average at 20.8%. Again, I totally agree with the points that people made about damp and mould being a big issue. I assisted the Department of Health in drafting the damp and mould guidance following the death of Awaab Ishak—I represented Hull city council and the CIH on that. The massive thing, of course, is intelligence and having that knowledge and information about those properties. Some work could be done with the DWP on information sharing. It can be difficult to get information from them. To do so would be a benefit. To reiterate the points made about priorities, are we a reactive service or a proactive one? Are we dealing with those who are in the greatest need or those who shout the loudest? I think that, sadly, lots of local authorities have become more and more reactive, rather than proactive. Hull has done some very proactive work with regard to its mandatory licensing, of course, but also supported accommodation. We are one of the five national pathfinders regarding supported accommodation with our review team. We have also undertaken some proactive inspections of asylum seeker accommodation. Mears is the contractor in our area, and sadly we have found a prevalence of poor housing conditions in that dispersal accommodation. So there is an issue about getting out there, lifting some rocks and seeing what we can find.

I am mindful of time, so this will be the final question. Obviously, licensing has featured quite a lot, and councils use many different licensing schemes. Do you think there are any barriers to implementing the licensing schemes, and what one thing would you change?

Selective licensing is quite bureaucratic. We welcome the fact that Secretary of State approval has been removed; that makes things easier. But we are still in the process of doing this. It has taken six months to get to the point of a decision for us as an organisation. We then have to implement that and resource it. So it is still quite a bureaucratic process, although it gives us the proactive ability that the Renters’ Rights Act still does not give us, and secured funding. So I think that the schemes are great and they are well worth using if you have the ability to get them over the line, but that takes quite some time.

We have not embraced this in Cornwall yet, but my understanding is that it would be very helpful to use licensing schemes to enforce improvements to the standards. That is not currently an option available. You can under a mandatory scheme, but not under the selective scheme, so that would be my ask.

My view is similar, really. The schemes can be bureaucratic and everything, but we have been using them successfully. Up-front costs can be a challenge. What would be an improvement? The proposal for this scheme is for 10 years. We are behind that, especially because you can grow your workforce, you can sustain it for 10 years, you can see improvements for longer and you can track what is going on for longer. So we are definitely behind that.

We have not as yet introduced an additional or selective licensing scheme, but it is something that we are regularly reviewing and looking at. With regard to one of the points that Ashlea made earlier, we also have some anecdotal evidence that people have reduced the occupancy level from five to four to avoid mandatory licensing, and we are obviously concerned as to why they may want to do that. On the proposal that has been suggested with regard to increasing the additional and selective licensing term from five to 10 years, we would welcome that as well.

Great. Thank you very much for attending the Committee this morning and helping us with our deliberations.