An overview of the Localism Act 2012 from a housing perspective

1. The Localism Act 2011
Peter Bird
Primary Business Support
www.primarybs.co.uk
Tel. 01264 324403

2. Background
“The time has come to disperse power more widely in Britain
today.”
The Prime Minister and the Deputy Prime Minister, Coalition
Agreement, May 2010

3. Summary of Contents
Ref Heading
Part 1 Local Government
Part 7 Housing
Part 2 EU Financial Sanctions
1 Allocation and Homelessness
Part 3 EU Financial Sanctions: Wales
2 Social Housing: Tenure Reform
Part 4 Non-Domestic Rates Etc
3 Housing Finance
Part 5 Community Empowerment
4 Housing Mobility
Part 6 Planning
5 Regulation of Social Housing
Part 7 Housing
6 Other Housing Matters
Part 8 London
Compensation For Compulsory
Part 9
Acquisition
Part 10 General

4. Key Housing Issues for HAs
• Social housing tenure reform
• Reform of social housing regulation
• National Home Swap Scheme

5. Social Housing
Tenure Reform
• Existing tenants’ position is retained.
• New ‘Flexible Tenancies’ can be for limited periods; can be 2 years
in exceptional cases, but 5 years expected to be the norm. No
upper limit to length of tenancy.
• Will be used alongside ‘Affordable Rents’, although the Affordable
Rents regulations are not part of the Localism Act (rents and tenure
are now separated).
• Landlords can retain lifetime tenancies if they wish, but Flexible
Tenancies:
• will be required under HCA funding agreements for new
properties built under the Affordable Homes Programme.
• can be introduced for relet properties with HCA consent.

6. Social Housing
Tenure Reform
• HAs must publish ‘clear and accessible policies’ which outline their
approach to:
• The length of any fixed term tenancies (eg Flexible Tenacies).
• Any exceptional circumstances in which they will grant fixed
term tenancies of less than 5 years.
• Any circumstances in which they may/may not re-issue at the
end of the fixed term.
• What advice/assistance they will give to tenants when the
tenancy is not to be re-issued.
• Details of any grant of rights of succession.

7. Social Housing
Affordable Rents – an aside
• Tenancy of residential premises let by an Registered Provider.
• At a rent higher than social rent, up to 80% of the market rent of a
property:
• of the same size and type
• in the private sector
• to include service charges.
From 1st April 2012 rents and tenancies will become independent of
each other, which will potentially lead to a multitude of
combinations…

8. Tenure and Rents
Combinations Possible
1. Fixed term (assured shorthold) at social rent
2. Fixed term (assured shorthold) at affordable rent
3. Periodic (assured) at social rent
4. Periodic (assured) at affordable rent
5. Fixed term (flexible) at social rent
6. Fixed term (flexible) at affordable rent
7. Periodic (secure) at social rent
8. Periodic (secure) at affordable rent

9. Ending Fixed Term Tenancy
(at expiry of term)
• Landlord must give six month notice informing tenant that:
o Tenancy will not be renewed/re-issued.
o How the tenant can get help/advice.
• Landlord must also serve notice that it intends to seek possession
at the end of the fixed term (s21 notice).
• Act gives no right to review (but could be in the Landlord’s policy).
NB failure to serve both notices will result in the tenant becoming a
periodic tenant.
Tenant can end tenancy, at any time after expiry of the fixed term, by
service NTQ.

10. Ending Fixed Term Tenancy
(mid term)
• Only on a ground expressly referred to in tenancy.
• Certain grounds not available:
o All mandatory grounds (except ground 8 – arrears of rent).
o Discretionary grounds 9 (suitable alternative accommodation
offered) and 16 (tenant was an employee of the landlord).
o Cannot move to suitable alternative accommodation.
• But can have ‘break clause’ (min two years).
• Surrender does not apply (unless permitted by tenancy).
• Any breach can be actioned as usual.

11. Reform of
Social Housing Regulation
• Abolishes the Tenant Services Authority
and transfers the TSA functions to the
Homes and Communities Agencyfrom
1st April 2012.
• Changes the way complaints are
referred to an ombudsman.

12. Abolition of the TSA
• Requires the creation of a ‘Regulation Committee’ of
the HCA to deal with issues previously dealt with by
the TSA.
• Committee to have an appointed Chair and 4, 5 or 6
appointed members (currently Chair + 4 appointed).
• May have sub-committees that may include non-
members.

13. Economic Objectives
• To ensure that RPs are financially viable.
• To support the provision of housing to meet reasonable
demand.
• To ensure Value for Money.
• To ensure that there is no unreasonable burden on
public funds.
• To guard against the misuse of public funds.

14. Consumer
Regulation Objectives
• To support the provision of housing that is well
managed and of appropriate quality.
• To ensure prospective and current tenants have
choice and protection.
• To ensure tenants have the opportunity to be
involved in the management of their homes and can
hold their landlord to account.
• To encourage RPs to contribute towards
environmental issues, social issues and economic
well being of the areas in which they operate.

15. Referring Complaints to the
Ombudsman
• All social housing complaints to be referred to the
Housing Ombudsman Service (inc LA tenants).
• Complaints to normally be considered by a
‘designated person’ in the first instance.
• Designated person is an MP, a member of the local
housing authority or a designated tenant panel.
• Complaints can be referred direct to the Ombudsman
once eight weeks have elapsed from the completion
of the RP’s internal procedure, or where the
Designated Person agrees, or refuses, to investigate.

16. National Home
Swap Scheme
• The Act ‘paved the way’ for a National Home Swap
Scheme.
• It makes way for regulation by the HCA that will
require RPs to participate in the new ‘Home Swap
Direct’ scheme that effectively the brings together the
four existing independent internet based mutual
exchange schemes (HomeSwapper, House
Exchange, Abritas and LHS (Locata)).

17. Other Housing Issues
• Social housing allocations reform
– Allowing LAs to set their own priorities for allocations.
• Reform of homelessness legislation
– Allowing LAs to meet their obligations by offering private sector
accommodation and removing the applicants’ option to refuse on the basis
that they would prefer a property provided by a RP.
• Reform of council housing finance
– Allowing LAs to retain their rental income rather than having to send it to the
Government to redistribute.
• Abolition of Home Information Packs
– Confirming the abolition that has effectively been implemented
NB Energy Performance Certificates remain.

18. Planning Impacts
• Abolition of regional strategies
• Neighbourhood planning
• Community right to build
• Requirement to consult communities before submitting
certain planning applications
• Reforming the community infrastructure levy
• Reform the way local plans are made

19. Other Possible Impacts
• Community right to challenge
• Community right to bid (assets of community value)
• Right to approve or veto excessive council tax rises

20. Conclusion
The Localism Act covers a wide range of
services. Some aspects are relevant to all
social housing providers; others are
relevant to local housing authorities and
others affect other aspects of local
authority services that are peripheral to
social housing providers (and
developers).