Social Housing (Regulation) Bill – amendments

The Social Housing (Regulation) Bill has been making its way through the various readings in the House of Lords. On the 31st October, the Bill received its 3rd reading, being the final stage in the House of Lords. The Bill is now to be considered by the House of Commons before it receives Royal Assent.

When the Bill was first introduced in June this year, we commented on the draft provisions in an article published here.

As the Bill has gone through its readings in the House of Lords there have been a number of amendments. In this article we have set out an update of some of the most significant changes to the original draft which RPs should be aware of.

• An amendment has been included to the fundamental objectives of the Regulator, to state that energy efficiency of social housing is part of the consumer regulation objective.
• The Bill also introduces the ability for the Regulator to set a consumer standard relating to energy demand. This new section goes into some detail, requiring the Secretary of State to publish a strategy on reducing energy for social housing properties which, amongst other things, includes a requirement for all social housing properties to attain a minimum EPC rating of C by 2030.  The detailed elements of this section including the 2030 EPC C requirement were opposed by the Government and it may be that the Government will remove or further amend these requirements as the Bill passes through later Parliamentary stages.
• The Bill introduces the ability for the Regulator to set a new consumer standard relating to competence and control of individuals involved in the provision of services in connection with the management of social housing. It is stated that the standard may contain specific rules about knowledge, skills and experience of individuals and the conduct of such individuals in their dealings with tenants.
• The amendments now repeal sections 198A and 198B of the HRA2008, which set out general grounds for the exercise of intervention powers by the Regulator. The amendments instead amend the powers themselves to adjust the grounds on which they can be exercised. 
• The amendments to the Bill introduce a new section relating to inspection plans, which imposes a duty on the Regulator to implement a plan for regular and one-off inspections of RPs.
• The amendments to the Bill make some clarifications to the provisions regarding emergency remedial action and the power to enter a property without a warrant.
• The current draft of the Bill now includes a section which clarifies the wording in the Housing and Regeneration Act 2008 (HRA2008) on the Regulator's ability to charge fees on initial registration and on a continued basis. Specifically it clarifies that the Regulator may charge fees for dealing with applications which are not successful and may require payment in advance. It also makes clear that the fees may be set at a level to cover all of the costs of the Regulator (including costs unrelated to the registration process).
• The Bill now amends the HRA2008 such that where an RP company converts into a registered society, the Regulator no longer has to make a registration decision for the converted entity. The RP's registration will simply continue.
• An amendment is now included which requires an RP to make a notification to the Regulator where that RP undergoes a "change of control". This includes situations where in a "relevant period" (a) the board increases in size by more than 50%; (b) the board decreases in size by more than 50%; or (c) more than 50% of the board are persons who were not previously board members. An RP must also notify the Regulator where it becomes or ceases to be a subsidiary.
• The Bill now amends the definition of "subsidiary" set out in the HRA2008, The definition now cross-references the definition set out in the Companies Act 2006, whilst making clear that it applies to any undertaking and not just a company.
• An amendment has been included which now requires a housing ombudsman scheme to include a duty on that ombudsman to monitor compliance with its issued code of practice. The amendment also makes clear that subscriptions payable by members of a housing ombudsman scheme may be set at a level to cover all of the costs of the scheme administrator and ombudsman, including enforcement costs and other costs unrelated to the scheme.

• Amendments to the Bill have been proposed which amend the provisions relating to accounts set out in the HRA2008, so that those provisions also apply to an RP which is an LLP.

Although the Bill has now finished its passage through the House of Lords, it is not yet in final form. It is now to be considered in the House of Commons before it receives Royal Assent, and so we may yet see further amendments before this comes into law.

Update as of 8 December 2022: on the 28 November 2022, in the Committee stage in the House of Commons, the Bill was amended to remove the requirement for a specific consumer standard on energy demand. This amendment also removes the requirement for all social housing properties to attain a minimum EPC rating of C by 2030. 

It should though be noted that "energy efficiency" is still to be included as one of the Regulator of Social Housing's statutory objectives. The Bill also still allows the possibility (but not the requirement) for the Regulator to include energy efficiency within the consumer standards. This may mean that the Home Standard is amended to include specifics around energy efficiency. We would recommend that RPs look out for the latest version of the developing thinking paper from the Regulator which we are expecting to see before the end of 2022.