We will always do everything in our power to protect our members and their tenants
Blog by Sally Thomas, SFHA Chief Executive.
This week saw the Coronavirus (Scotland) (No.2) Bill enter its final stages in the Scottish Parliament. This was the second bill to be introduced in response to the current pandemic and was intended to create emergency measures to protect people facing financial hardship and to allow public services to operate effectively.
However, it was the amendments lodged by the Scottish Green’s Housing Spokesperson, Andy Wightman MSP, that garnered attention in the media and on Twitter. While well intended, these amendments would have had dire consequences for social landlords and the people they house – the very people they were intended to protect.
Mr Wightman submitted amendments that called for:
a two-year rent freeze from the date on which the Coronavirus (Scotland) (No.2) Act came into force
the liability for rent arrears incurred during the Covid-19 period to be ‘extinguished’
arrears built up during the emergency period to be disregarded.
SFHA submitted our response to the amendments and called on MSPs to support our position. Mr Wightman’s amendments did not pass.
Opposing these amendments was of paramount importance for our members and their tenants. What they didn’t take account of is that rental income is vital for housing associations and co-operatives as it comprises the majority of their income. It allows them to provide support and services for tenants and to carry out essential repairs and maintenance work. These frontline services are needed to ensure the health, safety and wellbeing of tenants. It is critical they can continue if we are to work together to minimise the impact of the coronavirus outbreak, particularly on the most vulnerable people in Scotland’s communities, many of whom live in social housing.
The social housing sector is also a vital part of the government’s ambition to continue delivering the affordable homes the country desperately needs, through new build and regeneration. Housing associations also have a key role to play in contributing to fuel poverty targets through delivering energy efficiency measures and, in recent years, they have had to meet new safety standards. They must meet all of these costs in order to remain viable and to deliver on the obligations placed upon them by the Scottish Housing Regulator and Office of the Scottish Charity Regulator, with the majority being registered charities.
Deciding to increase rents is not a decision that is taken lightly, and it involves a long process, with months of planning and modelling before consultation with tenants begins. There is a delicate balance to be struck between keeping rents low, providing essential services and meeting the substantial additional cost pressures facing the sector – and, to do this, housing associations must be able to increase rents if this is needed.
Any lost rental income as a result of these amendments would, ultimately, have led to increases in rents for other tenants in order to recover the loss – which is exactly what our sector – and Mr Wightman – wants to avoid.
In 2019, research by the Joseph Rowntree Foundation found that poverty levels are significantly lower in Scotland, compared to the rest of the UK, due to lower housing costs, particularly in the social rented sector. Guaranteed rental income is required to maintain this position.
Housing associations have always worked hard to help tenants to manage their rents through tenancy support, welfare advice, and financial inclusion services – and they will continue to do this. They have a strong record of supporting tenants through difficult times, and these efforts are more important and necessary than ever in the face of the current coronavirus crisis.
SFHA remains committed to protecting tenants who are struggling financially. However, a freeze on rents or a disregard of rent arrears is not the answer. We know that serious concerns remain over the Universal Credit system – particularly the five-week wait for payment. SFHA will continue to lobby for change and consider the best way to protect tenants. We await the detail regarding how the extra £5 million of Discretionary Housing Payments, announced yesterday by the Housing Minister, will be administered by local authorities, but we would urge them to use the funds to support tenants who could otherwise fall into arrears as a direct result of the pandemic.
SFHA will always do everything in our power to support our members and their tenants. But it has to be best approach for all tenants and not one that inadvertently harms the very people and communities we are here to protect.