When Abdul Basit first bought his property in an East London tower block, he didn’t expect it to lead to a crash course in housing law. But fourteen years on, he’s found him-self investing in legal texts to force accountability of what he believes are erroneously increasing service charges because, until he took action, his request for evidence appeared to fall on deaf ears.
Exponentially rising service charges on managed and multi-unit housing is a problem across the country, but for housing association residents, both tenants and leaseholders, the lack of scrutiny over these expenses has forced them to go as far as striking against ‘unbelievable’ and un-evidenced charges.
Social Housing Action Campaign (SHAC), a membership organisation that advises residents on getting redressed for housing issues, has documented many of these complaints in its surveys. The results from the seventy-two cases it collected found poor record-keeping by the association meant residents couldn’t fully understand how their charges were calculated. When records are retrieved, errors are found mostly against the resident, including in the apportionment of costs split incorrectly between several flats or blocks of flats, meaning they pay a disproportionate share of the cost of communal services. Attempts to query the errors are deterred through an inept complaints system.
‘It’s a war of attrition’, says Suzanne Muna from SHAC, describing the lack of accountability. She adds that this is particularly true for housing associations — private non-profit organisations once defined by a philanthropic mission to help alleviate homelessness.
Under the New Labour government, housing associations became the preferred social housing provider. Loss of government funding and the need to compete in the open market since has however meant many deem providing the same level of social housing less viable. Now they supplement their income with more private and ‘affordable housing’, with any rents applied at up to 80 per cent of the market rate, compared to the usual 50 per cent rate for social housing.
Since the Conservatives came to power, oversight for housing associations has weakened. That includes the framework of the Regulator of Social Housing and the system of sanctions from the Housing Ombudsman which, according to Muna, are too low to have an impact.
Many housing associations also have convoluted complaints processes, which mean issues get lost via an online form or at the end of a phone where the person has no power to address the resident’s issues. If the complaint isn’t addressed in thirty days, it needs resubmitting to pursue, in SHAC members’ experience.
This ‘attrition’ has compelled residents to revert to sections 21 and 22 of the Landlord and Tenants Act 1985, which state that residents have the right to inspect supporting accounts and to withhold service charges until the Landlord provides a report of costs.
Carley Probert, whose Maidstone property is managed by Hyde Housing Group, felt the need to take matters into her own hands when her constant requests to see evidence for 2019/20 charges, which had jumped from £127 to £376 per month, were left unaddressed. The rise was impacting her ability to pass the property on, a problem she even tried channelling through the resale team, asking: ‘How will you market my property with a service charge of over £350 a month?’
After knocking on the doors of her neighbours, Probert found they were equally distressed. Together, they formed a Residents Association; now, three of them are on strike while five have submitted a joint application to the first-tier tribunal — the property chamber to resolve housing disputes — hoping for a final resolution.
Dan Archer joined Probert in the strike and admits he would never have moved had he known the service charge would rise as much as it did. Archer, dissatisfied with the services for fees he calls ‘unbelievable’, says there has been no other way to air a grievance, frustrated at what he says is much disjointedness within Hyde.
Basit said he had learned from the experiences of other residents striking, such as at Hyde, saying there’s ‘power in sharing information’. He has been waiting months for Tower Hamlets Community Housing (THCH) to resolve irregular apportionment of costs for his block and other concerns over service charges, telling him they need time to recheck the invoices.
‘Why can’t I see them in their current state?’ reasons Basit, suggesting it indicates irregularities. Any action by THCH, however, has been a long time coming, he says, as they only started to address his concerns once more residents started speaking up and who will inevitably start a service charge strike if the statutory time limit passes without action. This possibility worries the housing association, he believes; before, even withholding his service charge payments had elicited no response.
A THCH spokesperson told Tribune it was committed to ensuring residents understand the calculations and get their feedback on services, but said, ‘Where payment is withheld by leaseholders, this places an undue burden on our rented customers, which is not acceptable.’
Scott Lawrence, Hyde’s Head of Property Charges, also responded for comment, saying they were aware of the significant rise in service charges this year and are being as transparent as possible with the reasons for increases while in discussion with customers who are withholding payment. He also pointed to information on their website explaining some large increases.
Service charge strikes have been partially successful in the past, including at Hyde, where the housing group agreed to a service charge reduction after the resident and his neighbours received demands amounting to a 57 per cent increase. The result came just a few weeks after James Hart contacted the housing association, in contrast to the years he’d spent challenging what he calls unfair charges using Hyde’s complaints procedures, a strike he vowed to continue until they lowered the charges to a level he deemed legitimate and proportionate.
Housing Association giants Clarion and One Housing Group (OHG) have also been taken to task. In the latter, a striker, Chris Jones, reported to SHAC that OHG responded faster than previously and offered compensation and an apology, which Jones accepted, making clear the strike tactic would be used should further issues arise. He told SHAC, ‘based on my experience now, this is the only language that the landlord understands.’
Muna says withholding service charges doesn’t have to be a last resort: ‘In no other area of life would you pay first and have the argument afterwards.’
Basit hopes that despite the energy challenging THCH is taking from him, it will inspire other residents to challenge unjust charges. Otherwise, he says, ‘These associations are just going to constantly take the biscuit.’