Sir Robin the Hood?
How do you write about a terminally boring, hugely complicated, but very important subject?
And especially a subject that could have 10 volumes written about it, and still only have the surface scratched?
I’m talking about Rental Law, and the mess it is in, and the random (and very expensive) consequences of the 2004 Housing Act, a badly drafted law taken through Parliament far too quickly in the heydey of the Blair-Brown legal avalanche.
It is the best part of 350 pages without the supporting notes.
It has required millions of pounds to be spent on litigation to sort out what it actually means since it was passed, paid for by the public purse (therefore taxpayers) and landlords (therefore tenants).
And we are still cleaning up the mess; the latest version of Tenancy Deposit regulations only came into force this Financial Year.
We have Selective Licensing (for all landlords in areas needing improvement if the local council can convince the Government there is a problem due to low rental demand or anti-social behaviour), Mandatory Licensing of Shared Houses (now called HMOs), and Additional Licensing of more HMOs if the Council wants to do so.
Let me talk about Selective Licensing for a moment.
It has been taken up by 20 Councils in England out of roughly 400.
Certain councils have developed a distinct habit of failing to consult properly. In Oxford a High Court action caused the whole process to be declared illegal and they had to reconsider, but only after hundreds of thousands of pounds had been spent on an illegal process and a High Court action.
But the Council had ignored earlier feedback, which tells us something about consultation processes and political objectives pursued without regard to reality.
Take Sir Robin Wales, Mayor of Newham, and his proposal to require licenses for everybody who rents out one of the 37,000 rented houses in the Borough, and to charge them £500 each for processing the paperwork relating to each property (with a discount to £150 for any who apply by early 2013) for a 5 year license.
In Scotland, which has been running a licensing scheme since 2006, the fees are £55 per landlord and £11 per property for a 3 year period.
For a small professional landlord with 10 properties, the comparison is £165 for 3 years in Scotland, and up to £5000 for 5 years in Newham, depending on the exact fee structure. I would add 50% on top to pay the landlord or their staff to do all the paperwork.
That’s a major difference to add to the overheads in the rent paid by tenants.
This compares with the estimated cost to the Council of £509.80 in the 2010 initial application to set up a single license: (Click for a big version):
- Newham Selective License Costs I
- Newham Selective Licensing 2
45 minutes and £33 to bank a cheque when you are dealing with them by the thousand?
30 minutes and £19 to do a £4 check on a Land Registry Entry when they are doing almost 10,000 per year?
What do you think?
It’s a hell of an expensive process to require tenants to fund, and I question whether Sir Robin and his team are competent to run an efficient licensing scheme if they think that those are realistic estimates of what it should actually cost.
And that is completely ignoring the questions over whether it will actually do any good, or is even legal.
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1
May 31, 2012 at 07:13 -
Never underestimate the capacity of a bureaucrat to design a system so complicated , that it completely justifies his existence in the eyes of other bureaucrats.
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2
May 31, 2012 at 08:45 -
Having had the misfortune to live in Newham, Robin Wales and his crew couldn’t run a whelk stall.
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3
May 31, 2012 at 10:03 -
So every five years Newham need to hire an extra 300* odd people to process the 37,000 applications in a year. Or more to get the work done in less than a year. If we follow the Newham council and round everything up we could call it a thousand extra temporary staff. They’ll need managers and those managers will need managers. A huge budget and a huge empire for someone in the council.
It’s interesting that the minimum time taken for each step are 15 minutes. And that many steps seem to have been created just so that an extra 15 mins and £33 can be added to the total.
In a private business this process would be carried out to argue why something should not be done. In the public sector it seems that all laws are counter intuitive and the process is a way of arguing for something to be done.
* Each person working 7hr/day can process about 100 applications a year. 37,000 applications can be processed by 400+ people in a year.
+ I’ve rounded up each time.
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5
May 31, 2012 at 11:03 -
Er, data entry clerks earn £33.40 per hour? Nearly £70K a year for a 40 hour week? What?
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6
May 31, 2012 at 13:07 -
To be fair a lot of that may be overheads, but there’s also a productivity question.
The real problem is more one of cost estimates pulled out of someone’s backside not being questioned, and the lack of checks and balances.
It moos like a cash cow, and some seem to see it as such.
One of the issues is that these schemes are bastards to turn back, because if the Council ignores sensible consultation responses you are into High Courts and Judicial Reviews.
And there are the rises…
In Norwich this spring, they jumped the HMO License Fee from £270 to £1800 in one go.
http://www.property118.com/index.php/hmo-licence-fees-up-650-percent/23528/I think that one was withdrawn after an outcry, though.
In my neck of the woods, the Selective License fee in areas where it applies will be an extra week’s rent every year on a 3 bed family house.
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7
May 31, 2012 at 12:37 -
Newham are of course going for backdoor taxation, and finding a suitable political target, Landlords, who are of course anathema to the left.
If this proposal goes forward it will decrease private rental stock, exacerbate housing problems, and gift the left with another cause to pursue. Nationalisation of housing.Yet another pox and plague on ‘em.
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8
May 31, 2012 at 13:20 -
Penfold, as someone who sadly knows Newham but who happily no longer lives there I’d just like to say that it’s not just landlords whom Newham is going after. They are also going after the drivers who live in the south of the borough, charging people the earth and treating them like scum. It would be interesting to see if the same aggression from council staff aimed at the denizens of southern Newham is being used on residents and drivers in the more ‘culturally enriched’ areas of the borough.
Newham is a corrupt cackhole and although I’m really glad I no longer live there I worry for my friends and relatives who still have to endure the place.
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10
May 31, 2012 at 23:59 -
Wikipedia :
“Robin Wales was born in Kilmarnock, East Ayrshire, Scotland in 1955,[1] and was educated at the University of Glasgow where he read Chemistry and was chair of the Glasgow University Labour Club. He formerly worked at British Telecom.”Robin Wales, a mini Gordoom Brown-is that an adequate explanation?
Newham has always been one of the poorest boroughs in Britain, yet consistently elects liebour representatives, it is a text-book liebour rotten borough.
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12
June 1, 2012 at 07:53 -
R.O.R.T.
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13
June 1, 2012 at 13:39 -
They just hate the private rented sector and are doing whatever they can to obstruct and stifle it.
If they could ban renting (except from them, of course) completely, they would.
Socialism – you know it makes sense.
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