Summary
The Houses in Multiple Occupation (Asylum-Seeker Accommodation) (England) Regulations 2023 will remove newly procured HMO properties from HMO Licensing and Management Regulations when they are procured by the Home Office and its contractors for use as accommodation for asylum seekers. Our understanding is that properties in Discretionary Licencing Areas (areas where all privately rented accommodation – including HMOs and other private rented accommodation – needs to be registered with the local authority) will not be affected.
London Councils is concerned about the decision to exempt asylum accommodation from HMO licensing requirements for a period lasting potentially until 2026 for some properties.
We are particularly worried about the impact this will have on (i) accommodation standards for asylum seekers in HMOs and the creation of a two-tier system of rights for our residents, (ii) the lack of a reliable, independent assurance as part of these plans to safeguard against a drop in standards, and (iii) further challenges for local authorities in procuring accommodation for homeless households if landlords are incentivised to let their property to Home Office providers due to this exemption.
We also question whether there is evidence to suggest that the change in regulations will speed up procurement of accommodation for the Home Office, and that the change could therefore undermine safety and standards within an already high-risk part of the housing sector, without delivering the Home Office’s intended outcome.
Poorer standards and a two-tier system of rights for occupants
- The changes will remove mandatory inspections and standards for HMO properties, as defined in the above regulations. HMO regulations require the manager of the property to meet a ‘fit and proper’ person test and demonstrate compliance with various safety requirements. Councils can also use licencing to impose conditions, such as those related to management practices and maximum occupancy levels. The proposed changes lessen Housing Act controls but are silent on planning controls, which will still be in play.
- The changes will create a two-tier system for the rights for occupants, with HMOs accommodating asylum seekers having a lower statutory standard and enforcement regime (via routine local authority inspections) than HMO accommodation used by other occupants.
- As well as removing larger contingency sites used by the Home Office (such as hotels) from the regulations, the regulations seek to remove properties provided under S95 of the Immigration and Asylum Act 1999 from HMO requirements, which were specifically stated to be within the scope in the Licensing and Management of HMO Regulations in 2006.
- Removing properties from the HMO licensing regime is likely to create management and monitoring issues, resulting in poor providers getting away with providing unsuitable and possibly dangerous accommodation.
- Councils have already raised a number of safeguarding concerns with the Home Office regarding the use of hotels (including issues with checks on and training for staff, safeguarding referral and assurance processes/risk assessments). Many councils have also raised serious concerns about overcrowding, and safeguarding concerns regarding the lack of space for children and babies.
- The Home Office is relying on existing assurance processes to guarantee standards. The minimum standards will be those already set out by the Home Office and there is currently a lack of transparency on how these standards are enforced.
- Councils will still have a Part 1 Housing Act 2004 responsibility to ‘keep the housing conditions in their area under review with a view to identifying any action that may need to be taken by them under any of the provisions’ within scope to maintain property conditions. However, these teams are under-resourced, are part-funded by fees generated through granting licences, and the removal of HMO regulations will further undermine their ability to enforce if there is a lack of information on where homes are procured and household details.
Operational impact of the changes
- London boroughs are facing an acute and worsening position in securing accommodation for homeless households. Data collected by London Councils shows that the number of households owed a homelessness relief or prevention duty were 14.4% higher in February 2023 compared to the same month a year previous.
- Challenges in the private rented sector are making it more difficult for councils to procure and retain suitable accommodation, a situation exacerbated by competition with Home Office contractors for properties. Data provided by 25 London boroughs shows they procured 26% fewer private rented sector properties for homeless households in February 2023 than the same month a year earlier, and the total number of temporary accommodation properties requested back by landlords was 150% higher over the same period. As a result, the number of households in unsuitable Bed and Breakfast (B&B) accommodation was 167% higher in February 2023 compared to the same month a year earlier. Data provided by 23 councils show the number of families in B&B accommodation for longer than six weeks was up 823%.
- London local authorities have worked collaboratively to better manage the cost and standards within temporary accommodation in London. The Inter-Borough Accommodation Agreement (IBAA) allows councils to set a maximum rate for temporary accommodation in their area, which other local authorities will seek not to pay above when making a placement in that area, thereby reducing price escalation and helping to accommodate more households. Setting the Standard was also established as a shared service by London local authorities to provide property inspections of the highest risk part of the temporary accommodation sector.
- The changes to HMO regulations will further incentivise landlords to switch their properties away from supporting homelessness residents placed by the council and to take up an offer from the Home Office contractors, who frequently pay more than councils and will now ensure that landlords can avoid regulatory requirements and fees for the licence. This will put further pressure on councils’ ability to manage homelessness pressures, and risks driving up costs for all public sector bodies procuring accommodation. The use of commercial hotels by councils has also been increasing, in part as a result of the systemic challenges within the private rented market and as a result of losing accommodation to Home Office contractors.
London Councils’ key asks of government
- The Home Office should provide prompt information of HMO proposals and where they are.
- Contractors should provide local authorities with information on all properties procured in their area to show that maximum occupancy rates are not being breached.
- There must be clear independent assurance processes (not led by Home Office contractors) that management regulations, quality and safety are being addressed, and processes and transparent reporting should be put in place to demonstrate this. There must also be clear engagement routes with the provider and management company, as well as to escalate any issues. London Councils has been calling for the Home Office to work more closely with councils to oversee standards (for example, by jointly working with the Setting the Standard programme in London, to provide an assurance process to monitor standards within the HMOs that would not be subject to licensing regulations).
- Home Office contractors in London must participate in the IBAA agreement to limit competition, reduce costs to the public sector, and prevent a further worsening of councils’ ability to procure accommodation to meet their homelessness duties.
