New Schedule 1 - ‘Further provision about social housing rents - Part 1 - Provision about levels of rents

Part of Welfare Reform and Work Bill – in a Public Bill Committee at 10:45 am on 20 October 2015.

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Tenancy of existing social housing

1 (1) This paragraph applies in relation to a tenant of social housing in England if—

(a) the tenancy begins after the beginning of 8 July 2015,

(b) the accommodation was social housing during the period starting with the beginning of 8 July 2015 and ending with the beginning of the tenancy.

(2) This paragraph does not apply if paragraph 3 applies.

(3) The registered provider must secure that the maximum amount of rent payable to the registered provider by the tenant in respect of—

(a) the first relevant year, where the tenancy begins before or at the beginning of the first relevant year,

(b) the part of the relevant year in which the tenancy begins, where the tenancy begins after the beginning of the first relevant year and not at the beginning of a later relevant year,

(c) the following relevant year, where the tenancy begins as described in paragraph (b), or

(d) the relevant year, other than the first relevant year, at the beginning of which the tenancy begins,

is no more than would be payable if the tenant were paying rent at the higher of the social rent rate and the assumed rent rate in respect of that relevant year or that part of a relevant year.

(4) The social rent rate, in relation to the rent payable by a tenant of social housing in respect of the first or a subsequent relevant year, is the rate found by—

(a) determining what would have been the rate of formula rent for that social housing at the beginning of 8 July 2015,

(b) determining the rate of that rent when expressed by reference to a period of 12 months (if necessary), and

(c) at the beginning of each relevant year (up to and including the relevant year in question), making a 1% reduction in the rate.

(5) The assumed rent rate, in relation to the rent payable by a tenant of social housing in respect of the first or a subsequent relevant year, is the rate found by—

(a) determining the rate of the rent that—

(i) was payable to the registered provider by the tenant of that social housing at the beginning of the relevant day, in a case where the relevant day falls after 8 July 2015 and the tenancy that exists at the beginning of 8 July 2015 does not come to an end before the beginning of that later day,

(ii) was payable to the registered provider by the tenant of that social housing at the beginning of 8 July 2015, in a case where the relevant day is 8 July 2015 or the tenancy comes to an end before the beginning of a later relevant day, or

(iii) is likely to have been payable to the registered provider by a tenant of that social housing at the beginning of 8 July 2015, if there was not a tenant at that time,

(b) determining the rate of that rent when expressed by reference to a period of 12 months (if necessary), and

(c) at the beginning of each relevant year (up to and including the relevant year in question), making a 1% reduction in the rate.

(6) If—

(a) the tenancy comes to an end after part of a relevant year to which sub-paragraph (3) applies has elapsed, or

(b) sub-paragraph (3)(a), (b), (c) or (d) ceases to apply in relation to the tenancy after part of the relevant year in question has elapsed,

sub-paragraph (3) has effect in relation to the part of the relevant year falling before that time with a proportionate reduction in the maximum amount of rent payable to the registered provider by the tenant.

(7) The Secretary of State may by regulations define “formula rate”.

(8) Regulations under sub-paragraph (7) may, in particular, make provision by reference to—

(a) standards issued by the regulator under section 194(2A) or 198(3) of the Housing and Regeneration Act 2008 (the powers of the regulator to set and revise standards relating to levels of rent) providing for the determination of social rents, or

(b) guidance issued by the Secretary of State relating to the determination of social rents.