Understanding the Housing Legislation Amendment Bill 2016

People often ask us what we mean when we talk about Social Housing. How does it differ from Public Housing? Where does Community Housing come from? Aren't they different names for the same thing? And is there even really such a thing as Affordable Housing? What about housing co-ops or housing that's owned and managed by Aboriginal Housing Corporations or Local Aboriginal Land Councils?

We'd love to write something that sorts all this out once and for all, but there's a problem: the whole kit and caboodle just keeps changing.

Don't look now, but it's about to change again. Yesterday the Minister for Disability Services, Ageing and Multiculturalism, John Ajaka, introduced the Housing Legislation Amendment Bill 2016 into the Legislative Council of NSW.

If passed, the bill will do two things:

... amend the Housing Act 2001 with respect to the entry of concurrent leases; and amend the Community Housing Providers (Adoption of National Law) Act 2012 with respect to the registration of, and provision of assistance to, community housing providers that cannot be registered under the Community Housing Providers National Law (NSW).

So - what does all of that mean?

The first thing - concurrent leases - concerns the transfer of Social Housing tenancy management from Public Housing to Community Housing. The Minister for Social Housing, Brad Hazzard, recently announced the transfer of an additional 18,000 tenanted properties (approximately) "to ensure a better experience for tenants in Social Housing". Critically, Hazzard announced that "tenants' lease length and lease conditions will remain the same, their income after rent will remain the same and FACS will keep tenants fully informed as their areas transition to community housing providers".

But the Housing Legislation Amendment Bill 2016 makes it clear that, under the proposed property transfer scheme, tenants will not be given a choice. Many of their counterparts in previous schemes did have a choice - albeit a limited one. Some tenants were able to decline to participate in an earlier property transfer program, such as a group in South Coogee in 2009. Others were not, and there are now entire areas across New South Wales where FACS Housing no longer operates as a landlord. The properties, and the tenants, remain, but now they have a Community Housing landlord. Returning for a moment to Minister Hazzard's announcement, it looks as though four new areas are to be added to the list: the Shoalhaven, Northern Sydney, Mid North Coast and Hunter/New England (excluding Newcastle and Lake Macquarie LGAs). We expect many tenants in these areas will have found this news unsettling, and the lack of choice to be afforded them insulting.

But the introduction of "concurrent leases" potentially resolves some of the pragmatic concerns that tenants would factor into their choice, if they had one. A concurrent lease allows those property rights and interests that have not been passed on to, say, a residential tenant, to be transferred to a third party. Lawyers would think of it as a division of the "bundle of rights" that are attached to property, in a way that retains a clear hierarchy of interests and concerns - property owner > concurrent lessee/landlord > residential tenant/occupier. Rights that are tied to a residential tenancy agreement are not affected by a concurrent lease, and this is what the Minister is getting at when he suggests "tenants' lease length and lease conditions will remain the same".

Strictly speaking, the Land & Housing Corporation (the Public Housing landlord) has been setting up concurrent leases all over the place, as it has already transferred the management of around 28,000 Public Housing properties to Community Housing landlords since about 2008. But it's not been done in such a clear-cut way before. In the past, tenants have been asked to rip up their residential tenancy agreements with the Land & Housing Corporation, and enter into a new one - perhaps with new, less favourable terms - with the Community Housing landlord.

Concurrent leases may take some of the sting out of the coming property transfer scheme, but that's not the end of the story. Different Social Housing landlords apply different tenancy management policies and, while it is true that the existing terms of a tenant's residential tenancy agreement should remain intact, this application of different policies might make for some startling changes to tenants' experiences. For instance, Community Housing landlords set their rent in a way that requires tenants to claim Commonwealth Rent Assistance, but the Land & Housing Corporation does not. On paper, this will look like a hefty rent increase. In practise, tenants will have to pay 100% of their Rent Assistance to their Community Housing landlord. This is what the Minister is getting at when he says "their income after rent will remain the same".

To add another layer of complexity to our understanding, but perhaps a simplification to the system itself, the Housing Legislation Amendment Bill 2016 will provide that, as a matter of law, Public Housing that is transferred over to Community Housing by way of a concurrent lease will no longer be considered Public Housing. We'll add that to our list of things to write about...

But what of the second thing - "the registration of, and provision of assistance to, community housing providers that cannot be registered under the Community Housing Providers National Law (NSW)"? We won't go into in too much detail on this today, because we've already taken up enough of your time. But as we understand it, it is designed to solve a problem for Local Aboriginal Land Councils who run Social Housing schemes, and who want to register as an Aboriginal Community Housing Provider with the Aboriginal Housing Office. Currently they're unable to. As statutorily constituted bodies who own their own properties they cannot meet the conditions of registration, which would require them to transfer their properties to another registered provider in the event of winding up.

The Housing Legislation Amendment Bill 2016 would solve this issue by requiring the Social Housing Minister to establish a "local system of registration" that would mirror the national system as much as is possible. In other words, the Minister must create a whole new registration system that looks a lot like the existing one, but leaving aside one or two things that prevent some current Social Housing landlords from becoming registered. The trick will be to ensure the "one or two things" doesn't become too broad, giving potential new entrants a sneaky back-door into the Social Housing system and undermining the integrity of the existing registration scheme.

We'll be watching all of this closely as the bill makes its way through the Houses of Parliament.