Friday, September 13, 2013

UK v NSW: across the seas, we've boundless rooms to spare...

You might have noticed the UK's new 'under-occupancy rules' (coined the 'spare bedroom tax' by the Labour Party in opposition) have attracted the attention of the United Nations' Special Rapporteur on adequate housing, Ms Raquel Rolnik.

Ms Rolnik has recently visited the UK to investigate the situation there, and if recent reports are much to go by, she hasn't been impressed with what she's found. Then again, the designers and supporters of those rules aren't terribly taken with what she's had to say either.

A quick search of your favourite UK based news sites will give you hours and hours of reading material on the topic. We don't propose to comment on that story, because we're no experts on tenancy law and policy in the UK. But it does prompt a quick review of the UK's under-occupancy measures, so that we may compare them to what's currently being loosed upon New South Wales in the form of the 'vacant bedroom charge'.

We should note, and be very clear, that our understanding of the UK 'spare bedroom tax' is limited. We can read the same news articles, press releases and fact sheets as anyone, and that's exactly what we've done here. We do not profess to be across the situation in the UK.

But we have had a good look at the information provided by the UK housing and homelessness advocacy group Shelter, among a couple of other things. We reckon we've got enough to go on to be able to spot a few key differences between what's happening there, and what has just been written into policy in New South Wales.

With this in mind, let's take a look at some key similarities and differences between each of these responses to 'under-occupancy':

What's the same?

Each scheme will result in higher costs for tenants that are caught by it, through a reduction in a benefit to those affected. In the UK, that is a reduction in a targeted welfare payment known as the 'housing benefit'. In NSW it is a reduction in the rental rebate or subsidy that results in a reduced rent for low income tenants in social housing.

In other words, affected UK tenants will get less in their pockets, but will have to pay the same rent, and in NSW those affected will get the same in their pockets, but will have to pay more rent. The net effect will be the same - affected tenants will have less in their pockets once the rent is paid. Tenants who are faced with the charge will be worse off financially, unless they move from their homes, resulting in either a financial cost or a social cost.

What's not the same?

1. In the UK, every under-occupant in social housing is affected, while in NSW only under-occupants in public housing will be asked to pay more if they:

a) refuse to consider offers of alternative housing, in a general sense; or
b) refuse to accept one of two specific offers of alternative housing once they've agreed to consider offers in general.

In a way, every over-occupant is affected in NSW because they will all be asked to make this choice. In the UK there is no choice - the only way to avoid the payment is to not be an under-occupant.

2. The manner in which a tenant might move from a situation of under-occupation to some kind of form-fit-occupation (or whatever the term might be...) is quite different in the UK, as there is no single waiting list for transfer applicants. Each housing provider may have a different way of going about managing transfers - for example they might apply different guidelines as to how and when a transfer will be approved, and at what level of priority a new property will be allocated (see the Shelter UK website again for more information). But - in either case - that's before we even start to consider the likely availability of form-fit properties for under-occupants to move into.

3. In the UK, the adjustment to the housing benefit is applied based on the number of spare bedrooms - it's a loss of 14% for one spare bedroom, or 25% for two or more. In NSW, the subsidy adjustment is applied depending on the under-occupant household composition - singles will pay around $20 per week more, while households of two or more occupants over the age of 16 will pay $30 per week, regardless of how many spare rooms each household may have to which they are 'unentitled'.

4. In the UK, the bedroom 'entitlement' appears to be affected by these new rules. Tenants stand to lose the benefit if there is at least one spare bedroom in their house. In NSW, the charge is applied based on your 'required number of bedrooms', which is set out in the eligibility and allocations policy. This means that a household might have a spare bedroom that they will not be charged for, but two spare bedrooms will generally always attract the charge.

So, where does that leave us?
We can see from that quick overview that tenants in New South Wales will not be as immediately or severely impacted by our under-occupancy measures, as those experienced by our counterparts in the United Kingdom. Limited though this is, we might even convince ourselves that public housing tenants in New South Wales will at least be offered something of a choice. The option of relocation is available, if only in theory, for tenants who would prefer to pay the same for less.

But let's not let ourselves off the hook that easily. The simple fact is that for the time being, tenants will be able to avoid the vacant bedroom charge by agreeing to consider offers. This will be an effective cost saving measure for tenants, at least until those offers do start coming through. But sooner or later, for one tenant after another, those offers will start to materialise. The choice to be made will come into crisp focus, for one tenant after another...

Will you allow yourself to sink further into poverty, or will you move away?

We've just had a federal election that was largely fought and won on a 'cost of living' platform. If you want to find out what real cost of living pressure is, head out into the towns and suburbs of New South Wales, and talk to low-income tenants in public housing. Ask them how they're planning to meet a $20 per week rise in the cost of living.

To add to the frustration, Housing NSW says they'd rather have your spare room than your extra $20 per week. It's a real shame that they haven't worked out a scheme that actually rewards tenants who want to move to a smaller property, rather than penalise those who can't afford to stay where they are.


  1. On asking a local housing NSW office --I asked if I accept to down size--and I am on a pension --will there be any support $$ wise to help me move--etc I have insatalled air con in the house I am living -- a split system and I also asked if they would subsidise or help me re--in stall it if I had it removed ---- I was politely told no financial help will be given to people down sizing ---- Also was told to stop any form of improving my property---was goin to repaint internally and carpets in the future----as the officer said no guarrentes don't waste your money ;;;

    1. We're not sure about that, Anonymous. We have heard that some assistance will be given to tenants through the relocation process, and this could include transferring fixtures (where possible) and help with restoring modified premises to their original condition - particularly where modifications have been made to accommodate a tenant with disability.

      This will only apply where modifications have been made with the approval of HNSW. Obviously this will cause particular problems for people who have obtained such approval orally, rather than in writing.

      In any event, things could get pretty messy for anyone who is moving out of an established home. As with all things, keep your local Tenants Advice & Advocacy Service's phone number handy, and give them a call if you're not sure about an offer or a demand made by HNSW.


  2. Housing NSW do have a relocation policy so unless Ms. Goward has truly changed the policy the Department has no other option to pay moving and relocation costs and also to reimburse the tenant for improvements to the property.Advice don't volunteer to move let them instigate the relocation.
    Do not take advice from a telephone operator or a desk clerk......go higher. If all else fails go to Housing site online and look up policies relating to relocations or contact your local State MP (hope they are not in Mr. O'Farrell's shonky stable)!

    1. Our suggestion: contact your local TAAS before getting in touch with your local MP. At the very least, they can help you to decipher those policies...



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