Friday, August 26, 2016

Bonds for public housing?

The notion of rental bonds for public housing tenancies has been floating around for years. Government Ministers who take responsibility for the Land & Housing Corporation - the legal entity that actually owns all the public housing in New South Wales - are forever looking into the idea of taking and holding large sums of tenants' money, to retain in the event of a cleaning or repairs bill at the end of a tenancy, to see whether it would give them access to money that they can't otherwise recover from tenants of limited means. Usually, they conclude the cost of running such a scheme would outweigh any benefit it could produce for the Government landlord.

Public housing tenants are already liable for the negligent or intentional damage they cause during their tenancy, just like every other tenant in New South Wales. But, unlike every other tenant in New South Wales, they are also legally required to enter into and make good on agreements to pay their debts to social housing landlords. Throwing a bond into the mix won't really add much that isn't already being achieved, but it will add a whole lot of new work for whoever has to take, hold and refund all of that money. Then there is the financial imposition it would place upon all public housing tenants - necessarily on low incomes, as a condition of eligibility - rather than just those who do cause damage to their property during a tenancy.

The latest iteration of this idea seems to have taken a different turn. In one of his first media engagements as Social Housing Minister, Brad Hazzard said “[A bond] reinforces the message that if you do something bad to this property that you don’t own, you will lose some money to fix it.” Then, in the Future Directions for Social Housing document released in January this year, it was announced that FACS Housing would:
Introduce public housing rental bonds for all new tenants through an approach that mirrors the private market rent bond scheme, reinforcing tenant responsibility in regard to rent arrears and tenant damage, as well as helping to prepare them for transition to the private rental market. To commence during the second half of 2016, the bonds will be applied to new leases and will be equivalent to four weeks market rent, capped at $1,400. Tenants will be able to pay the bond in installments over two years, which will be administered by the Rental Bond Board.
In shifting away from a cost recovery strategy to one of encouraging tenant responsibility and capacity building, it seems that Government may have decided to push ahead with a public housing bonds scheme after all, even if it comes at a new cost to taxpayers.

There's a strong likelihood that it will come at a cost to public housing tenants, too, even after putting aside the difficulties most tenants living well below the poverty line would face in paying fortnightly instalments for two long years. A quick investigation of how well the Land & Housing Corporation handles "tenant damage" matters reveals a couple of systemic problems they will need to address, if their scheme's objectives are not to be doomed from the start.

The first is that they are notoriously bad at completing ingoing condition reports. As this 2008 article from Robert Mowbray shows, the problem is a long standing one. There are recent examples, too, indicating this problem hasn't yet been addressed. Examples such as the tenant who signed up for a new tenancy late last year and still hasn't received a condition report. Apparently the local FACS staff have said they'd just like to add a few things to it before they hand if over. Then there's the tenant who recently moved from one property to another, whose new condition report notes a "clean, undamaged and working" exhaust fan in the kitchen - except that there isn't one... And what about the time FACS staff referred to a condition report that was compiled many years before the tenant they were trying to recover damages from had even signed a residential tenancy agreement and moved into the property? Before a Tribunal, no less!

But even where ingoing condition reports are compiled, whether poorly or otherwise, they seem to have far less importance placed upon them than an outgoing inspection. According to one Tenants' Advocate, “we constantly see ingoing condition reports prepared by FACS Housing that have little or no detail in them and no photos. Every single item is recorded as clean, undamaged and working. Yet the outgoing report is always extremely detailed with photos and every single item is recorded as not clean, damaged and not working.”

The second issue flows from the first. Without a reliable condition report, tenancy managers are unable to establish what, if anything, the tenant should actually be held liable for. To get around this, it seems a common practice has arisen whereby the entire bill for bringing a property back up to re-lettable standard is passed on to the tenant. Sure, there will be times when this includes some cleaning and repair costs that a tenant is liable for, but it can push a bill that a tenant is only partially liable for into the stratosphere. As one Tenants' Advocate was informed by local FACS workers when questioning such a bill - "this is standard procedure".

The Brown Couch knows of a situation where a "tenant damage" bill exceeding $7,000.00 was more than cut in half when a Tenants' Advocate became involved, questioning a number of costs that were clearly not the tenant's responsibility. These included replacing worn-out kitchen appliances that the tenant had been making do with for some time, and the cost of restoring parts of the property that had been vandalised after the tenant had vacated. In that case, it also included some costs that the tenant agreed they were liable for, and was happy to pay. But that is not always so.

The Land & Housing Corporation also raises debts in situations where they shouldn't, such as against a former tenant who had been escorted from her property after an extreme domestic violence incident. The property had been trashed after she'd left, and FACS staff were well aware of this. They noted on her file that she should not be charged for the damage, but a debt was raised nevertheless. Even after discovering their mistake it took a very long time for the debt to be waived after it had been raised in the system.

In yet another example, a bill of several thousand dollars was reduced during conciliation in the Tribunal, because FACS staff knew they were trying to charge the tenant for things she wasn't responsible for. Then the tenant reminded the FACS' representative that her rent was in advance and she was entitled to a refund. When all was said and done the Land & Housing Corporation actually owed the tenant about $90.00. That's something that should have been picked up well and truly before making a Tribunal application, and it shows the work the Land & Housing Corporation has before it if it wants a rental bond scheme to be seen as anything other than a way of harvesting tenants' money more easily.

You'll forgive us if we seem to be going on about this a bit, but it really can't be stressed enough. Tenants should not be asked to embrace a scheme that is designed to encourage personal responsibility and capacity building unless the system within which it is to operate is responsible, and has the capacity to deliver on its undertakings. When it comes to the Land & Housing Corporation's approach to "tenant damage" and related debt recovery, no such system exists. If we are ever to see such a system, the necessary reform to policy and practice will not come from placing new expectations upon tenants, but on the landlord.

There are many reasons why bonds for public housing tenancies are a bad idea. Even if we ignore them all, the introduction of a bonds scheme would be premature. The public housing landlord needs to get its own house in order first.

Thursday, August 25, 2016

The Housing Department with no housing?

Robert Mowbray, the Older Tenants Project Officer at the Tenants Union, remembers a community work text from his social work studies in the early 1970s. It had the quirky title The Householder's Guide to Community Defence Against Bureaucratic Aggression. The author was Antony Jay, who went on to fame with his Yes, Minister series. With great sadness, the Institute of Tenancy Culture Studies notes his passing - his obituary in the SMH is worth a read.

Remember the episode called 'The Compassionate Society'? It was about a most efficient hospital. It was the one with no patients! Well, Antony Jay would not be surprised that in New South Wales we will soon have the most efficient Housing Department ... the one with no housing stock, as Housing NSW proceeds to divest itself of its stock. Stranger, indeed, than fiction.
This is one of the objectives of the Communities Plus initiative. A third of NSW public housing will be transferred to non-government organisations over four years, in tranches of about 1000 homes. This was reported here.
Antony Jay was responsible for such gems as 'A basic rule of government, minister, is never set up an inquiry unless you know in advance what its findings will be ...'.
He also developed an interest in public choice theory: 'In economics public choice theory assumes that all economic actors – businessmen, consumers, politicians and bureaucrats – are motivated primarily by individual gain. Thus, politicians pursue re-election and bureaucrats pursue budget-maximisation, while voters and interest groups chase free lunches. The trick is to know your enemy and exploit his self-interest to your own advantage'. Read more here.

Monday, August 22, 2016

New strata rules and you

Starting 30 November 2016, there will be some significant changes to the laws affecting tenants living in strata blocks. That's actually a lot of us - more than half of all people living in strata in NSW are tenants.
You can read more about the changes here, but what are the big changes that will be of particular interest to tenants? As is often the case with legislative reform, it's a mixed bag. Here are the ups and downs of four big changes which will affect tenants.

Considering the futility of life without strong tenancy rights
The model by laws will now be much more pet friendly. The default position will be that pets are allowed so long as the pet owner is responsible for the animal.
This is only the default for new by-laws. Existing strata schemes will need to vote to adopt the change, and even new strata schemes can choose not to use it - and maintain an anti-pet stance.
Of course no matter what the strata scheme decides, currently your landlord still has the ability to put a no-pets clause in a residential tenancy agreement. There is still a long way to go before tenants might make grown-up decisions about pets for themselves.

Hang me out to dry, you wrung me out, too too too many times
Good news - hanging your washing up on your balcony will no longer be a breach of the by laws, so long as it's not hanging over the balcony railings. Again, this only applies to strata schemes which adopt the new by laws.

Over occupancy
We won't take up too much room!
One of the interesting changes is the ability for strata schemes to limit the number of people who can live in the premises to no more than two adults per bedroom.
By extension, tenants will have clearer protections against strata schemes arbitrarily deciding to cancel key cards with the introduction of this by law removing one of the dodgy reasons some strata schemes have used to lock tenants out of their homes.
It's important to remember that vulnerable tenants who are being forced into overcrowded accommodation may not actually have much of a choice in these matters. That's not to say strata should allow overcrowding, but it is important that it is the exploitative landlord who is penalised by their breach rather than their vulnerable sub tenants. It is not clear in the new law that this will always be the case.

Tenant representation
Whiskers thought he was fitting in well
at his first strata committee meeting
There are two aspects of the new legislation that let tenants have something of a say in their strata community. Any tenant will be entitled to attend any meeting of the owners corporation (except during discussions of financial matters), though they won't be allowed to speak or vote.
In strata schemes where more than 50% of the lots have tenants, the tenants will be able to elect a tenant to represent who can speak, but not vote, on their behalf. How effective this will be at ensuring the majority of the strata community is heard remains to be seen.

Wednesday, August 17, 2016

Happy anniversary, Tenants' Union of NSW

The very first meeting of the Tenants' Union of NSW was held 40 years ago today, on August 17th 1976. We are now 40 years strong.

Past and present staff and board members of the Tenants' Union,
celebrating 40 years of advocacy
We've been building up to this milestone all year. We launched our celebrations with a BBQ at Northcott Towers, sharing food and cake with good friends and colleagues. We've shared 40 moments from our organisation and our network's history, reflecting on the great work of tenants' advocates past and present. And we've compiled a 40th anniversary bumper edition of the Tenants' News.

On Monday we threw a bit of a birthday bash, including a half-day forum on the future of tenants' rights. We've already shared some of the best bits on Facebook, and we'll be adding a few more over the next couple of days.

Oh, and we've produced a half-hour movie that tells our story. We're really quite proud of it - we'd love for you to check it out.

Happy anniversary, Tenants Union of NSW!

Thursday, August 11, 2016

Taking action for access to justice - an update on NCAT fees

A few weeks ago the NSW Civil and Administrative Tribunal fee structure for pensioners changed substantially with the result that basic application fee more than doubled for many tenants. We wrote previously about it here. Every dollar counts for pensioners and other concession card holders and we're worried that this increase in fees will create a barrier for vulnerable and disadvantaged tenants to lodging an application.

The change introduced a new method of calculation for concession fees, setting them as a percentage of the full fee.  This resulted in a significant increase in the standard fee this time around, but also means that whenever full fees increase, fees for pensioners will also increase at the same time.  Pensions don't generally increase at the same rate or frequency as average household incomes, so any future fee increases will be felt more sharply by pensioners.   

There's now a chance this change, which came without consultation, may be reversed by parliament. Greens Member of the Legislative Council, Jan Barham, has moved to disallow the new fee structure.

When this motion comes up for debate in parliament in a month or so's time, the cross bench Members of the Legislative Council will have the ability to support the motion, and push for the cost of NCAT applications for pensioners to revert to $5.

Now is a great time to get in touch with these MLC's to let them know about the potential impact of these changes on access to justice for vulnerable tenants. We've written a sample letter that you can personalise and adapt.  The most effective letters are those that are personal and passionate. You might want to talk about how this change could affect you or others you know, or mention that in other states, like the ACT and Victoria, the application fee is set at $0 for pensioners.

If you'd like to get in touch, here are the cross benchers details:
Animal Justice Party
Mark Pearson
Phone (02) 9230 2445
Fax (02) 9230 2599 

Christian Democratic Party
Paul Green
Phone (02) 9230 3484
Fax (02) 9230 2342

Fred Nile
Phone (02) 9230 2478
Fax (02) 9230 2098

Shooters, Fishers and Farmers Party
Robert Borsak
Phone (02) 9230 2850
Fax (02) 9230 2613

Robert Brown
Phone (02) 9230 3059
Fax (02) 9230 2613

Tuesday, August 2, 2016

Sydney's stone, cold heart

We're saddened by the weekend's news that Sydney's iconic Sirius Building will not be listed on the NSW Heritage Register, despite the unanimous recommendation of the Heritage Council of NSW back in February.

Minister for Environment and Heritage, Mr Mark Speakman, announced on Sunday that he would not list the site on the Heritage Register, as to do so would reduce its resale value and deprive the State - or perhaps more specifically, pockets of Sydney's west - of money to build more social housing. This is despite the higher than anticipated earnings from the sale of other properties around Millers Point, and the remaining properties that would see in excess of $880million brought in if prices continue at current trends.

Minister Speakman says:
I am not listing it because whatever its heritage value, even at its highest that value is greatly outweighed by what would be a huge loss of extra funds from the sale of the site, funds the government intends to use to build social housing for families in great need.
This is a slap in the face for the community of public housing tenants who have made their homes in the purpose-built Sirius Building, which is part of what has given it its Heritage value in the first place. And it's a huge blow to the remaining tenants of Millers Point who still look to Sirius with hope that it could hold what's left of their community together.

It also raises that nagging question about social mix in New South Wales - why do we fall all over ourselves to open up "welfare dependent" communities of public housing in Sydney's western suburbs, by handing it over to private interests for "renewal", while clearing low-income tenants out of those parts of Sydney we'd rather just flog to the highest bidder? It's not like they couldn't benefit from a bit of social and economic diversity in those parts themselves. No, scratch that. It's not like they haven't benefited, with Millers Point recently finding its way into the top-ten of a "liveability index" for Sydney's suburbs, on account of its "rich history and culture". Although how you can define a suburb as "liveable" while most of its long-term residents are in the process of being shipped out by a cash-strapped landlord is perhaps a matter for debate.

As for Sirius, we'll always regard it as part of what makes Sydney great. The lives, the characters, the community that is attached to that building must never be forgotten, even if they are to be lost. True, the Government hasn't quite sold it yet, and there's still time for them to reconsider their plans. But the decision not to list it on the Heritage Register is as clear an indication as you'll get that they would allow all this to be destroyed.

So who will buy it? What will they do? There are calls for a new Green Ban to be imposed on the site, again reflecting part of its very history that gives it Heritage value. We'd like to see that, if such a thing is possible in this day and age. Because even if you leave the question of heritage aside altogether, the day the Sirius Building comes down is the day Sydney's loses its heart.