MYSPACE and the regulator

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  • #281485
    andrew_hodkinson
    Participant

    Hi all
    An early Christmas present from the regulator this morning -https://www.gov.uk/government/publications/regulatory-judgement-my-space-housing-solutions/current-regulatory-judgement-my-space-housing-solutions-19-december-2022

    We have 20+ appeals with the FTT (a range of decisions)

    Andrew

    #281486
    Alistair Costelloe
    Participant

    A G4/V4 is usually indicative that the RSH will appoint directors to take control of the association’s board, or commence action to de-register the provider – from the content of the judgement it appears that the non-compliance may result in a de-registration but the RSH seems to have been strangely unwilling to flex its muscles given the number of providers it has deemed non-compliant. Maybe it is sharpening its axe?

    On that note, the RSH’s decision to deregister Larch Housing after several years of non-compliance was upheld by the high court last week. The judgement makes interesting reading.

    https://www.bailii.org/ew/cases/EWHC/Admin/2022/3171.html

    #281488
    Terminator
    Participant

    Hi Andrew

    See earlier thread Home > Forums > Exempt and Temporary Accommodation > The making of a housing benefit millionaire

    The City of Bradford MDC continues not to pay MySpace, we have 2 appeal processes at FTT covering 27 appeals on the grounds that MySpace do not provide care, support or supervision, 9(1)(1) and in the alternative a rent restriction.

    I’ve been in contact with 2 other LA’s for a few months who are also at Tribunal with MySpace cases and we are working together to strengthen our cases. Happy to share info/evidence if you provide contact details.

    What I find particularly interesting in this new Judgement is MySpace confirm that that they have misclaimed that they provide Specialist Supported Accommodation and there are potentially 1800 cases this applies to. So if your an LA who accepted this from them I suggest you are entitled to revisit the rent you based HB on and any over overpayments created would be recoverable.

    David

    Home > Forums > Exempt and Temporary Accommodation > The making of a housing benefit millionaire

    #281491
    barryb
    Participant

    Can someone clarify something for me? How do the decisions of the regulator regarding My Space and Larch/National Community Homes affect the decisions we make regarding their exempt status and/or whether they are charging an unreasonably high rent?

    I understand that there are rules regarding how landlords can set their rents which can be affected by the regulator de-registering them as a social landlord and/or deciding that they don’t fulfil the criteria of providing Specialist Supported Accommodation.

    However, isn’t that separate from our decision as to whether the rent set is unreasonably high? I had assumed that it was bizarre but true that a landlord could in theory charge a rent too high for the Regulator’s liking but providing they could demonstrate how the rent was calculated (usually based on the long-lease model that I am sure we are all familiar with) we’d have a hard time arguing that the rent was unreasonably high compared to other landlords charging similar rent under the same business model.

    We have a few landlords charging very high rents who claim to provide Specialist Supported Accommodation and I guess they use that to justify the rents to the Regulator and/or LA. However, is there actually a register that we can look up to see if the landlord is actually recognised by the Regulator a fulfilling this criteria?

    So far i’ve kind of taken it on trust that they are if that is what they have declared, despite some doubts.

    Thanks

    Barry

    #281492
    Alistair Costelloe
    Participant

    A non compliant judgement has no direct effect on HB claims but may direct authorities to scrutinise the provider more thoroughly depending on the content of the judgement – I.e. Conflicts of interest, financial irregularities, failure to meet the criteria enabling an exception from the rent standard, or quality issues, all of which may have a bearing on whether the arrangements are contrived or whether services are being provided at a sufficient level to enable a scheme to be accepted as exempt.

    The Exempt Accommodation definition makes no reference to rent levels or compliance with regulatory criteria – these are separate matters covered elsewhere in the HB regs, or in separate legislation for the latter, namely the Housing and Regeneration Act 2008

    If a provider ceases to be an RP the decisions would need to be reviewed depending on whether the accommodation was accepted as exempt accommodation or whether the eligible rent was simply accepted as reasonable and not restricted because the landlord was an RP at the point of the claim. A decision to accept a claim as exempt wouldnt be affected by a de-registration decision, but would affect the authority’s subsidy claim, and the need to refer claims to the rent officer in connection with the subsidy claim. If an RP’s tenants HB claims for a rent exceeding the LHA were accepted on the basis of reasonableness, they would need to be checked against the exempt critieria at the point or deregistration, or the award restricted to the LHA.

    Unreasonably high rents are not directly related to whether the provider is registered or not – I dont believe that awards for exempt accommodation can be restricted on the grounds that the landlord isnt an RP, but its something that invariably gets done by refusing exempt status instead. Authorities have a few tools available to control rents, firstly by restricting rents to what they deem a reasonable level, or by doing as David has explained above and in the other thread, by advancing a contrivance argument, and paying no benefit at all until the case goes through tribunal – in my view a somewhat heavy handed approach but one which may be entirely justifiable depending on the level of engagement and co-operation from the provider and the quality, relevance and availability of evidence.

    There is very little interplay between the HB regs and the regulatory standards and registration criteria. There’s no record of registered providers that do provide SSH, but you can see from the regulatory judgements where the RSH has raised concerns and draw your own conclusions. In any case, authorities should satisfy themselves that a claim accepted as exempt continues to be exempt by periodically obtaining evidence to be able to uphold the initial decision.

    Ultimately, the accommodation either is or is not exempt, and the rent either is or not unreasonably high – these are decisions that the authority is at liberty to make in respect of a claim, and the claimant is at liberty to appeal against.

    #281510
    Steadman
    Participant

    Hi David, I currently have 10 MySpace cases about to go to FTT very soon. we have restricted as ‘Unreasonably High’ and used comparisons. I would be very interested in any tips or advice you could give.

    Paul

    #281529
    Terminator
    Participant

    Hi Paul

    You can contact me on david.carre@bradford.gov.uk

    I’ll provide what I can to help you.

    MySpace refused to provide evidence to us that they provide SSA so in the end we went to FTT under reg 86, that set of appeals has been with FTT for 2 years and the Tribunal is now looking at if they provides CSS for each tenant and we still retain appeal rights under 86.

    Another batch went under 9(1(l) which has 1300 pages of evidence we believe shows an abuse of the scheme between MySpace and their preferred provider of accommodation so we were quite pleased to see that link in the recent judgement

    First 9(1)(l) case for a LL in this sector we’ve done for 10 years and looking at the evidence it is totally justified.

    We chucked in a rent restriction as well just for the laugh:)

    David.

    #281758
    andrew_hodkinson
    Participant
    #281760
    Terminator
    Participant

    I think direction 3 will be interesting for those LAs who have paid them. I refer to my previous post suggesting recalculations of rent and potential OPs which if created on any large scale will probably bring Myspace down.

    At this stage I’d like to refer folk to a fairly new RSL called Lily Rose. Andrew above introduced them to me and I’m aware that they are now in West Yorks and in other areas potentially offering to take over Myspace properties. If this happens you may be wise to check out their website and identify that one of the Trustees is Michael Conlon who has strong links to MySpace and Enabling Homes.

    #281819
    MarinaJeppo
    Participant

    The latest accounts available on the Charities Commission website, they no longer show the £6 million in donations that were previously being used for funding the care/support/supervision. How are My Space now funding the CSS? Looking at the accounts available, it is apparent why the downgrading and enforcement has occurred.

    #281872
    Terminator
    Participant

    Historically charitable donations have always been shown as zero on the Charity Commission Website which appears to contradict the accounts which have always shown donations from leaseholders/stakeholders to fund CSS. I see new accounts should be available on companies house shortly so it will be interesting if in the same format as recent years.

    With regard to your observation re the funding of CSS Marina. At FTT in a few weeks I’ll be arguing CSS isn’t provided and they only provide IHM and if the Tribunal accepts they do provide CSS it’s funded by the IHM charge.

    Anyone had their “we don’t provide SSH accommodation” letters yet ?

    #281964
    MarinaJeppo
    Participant

    The latest accounts are available on the Charities Commission, there is £618,603 shown as ‘other income’ but I couldn’t see any reference to the funding provision of CSS (outlined on previous accounts). It is a lengthy document, I’m unable to add the link.
    We have received an email this week outlining no SSH, as My Space are active in our LA.

    We did historically attend a Tribunal over CSS charges with My Space but lost, due to a new set of accounts being produced at the hearing. The accounts also had circa £998,666 donations that was used specifically for furniture provision, but we were informed that none of the furniture donation funding were used for any properties in our area. We do remove furniture charges after 104 weeks. We had tried to argue the same as you are proposing Terminator, that we believed the CSS costs were part of the unreasonably high IHM cost.

    #282078
    liffe
    Participant

    Just out of interest MarinaJeppo – why do you remove furniture charges after 104 weeks?

    #282368
    Terminator
    Participant

    The year ending Oct 2021 accounts are now available on Companies House. They appear to be claiming a bit of a fall out with Enabling Homes who have stopped making their donations due to the Panorama program in the year before the program ???
    Anyway it does raise interesting questions of how any CSS is now funded given it was all supposedly funded by developer/leasehold donations which based the accounts equate to under £1.50 per week.
    The accounts are well worth a detailed read as they show the impact of the Regulators investigation and the extent of influence Mr O’Rourke appears to have had over My Space. Most Directors now having resigned including some due to specific links to O’Rourke and Enabling Homes.

    #283233
    MarinaJeppo
    Participant

    Sorry for the late reply – its due to them being charged for and repaid over this period. Unless a further invoice is provided for replacement items etc. is it normal to end the furniture costs as they’ve been paid in full (recouped). A restriction is added and we would expect the Landlord to amend their rent charges accordingly. We will always allow if further proof provided, and as long as the tenant does not take the furniture at the end of the tenancy.

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