Briefing: Tenant Involvement and Cashback

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1 6 August 2013 Briefing: Tenant Involvement and Cashback Tenant Involvement and Empowerment Standard Summary of key points: The Tenant Involvement and Empowerment Standard in the Regulatory Framework for Social Housing 2012 requires registered providers to offer tenants 'opportunities to be involved in... the management of repair and maintenance services, such as the commissioning and undertaking a range of repair tasks as agreed with landlords and sharing in savings made'. Each provider needs to consider what opportunities it can offer tenants for such involvement and how any savings might be shared but they are not specifically required to offer Tenant Cashback under this Standard. The Tenant Cashback pilots have been reviewed to identify the approaches used and the issues that need to be considered. Other Government promoted tenant involvement schemes have been summarised.

2 1. Regulatory Framework 2012: Tenant Involvement and Empowerment Standard The Tenant Involvement and Empowerment standard requires registered providers to offer tenants 'opportunities to be involved in... the management of repair and maintenance services, such as the commissioning and undertaking a range of repair tasks as agreed with landlords and sharing in savings made'. Grant Shapps, then Housing Minister, wrote to all Chief Executives on 19 April 2012 about Tenant Cashback and the new standards. He explained that this Standard requires social landlords to offer tenants opportunities to be involved in the management of repairs and maintenance, and to share savings made. His letter clarifies that there is a great deal of freedom within the new standards for landlords to design schemes, in consultation with their tenants, to meet local needs. Such schemes could focus on individual tenants but could provide opportunities for neighbourhoods to take on shared responsibilities and invest savings in community projects. Consequently, it is up to each provider to consider what opportunities it can offer tenants for such involvement and how any savings might be shared but they are not specifically required to offer "tenant cashback" as originally outlined by the minister. 2. Tenant Cashback pilots When the Minister announced the idea of tenant cashback in 2011, three associations expressed a willingness to set up pilots to examine the scheme but only Home Group and Together Housing in the end were able to run pilots. Bromford Group separately set up their own cashback pilot. However, none of the pilots have been designed along the lines originally announced and most use an inspection regime at beginning and end of the period with a reward if the repairs service is not used. There has been modest interest and take up from tenants. Details of these pilots are summarised below: Home Group ran a Customer Reward scheme in three areas of the country (North East, Essex and Cumbria) in partnership with B&Q. Different models were tested in each area with gift vouchers or rent-free holidays. There is a defined list of repairs that tenants can do under the scheme, with training and advice offered to tenants by B&Q. If Home Group has to carry out any of the listed repairs the tenant can no longer participate and receives no reward. Home Group s Insurers accepted the repairs covered by the scheme and the provisions made to address health and safety and mitigate risks. Over 130 tenants participated (20-30% of those invited but less than expected given the generous incentives).

3 Home Group s assessment at the end of the pilot identified that the number of minor repairs reported had been reduced by about 40%, confirmed over 85% satisfied with the scheme and participants welcomed the opportunity to do minor repairs themselves for some reward. Following their pilot schemes Home Group launched a new customer reward scheme in September 2012 Love my home. It is designed for tenants that pay rent on time, look after their home, give access for gas safety checks and contribute to the community by being a good neighbour. This scheme does not offer a direct financial incentive but there are other incentives and eligible tenants are entered into monthly prize draws. Together Housing, in their pilot, adopted wider objectives, as part of their approach to community regeneration. Their aim was to empower residents and to enable them to develop transferable skills, such as improving their CV, as a pathway to employment. They also wanted to reduce neighbourhood management costs, tackle property damage and improve the appearance of estates. They selected three areas for the pilot and phased its introduction, rewarding positive tenant behaviour and offering rewards for tenants not using the repairs service. There was a final reward for those who stayed in the scheme till the end and had signed up for basic DIY training. The scheme had limited take up, with expressions of interest from less than 200 tenants of 2000 consulted (1%) and far fewer signing up for the scheme. Together had to negotiate issues with their insurer before they could launch the pilot. The scheme has produced tangible improvements to participants homes and has increased the range of transferrable skills tenants have, with participants recording their learning to develop their CV. Bromford Group set up a Home Rewards Club that ran in four different areas in West Midlands. It offered two 6-monthly rewards ( 150 each) for tenants carrying out low level day to day repairs but tenants were not allowed to carry out external repairs, to work at height or with gas, electricity, asbestos or to do emergency repairs. They also offered a 200 reward in relation to housing management. Reasonable interest was shown with about 140 tenants participating. Their scheme demonstrated a significant reduction in the number of day-to-day repairs and has enabled Bromford to access nearly 100% homes (compared with 30% typically) for annual property survey and gas servicing. 2.1 Pilots: a housing association s considerations Irwell Valley carried out a review all tenant cashback options being proposed and assessed the evidence from the pilots so that they could compare it with their current practice to involve tenants and to share any savings with them as required under the Regulatory Framework. Their analysis confirmed that none of the tenant cashback options would generate any savings that could be shared with tenants and that all options would increase their operating costs. Their review also identified other risks, such as health and safety (both for tenants and contractors) and insurance restrictions. The pilots had reported very low tenant interest and Irwell Valley

4 has not received demand from tenants to carry out repairs themselves or to learn how to do so. They concluded that their current ways of involving and rewarding tenants offered better value for money. 3. Tenant involvement: issues to consider Insurance and legal requirements these limit the types of repairs tenants can carry out themselves. Associations need to ensure tenants who want to carry out their own repairs are trained and have contents insurance. These requirements prevented at least one pilot going ahead. Liability will require an assessment of the risk of contractors being injured when operating in homes maintained by tenants. There is at least one court case where contractor was injured working in a home after the tenant removed the stair balustrade. Health & Safety Associations need to ensure tenants understand the restrictions to the repairs they can carry out, such as working at height, work that is legally required to be carried out by competent persons (electrical work, gas and heating appliances), asbestos awareness. Types of repairs the tenant cashback pilots limited tenants to being able to carry out lowlevel general DIY repairs and maintenance, such as toilet fixtures and fittings, unblocking sinks. Tenants were not allowed to carry out repairs that contravened health and safety or the association s insurance requirements above. Existing contracts where the association employs external contractors to carry out their repairs and maintenance service, there would need to be an assessment as to whether any form of tenant cashback can be incorporated under the existing contract conditions. If the existing contract did not prohibit tenants carrying out repairs, then an assessment of what savings might be possible under the contract. For example savings would not be possible with contracts based on a fixed price/home or on fixed monthly payments. Rewards the pilots offered these in the form of vouchers or cash but any associations considering financial incentives would need to check the implications for tenants who are on benefits because any cash received could be viewed as income. 4. Other tenant involvement schemes 4.1 Tenant training and support programme The Government has launched a 1.2 million Tenant Training and Support Programme, run by the Tenant Participation Advisory Service, to give residents the skills they need to be more

5 closely involved with how their homes are managed. Tenants can be involved as individuals or by setting up a tenant panel or could take over some aspects of the management and maintenance of their homes and neighbourhoods themselves. 4.2 Community Cashback The Government s Community Cashback scheme is designed to reward and incentivise tenants who group together to manage small-scale local services and budgets in order to deliver better services and re-invest any savings back into the community. It is designed to build on existing opportunities under Local Management Agreements. There are safeguards since the total contract value of any Community Cashback agreement must be below EU competition regulations threshold and cannot last longer than 5 years. To safeguard public money and address potential public liabilities, tenant groups may need to incorporate (e.g. as an Industrial and Provident Society or Community Interest Company). Small grants of up to 3,000 are available to help tenants group to pay for those items that are essential to get the Community Cashback scheme up and running. This may include professional advice; training; communications costs; study visits; equipment and materials. In addition, support will be provided to landlords through an online Community Cashback Toolbox. Toolbox support includes model documents, training materials and advice on technical aspects of the project. Technical support is being provided by National Federation of Tenant Management Organisations (NFTMO), who are working in partnership with the Tenant Participation Advisory Service (TPAS) and the Tenant Central programme. 5. Conclusions and considerations The Tenant Involvement and Empowerment standard does not require a tenant cashback scheme but it does require registered providers to offer tenants 'opportunities to be involved in... the management of repair and maintenance services, such as the commissioning and undertaking a range of repair tasks as agreed with landlords and sharing in savings made'. Consequently, providers need to consider what opportunities they can offer tenants for such involvement and how any savings might be shared. While DCLG have not carried out any formal review, the three pilots have shown some improvements in minor repairs although the cost benefit of the schemes is unclear.

6 6. Further information Tenant Training and Support Programme contact TPAS ON or or visit Community Cashback contact NFTMO on or or visit or Tenant Central empowerment programme contact TPAS ON or or visit The National Housing Maintenance Forum (NHMF) and M3 have developed resources, such as the Repair Handbook, to help residents care for their homes and to report repairs accurately for more information. For more information visit

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