Rent Payments and Arrears Recovery Policy

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1 Issue No: 2 Issue Date: 10 March 2008 Originator Title: Kevin Powe 1.0 Introduction Rent Payments and Arrears Recovery Policy 1.1 The effective operation of this policy is fundamental to our ability to achieve many of the Business Plan and Corporate Plan targets. 1.2 The application of this policy ensures compliance with the outcomes of the Framework for Social Housing in England introduced by the Tenant Services Authority as outlined below: Provide choices, information and communication that is appropriate to the diverse needs of their tenants in the delivery of all standards Treat all tenants with fairness and respect Demonstrate that they understand the different needs of their tenants, including in relation to the seven equality strands and tenants with additional support needs Registered providers shall charge rents in accordance with the objectives and framework set out in the Government s Direction to the TSA of November 2009 In meeting all TSA standards, including their local offers, registered providers shall have a comprehensive approach to managing their resources to provide cost-effective, efficient, quality services and homes to meet tenants and potential tenants needs Registered providers shall set out in an annual report for tenants how they are meeting these obligations and how they intend to meet them in future. The provider shall then meet commitments it has made to its tenants Registered providers shall manage their resources effectively to ensure their viability is maintained. 1.3 The policy compliments the associations Corporate Debt Policy and is underpinned by the principle of proportionality as identified within the Human Rights Act When dealing with debt owed by Former Tenants, the provisions of the Data Protection Act 1998 will be adhered to when providing information to our third party contractors. Where the association has failed to maintain contact with a for a period of 6 years or more the debt will be considered as "Statute Barred" under the conditions of the Limitations Act 1980.

2 Access and Communication OVH is committed to ensuring that our services are accessible to everyone. We will seek alternative methods of access and service delivery where barriers, perceived or real may exist, that may make it difficult for people to work for us or use our services. Equality, Diversity and Human Rights OVH is committed to ensuring that no person or group of persons will be treated less favourably than another person or group of persons and will carry out our duty with positive regard for the following core strands of equality; Age, Disability, Gender, Race, Transgender, Sexual Orientation and Religion and/or Belief. OVH also recognise that some people experience disadvantage due to their social economic circumstances, employment status, class, appearance, responsibility for dependants, unrelated criminal activities, being HIV positive or with AIDS, or any other matter which causes a person to be treated with injustice. OVH will also ensure that all services and actions are delivered within the context of current Human Rights legislation. Staff and others with whom we work, will adhere to the central principles of the Human Rights Act (1998). 2.0 Statement of Intent 2.1 Effective Income Management underpins our ability to meet many of the targets contained in the Business and Corporate Plans. The association will adopt a preventative approach towards the collection of rent and other service charges to safeguard the provision of services and will take prompt and proportionate recovery action when arrears occur. 2.2 The operation of this policy and all associated procedures will utilise the full range of recovery powers and options available within the prevailing Housing Legislation; however application of the policy will be subject to the conditions and restrictions imposed from relevant secondary legislation e.g. Human Rights Act 1998, Disability Discrimination Act 2002 and the relevant Equality and Diversity legislation. 2.3 It is recognised, however that our client group includes vulnerable clients. Subsequently this policy is compliant with the Housing Corporation regulatory code of guidance in combining the need to maximise rental income with the provision of advice and support. 3.0 Arrears prevention

3 3.1 Our preventative approach commences from the point the tenancy is accepted. Incoming tenants are advised of the range of payment options, their obligations to pay the rent and the potential consequences of not doing so. In addition we will assist tenants to maximise their income through early referral to our specialist Welfare Benefit Team and provision of Tenancy Support. This includes acting in an advocacy capacity within the Housing Benefit appeals process. 3.2 The association offers a wide range of flexible and accessible payment methods that are kept under review. We will adopt new payment methods where they are convenient for the tenant and economical for the association. 3.3 In order to maximise income and reduce rent arrears the association will make use of incentives for payment to encourage the maintenance of a clear rent account. We will fully evaluate the success of such activities. 3.4 The association will signpost tenants to external agencies, both local and national; to obtain independent advice if this is preferred. 3.5 The association will foster and maintain an effective relationship with the Local Authority Housing Benefit section via a formally negotiated Service Level Agreement (SLA) and through direct involvement in the Verification Framework. 3.6 The association will actively participate in benchmarking and regularly reviews of our operating methods to ensure relevant best practice is incorporated. The association will ensure that effective procedures are in place and these are regularly reviewed to ensure they are fit for purpose. 4.0 Current Rent Arrears Pursuance 4.1 The practice of making realistic arrangements, taking full account of the ability to pay, is considered vital to a proactive and effective debt recovery. 4.2 Early referral to support agencies is a key component of our approach and we have introduced a Tenancy Support service for tenants who are less able to manage their own tenancies. We will also provide specialist Welfare Benefit advice and assistance to help tenants maximise their income or make appropriate representation to the courts in respect of benefit entitlement. 4.3 All recovery actions will comply with the established Pre Court Protocol, which emphasises the need for personal contact with tenants throughout the debt recovery process.

4 4.4 In doing so the association will comply with schedule 2 of the Housing Act 1988 as amended by the Housing Act 1996 and in the case of persistent rent arrears will take court action to recover the debt and/or repossess the property; however eviction will always be considered to be a last resort measure. 5.0 Former Tenant Arrears Pursuance 5.1 We will ensure recovery action is proportionate to the level of debt and, in accordance with best practice, the maximum length of time a former tenant debt will be retained, with no action taken, will be two years from the end of the tenancy. 5.2 It is critical, however, for the efficient and effective recovery of Former Tenant Arrears pursuance for the association to have robust and clear procedures in place for writing off debt considered to be irrecoverable or uneconomical to pursue. 5.3 Subsequently a range of write off parameters, based on current best practice and Audit Commission Guidelines, have been established and incorporated into recovery procedures. The value range of each parameter will be kept under review and determined in consultation with the Director of Finance. 5.4 All recommendations for write off will be in accordance with the associations Financial Regulations and will be reported to Financial Resources Committee. 5.5 As a further proactive measure, recovery officers are empowered to negotiate up to a 50% discount of the debt subject to a one off payment of the balance. On confirmation of receipt of payment the remainder of the debt would be permanently written off as an incentive write off. 5.6 We will however retain the provision to write back any other debt not included in 5.5 above which was previously written off should the debtor make themselves known to the association. If the debtor contacts the association for rehousing then the provisions of the suspension policy for Choice Based lettings will apply. Each case will be considered individually under the criteria detailed within the suspension policy. 5.7 Where a tenant leaves a property and there is a credit on the account, a refund payment will be offered, subject to clearing any associated debt to the association. We will make reasonable attempts to contact the creditor, if this was not identified at tenancy termination stage; however, if the creditor has not established contact within a period of one year then the credit balance will be presented for write off. The write back provisions will apply, subject to the statute of limitations, should the tenant subsequently make contact. 6.0 Implementation

5 6.1 The association will manage the implementation of this policy via the Income Management and Finance Teams. 7.0 Publicity 7.1 We will actively promote our rent and debt recovery service in as many ways as is considered practical. These will include a number of different methods such as: Leaflets Service standards Newsletters Posters Information on the reverse of rent letters/statements Local Press Tenants/Leaseholder handbooks Web page 8.0 Consultation and Customer Involvement 8.1 Consultation will be via the associations established mechanisms for Resident and Customer Involvement. The opportunity for customers to shape and influence the Income Management Service will be promoted in various forums with performance monitored and reported in a variety of ways:- Newsletters Focus Groups Tenants Panel Area Forums Business Planning Group Board Reports Executive Management Team 8.2 Additional feedback will be encouraged and sought using telephone surveys and the annual satisfaction survey. 9.0 Responsibility 9.1 It is the responsibility of the Executive Management Team for effective implementation of this policy Review 10.1 We will ensure this policy remains current and is updated to take account of new legislation, relevant guidance and best practice with associated procedures reviewed on an annual basis.

6 10.2 Performance reports will be provided to the governing body and tenants in the annual report Scheme of Delegation 11.1 Responsible Committee - Board Formulation and monitoring of policy Formulation and monitoring of procedures Amendments to policy Monitoring of statutory requirements Implementation of policy - Board - EMT - Board - Board & EMT - EMT 12.0 Related Policies/Documents Income Management Service Standards Corporate Debt Policy Rent collection and arrears recovery procedures Former Tenant Recovery procedures Financial Regulations and Standing Orders Scheme of Delegation Choice Based Lettings/ Suspension Policy