Cllr Tatler on the 'perfect storm' facing Brent Council finances

 Cllr Tatler made no bones about it at Brent Scrutiny last night: Brent Council is facing a 'perfect storm' regarding its finances:

 

 

As already reported by Wembley Matters the combination of increased homelessness (150 families a week seeking help from Brent Council), inflation, rising interest rates, rising private sector rents and reduced private sector rental properties as a result of landlords exiting the market; combined has led to a £13m overspend by the Council.

The Resources and Public Realm Scrutiny Committee delved deeper into the repercussions and possible mitigations last night.  

One focus was the 600 plus empty properties that could easily house the 500 families and single people (858 people in all) currently in expensive bed and breakfast accommodation.  The challenge was how to contact the owners so that the Council could lease the property.  Some councillors there were more than 600 empty properties and asked how the  Council collected the figures. A councillor asked if this coudl be checked against the most recent census. In response Cllr Tatler said that the Council could reactivate the campaign to ask residents to report empty properties.

Contact Empty Property Team

Opening hours: Monday to Friday from 9am to 5pm

Phone: 020 8937 2384 option 1 then option 4

Email: empty.property@brent.gov.uk

 

There are also 600 empty council properties on the South Kilburn estate in blocks that are due to be knocked down. However, officers said many are not habitable and were needed for decanting.

There was a need to look at buying new properties and building on existing council land.  There was a corporate exercise across the Council to ensure it is not missing out on potential subsidies but subsidies were also reducing:

Extract from Officers' Report

The loss of subsidy cost is forecast to rise to £8.6m in 2023/24 (from £3.7m in 2022/23) as rents increase but the Local Housing Allowance  remains unchanged at its current level. Benefits paid to those living in Temporary Accomodation  is limited to 90% of the 2011 LHA rates which, particularly since the pandemic, is significantly less than rents being charged by most private sector landlords today. A percentage of the Housing Benefits subsidy received from DWP when compared to the total amount paid to residents is forecast to reduce by 14% when compared to the average over the last three years (67% versus a 81% average). 

Councillors also asked about loss of Business Rates with commercial properties left empty. Could the Council charge double if left empty for more than 2 years as with empty homes? They were told that was not currently within the Council's powers. Cllr Tatler said that 90% of Brent businesses are SMEs (small and medium enterprises) who had been badly hit and thus no longer viable. Chair Cllr Conneely agreed with Cllr Malloy that she would rather be asking profit-making businesses to pay more than hard-pressed residents.

Cllr Malloy said that he knew of a commercial property in South Kilburn where the big property company owner had smashed all the toilets so they they could claim the property was unusable and therefore not pay business rates. This resulted in an interesting exchange with Brent Council leader Muhammed Butt:

 

 

 Questioned about the possible use of reserves to help meet the deficit the Head of Finance said that Brent's reserves around the mid-way point for London Councils. Much was earmarked for projects and it was prudent to have reserves available for unexpected events such as a pandemic. However, there was a case for a review of use of reserves that were not earmarked. Cllr Tatler pointed out that if reserves were spent they would have to be rebuilt in subsequent years. More information on the status of reserves will be included in the Budget report in February.

 

The Head of Finance noted the cross-party  'Eastbourne letter' to the government published on Wembley Matters LINK from 119 council leaders about temporary accommodation costs. It was signed byu Muhammed Butt.

 

Recommendations:

 

1. Council to lobby government on business rates.

2. Council to have a clearer plan on effective collection of business rates.

3. Council to investigate use of census data to help identify empty properties.

4. Council to work on ways of turning empty properties into usable properties.

Information requests:

Detailed information of subsidy loss.

Data on voids.

List of empty properties if data legislation allows.

 

Council summit on 'stark' crisis in providing homeless safety net within current funding

I recently reported on the financial crisis facing Brent Council due to the rising number of homeless in the borough and the spiralling cost of temporary accommodation.  I have just received notice of this meeting which Brent councillors may be interested in attending.

Over 100 councils will attend an emergency summit taking place on Tuesday 31 October to discuss the escalating social and financial crisis created by the unprecedented demand for temporary accommodation.

 

Hosted by Eastbourne Borough Council and the District Councils’ Network, this summit aims to share insight from the councils attending and will result in a joint cross-party letter to the government ahead of the Autumn Statement urging immediate action.

 

Councillor Stephen Holt, Leader of Eastbourne Borough Council, said:

 

The situation is stark. 

 

Councils provide a safety net for the most vulnerable people who need our help, and that safety net is at real risk of failing. 

 

Figures from the Department of Levelling Up, Housing and Communities have shown that the cost of temporary accommodation to local authorities reached 1.7bn last year and is increasing rapidly. This is wholly unsustainable for councils, and the situation is now critical.

 

The summit will explore solutions from the government, including: 

 

• Increase Local Housing Allowance rates for private rented accommodation 
• Develop policy to stimulate retention and supply in the privately rented sector 
• Review the housing benefit subsidy rate for local authority homelessness placements 
• Give district councils the powers, funding, and resources needed to increase the supply of social housing
• Increase the level of Discretionary Housing Payment and Homelessness Prevention Grant

 

The Minister for Local Government, Lee Rowley, has been invited to attend the summit.

 

Councillor Hannah Dalton, the District Councils’ Network spokesperson for health, housing and hardship, said:

 

Across the country, we are experiencing a spiralling tide of need, driven by a severe shortage of social housing, the cost of living crisis, and an unstable and unaffordable private rented sector. This means as district councils, we are placing an unprecedented number of people in temporary accommodation, which is cripplingly expensive for councils and unsuitable for residents. 

 

Districts are vital to preventing homelessness and providing resolution when our residents are faced with no alternative. Without urgent intervention, the very existence of this safety net is under threat.

 

We are therefore calling on the government to act now and urgently adopt our five asks ahead of the Autumn Statement. While these alone will not end homelessness, they will go a long way in reducing the number of families in temporary accommodation and the series of challenges that come with this.

 

The summit will take place remotely on Tuesday 31st October from 9.30am to 11am.

 

Any council leaders, housing portfolio holders or senior council officers wishing to attend the summit should email laura.walsh@lewes-eastbourne.gov.uk.

'Cockney Benefit Tourist Invaders' jibe as Brent Council relocates families in Sandwell

Illustration used in the Halesowen News

Following Sandwell' Council's loss of a court case which over-ruled their attempt to withhold Council Tax benefit for two years from new residents who are families rehoused by Brent and other London boroughs in Sandwell, near Birmingham, Brent Council is again sending families to the city.

The Halesowen News LINK states:

In a memo entitled Out of Area Placement Notification seen by the News Brent Council warned Sandwell Council officers of its plans.

The memo said:

We are housing tenants again in the Sandwell Council area due to the change in the council tax status.

We will be housing clients in temporary accommodation and emergency hotel accommodation (mainly houses) with offers of two year tenancies.

The memo also revealed Brent Council would be advising Hammersmith and Fulham Council to do the same.

The story goes on:

Deputy council leader Councillor Steve Eling said:

Within just weeks of the court's judgement that deemed there was no evidence of people being relocated from London to Sandwell, a London borough has placed a family here and another has confirmed it will be dumping poor families in Sandwell, apparently taking advantage of cheaper rent here.

This is a direct result of the court's judgement in the case of Brent Council and would appear to apply equally to the others. As a result, we're powerless to stop this happening.

We believe some of these families don't want to come here either because it takes them away from family and friends.

This will create an added burden on Sandwell Council taxpayers who will now have to pick up 100 per cent of the bill for these extra families who can't afford to pay council tax - as well as potentially for families that London boroughs have already placed here.

That's why we introduced the two-year residency rule in the first place, to protect Sandwell taxpayers and Sandwell families who are most in need.

Following the court's judgement, we've had no choice but to suspend that policy. We'll now have to either make further cuts or ask everyone - including the most vulnerable and poorest people in the borough - to pay something towards their council tax bill.

Following the court's judgement, we now have a £1.6 million shortfall in the money to cover the cost of council tax discounts.

The stereotype in the illustration above may be ridiculous but such stereotyping of Brent families, already removed from friends and family, clearly presents a danger that they will encounter prejudice and resentment on arrival in Sandwell and the possibility that the children of 'invading' 'Cockney Benefit Tourists' will encounter bullying in school.

Thankfully the Halesowen News quotes the warmer words of another local councillor:

Councillor John Tipper said:

Whatever the finances of the matter is we have to remember these people who are coming into Sandwell are probably not coming by choice and are human beings who should not be demonised. I hope the people of Sandwell offer the hand of friendship to these newcomers.

Brent's housing crisis in figures

Shelter has issued the latest figures on housing need which are for the third quarter of 2013. Full data is available HERE

I have made a table for the main figures for Brent below:

London Borough of Brent	Quarter 3 2013	Quarter 2 2013
Families with children accepted as homeless	72	40
Households accepted as homeless	155	113
Households found to be homeless but not in priority need	63	33
Households found to be ‘intentionally homeless’	12	18
Households in temporary accommodation	3,410	3,484
Number of children in temporary accommodation	5,729	5,837
Households with dependent children in temporary accommodation	2,640	2,692
Possession claims issued by landlords	655	535
Possession claims by mortgage lenders	83	59