Local government law

Private sector renewal powers

Local authorities have powers contained in the Housing Grants Construction and Regeneration Act 1996, the Local Government Act 1989, the Housing Act 1985 and more general powers in section 2 of the Local Government Act 2000 to assist in the repair and improvement of privately owned homes.

However, since 18 July 2002, when the provisions of the Regulatory Reform (Housing Assistance) (England and Wales) Order 2002 came into force, authorities have had greater and more extensive specific powers to provide assistance.

The order is part of the government's aim of enabling local authorities to take a stronger and strategic view of local needs across all housing, whether private or public, and to encourage sustainable home ownership, set out in the housing Green Paper 'Quality and Choice: A Decent Home For All', the housing policy statement The Way Forward for Housing, and the consultation paper Private Sector Housing Renewal: Reform of the Housing Grants Construction and Regeneration Act 1996, Local Government and Housing Act 1989 and Housing Act 1985.

The order gives local authorities power to provide assistance to persons, directly or indirectly, to acquire, repair, adapt, improve or demolish living accommodation.

It repeals parts of the 1996 Act, with regard to the use of grants and the provisions under the 1985 Act relating to local housing authority loans on housing renewal.

It also streamlines the provisions of the Local Government and Housing Act 1989 relating to the declaration of renewal areas, and makes some amendments to the disabilities facilities grant scheme, leaving mostly unchanged the regime for mandatory disabilities facilities grant.

The repeals take effect on 17 July 2003, with the effect that authorities wishing to provide assistance to private home owners after that date will have to use the new powers to provide assistance.

However, authorities cannot use the new powers until after they have adopted a policy setting out details of how assistance is to be provided, given notice of the policy to the public, ensured that a copy of the policy is available for inspection and that a summary of the policy can be obtained by post.

Additionally, authorities must set out in writing the terms and conditions under which assistance is to be given.

Before any assistance is given, authorities must satisfy themselves that home owners have received appropriate advice or information about the extent and nature of any obligation they will be taking on.

And where, as a condition of the provision assistance, a person is required to make a contribution or repayment, the authority must have regard to the persons ability to make a contribution or repayment.

The government has also published, in June 2002, consultative housing renewal guidance (the final guidance is scheduled to be published in July), which provides guidance as to the extent of the new powers, and assists authorities in the formulation of policies.

The guidance provides a strategic context for the formulation of policies which includes aligning housing renewal policy with wider strategic objectives reflecting policies and strategies at national, regional and local level, for example, the national planning policy for housing, the Regional Development Agency and the community plan.

It also sets out guidance for working with local partners, identifying local issues, needs and expectations, and setting policy priorities for action, whether by client, area, property, sector or theme.

The guidance also gives examples of the types of assistance that authorities might wish to consider providing, subject to the overriding proviso that assistance may be provided in any form, and that authorities will be best placed to determine the type of assistance to be provided in the context of their policy priorities.

However, where assistance is to be provided by way of loans, authorities are required to obtain comprehensive legal and financial advice.

The extent of authorities' power to provide assistance under the order for housing renewal appears to be limited only by the requirement to comply with the pre-conditions for use of the power set out in the order, the overall strategic aims and objectives of the authority, and financial constraints.

The formulation of the policy and the way in which the power is used is for authorities to decide, except that in doing so, authorities must bear in mind that they are exercising a public law function, with the effect that general settled principles of administrative law, requires them, among other things, to have fair procedures, not to apply their policy rigidly and avoiding fettering discretion.

This means that in formulating their policies authorities should take care not to have a blanket policy of providing no assistance, and should also make allowance for consideration of applications individually, and exceptionally, even where that application falls outside the circumstances stated in their policy.

By William Okoya, barrister, Arden Chambers, London