Council ignores questions on rent increase

WERA

Updated: 16/05/2023

The Committee of the World's End Residents Association (WERA) has written to Councillor Kim Taylor-Smith, Lead Member for Housing and Social Investment at the Council, with regards to the latest rent increase. To date Councillor Taylor-Smith has only responded with platitudes and sound bites and has yet to answer any of the Committee's questions.

Council tenants living on the World's End Estate started receiving letters notifying them of the rent increase in early March 2023.

The Council told tenants that it was increasing their rents by over 20% and some individual chargeable items that make up the rent by as much as 150% (2.5 times). All tenants were asked to pay an additional £1,800 a year in heating and hot water charges, in addition to the overall increase in their rent, something many simply can't afford.

Many tenants, including members of the WERA Committee, were alarmed by the Council's plans and brought their concerns to the attention of the whole Committee.

After examining the letter at length the WERA Committee decided to write to Councillor Kim Taylor-Smith, the Council's Lead Member for Housing and Social Investment, with a number of questions. The letter was emailed to Councillor Kim Taylor-Smith and Doug Goldring, the Council’s Director of Housing, on the 13th of March 2023. A copy of the letter was also emailed to Greg Hands MP, the member of parliament for Chelsea and Fulham, at the same time.

A copy of that letter is available for download here:  

Letter from WERA Committee with regards to Rent Increase

The WERA Committee waited a week. Seven days had passed. It was the 20th of March 2023 and Councillor Kim Taylor-Smith had not responded in any way to the Committee's email and letter, not even to confirm receipt. The WERA Committee emailed him a polite, gentle reminder.

Councillor Kim Taylor-Smith responded by email later that day with a short, three-line explanatory paragraph and a link to an article on the website of London Councils. Neither the three-line paragraph nor the article on the London Councils website answered any of the questions in the WERA Committee's letter.

The WERA Committee replied to Councillor Taylor-Smith that same day by politely pointing out that his response had not provided answers to any of the questions in the Committee's letter and politely requesting that he do so at his earliest convenience.

Councillor Kim Taylor-Smith responded by email for a second time on the 22nd of March 2023. This second response was longer but amounted to little more than what appeared to be a prepared statement (the Council's PR department and spin doctors at work?) that also failed to answer any of the questions in the WERA Committee's letter.

The WERA Committee once again responded that same day politely pointing out that none of the questions in the letter had been answered. For the sake of expediency they asked Councillor Kim Taylor-Smith to try and provide answers to just three simple questions:

• Whether the costs the Council was passing on to tenants through the rent increase were actively being incurred.

• If the costs were being incurred if copies of relevant documents, for example invoices or bills, could be made available for inspection.

• If the costs were not being incurred if he could provide an explanation as to why the Council felt justified to pass on costs that it had not actually incurred in this way.

At the time of writing (the 31st of March 2023) there have been no further emails from Councillor Kim Taylor-Smith.

On the 30th of March 2023 the leaseholders of the estate started receiving service charge demands for the next financial year.

The Council was increasing their service charge by up to 80% (1.8 times). The demand included massive increases in the cost of electricity and gas. The cost of electricity had increased tenfold (10 times). The cost of gas had increased by 219% (3.2 times). Notably none of the increases aligned with those for Council tenants (as above).

The WERA Committee wrote to the Housing Department’s Home Ownership Team on the 31st of March 2023 to query the largest increases in the service charge, and in particular the tenfold increase in the cost of electricity, which was totally unprecedented and clearly required proper explanation. The WERA Committee is not aware of any electricity supplier in the UK, retail or wholesale, increasing their charges for electricity by 1,000%.

The WERA Committee is concerned that, yet again, the Council is taking money from it's tenants (in this case its leaseholders) for expenditure that it has not incurred and may never incur. Although in the case of the incredible tenfold increase in electricity costs plain and simple incompetence on the part of those who put together the service charge demand cannot be ruled out.

Leaseholders are fortunate in that the Council is required to return their money if it does not spend it within the financial year (unlike Council tenants, who will never see their money again, whether the Council does spend it on what they claim the need it for or not). But not for at least eighteen months. The Council is effectively borrowing large amounts of money from its leaseholders interest free.

On the same day the WERA Committee wrote, once again, to Councillor Kim Taylor-Smith, bringing the tenfold increase in electricity costs and the 3.2 times increase in gas costs in the latest leaseholder service charge to his attention. Once again the WERA Committee politely asked Councillor Taylor-Smith to provide answers to the three simple questions that had previously been asked on three separate occasions - in the original letter, in the response to his first email, and in the response to his second email.

The WERA Committee continues to await Councillor Kim Taylor-Smith's response to three simple questions.

It is now early May and it is worth noting that Greg Hands' office have tried to help.

From the moment that they were copied in to the first letter to Councillor Taylor-Smith they have tried to obtain answers to the same questions posed by WERA.

Unfortunately the Council have provided Greg Hands' office with the same ridiculously uninformative responses they have provided everyone else. And what can you do when the Council are clearly perfectly happy to respond to the local MP with the same nonsense and mushroom-feed they send their tenants and leaseholders? Not a lot.

We've thanked Greg Hands and his office staff for his assistance, which we do very much appreciate, and will carry on pursuing the matter without their help.

It is now the 16th of May 2023. To no one's surprise Councillor Kim Taylor-Smith has opted to completely disengage and refuse to answer any questions rather than shed light on what the Council is up to. No more has been heard from him since he responded with a carefully crafted bit of fluff and PR on the 22nd of March 2023. Councillor Taylor-Smith's behaviour would be shocking had we not seen it before. But the sad truth is that we have. Many times.

The Council's Home Ownership Team is little better. WERA initially emailed them on the 31st of March 2023 and has emailed them repeatedly since. To their credit they are, at the time of writing, still responding to emails but they are clearly choosing which questions to respond to and which to ignore.

For example, they have yet to produce any meaningful evidence of the increased energy costs the Council is supposedly incurring despite having just billed all of the estate's leaseholders for them (as above). In a brief and vanishingly small moment of transparency they did confirm that the latest increase in gas and electricity costs was based on a forecast produced by one of the Council's countless consultants, a firm called Concept Energy, and not on costs actually being incurred by the Council. However, when repeatedly asked (four times and counting!) to provide the exact figures from this forecast, as well as evidence of costs incurred in financial years 2021-22 and 2022-23, they have repeatedly failed to do so.

The cynical might be tempted to conclude that the latest service charge has no actual basis in reality and that the increase is little more than a scheme to improve the Council's cash flow at leaseholders' expense.

It is worth noting that the Council are obliged to provide its leaseholders (and the Residents Associations that represent them) with proof of expenditure when asked to do so and that leaseholders would be well within their rights to refuse to pay and challenge the service charge at a Tribunal if they do not. The service charge may be an estimate but it needs to be based on reality. WERA does not currently propose that leaseholders do this, but it may be worth considering given the magnitude of the increase (80%) and the complete absence of meaningful responses, let alone concrete information about costs incurred, from anyone at the Council two months on.

Our thoughts:

The WERA Committee has no issue with the Council passing on costs that have been lawfully and justifiably incurred but the Council does not appeared to have done that. They appear to be passing on costs that they have not incurred and may never incur. Entirely theoretical costs if you will.

As things stand, and without any answers or clarification from Councillor Kim Taylor-Smith or anyone else at the Council, the WERA Committee can only conclude that the Council has indeed increased the rent of its tenants and the service charges of its leaseholders based solely on forecasts and estimates of the money it might need to spend at some indeterminate point in the future, not on the money it actually needs or spends today, or even tomorrow.

The WERA Committee does not believe this is reasonable behaviour in the midst of a cost-of-living crisis that is already having a serious deleterious impact on many low income households on the estate. The Council appears intent on making a bad situation worse.

What is most disheartening however is that no-one at the Council, and clearly not Councillor Kim Taylor-Smith, is willing to explain what it is that the Council has actually done.

When you effectively refuse to answer a question as simple as ''are the costs you are passing on to tenants through the rent increase actually being incurred?'' what are people supposed to think?

We'll tell you what they will think - not that you don't know, that you are hiding something.

And if you are unwilling to explain what it is that you have done you are also clearly unwilling to take any responsibility for your decision or any of the problems that it may cause.

Does this behaviour remind you of anything?

The Council promised a great deal in the aftermath of the Grenfell Tower fire. It has failed to deliver on the vast majority of those promises. In some cases, such as this one, spectacularly so. Councillor Kim Taylor-Smith and the Council's Housing Department have been preaching openness and transparency ever since the fire, but they clearly don't practice it.