Glen Oaks HA

Introduction

Why do rents have to increase?

The effect of inflation on rent increases

What are your options? How much will you need to pay?

How do our rents compare with others?

What if rents are frozen by the Government? What we delivered in 2021/22

Rent Consultation 2023/24

Dear Tenant

This is the time of year where housing associations are thinking about their budgets for the next financial year starting in April 2023, and as a key part of that we’re starting our statutory consultation with tenants on what level of rent is set from April.

You’ve probably heard that between now and the end of March 2023, all rents - for social housing tenants and for private tenants - have been frozen by the Scottish Government as a result of the cost-of-living crisis. Glen Oaks Housing Association normally applies its annual rent increase around the middle of March, meaning that the freeze until the end of March 2023 will have an impact on our budget.

At this stage we can only assume that housing associations will be free to set their rents, following consultation with tenants, from next April, and getting those consultations under way now is something that both the Scottish Government and Scottish Housing Regulator are keen to see happen.

The Scottish Government have said that they will consider what rent increases are being consulted on when they make a decision - no later than mid-January - on what the outcome is to be on social housing rents from April 2023.

We would like to thank our Service Improvement Group for their help in producing this booklet. We hope the information in the booklet will help you to decide which option to vote for.

We want to hear what you think about our proposals, so it’s important that you take part in this consultation. Our Board values your opinion and will take your feedback into account when they make their decision. You can give us your views by text, email or post.

Thank you for reading this booklet and for taking the time to give us your feedback.

Simon Gaunt, Chairperson

This year we are considering 3 optionsan increase of 6%, 7% or 9%.

Why do rents have to increase?

It’s been a tough few years for all of us with external factors causing major financial pressures across the UK, including an economic environment of high inflation and high interest rates.

We know that, during this time, the last thing you want to think about is an increase in your rent. However, rents are our main source of income and the money we collect from rent is used to provide high quality services to our tenants and to invest in maintaining and improving your homes.

We appreciate that any rent increase, particularly during times of economic uncertainty, will be unpopular. However, the costs of providing our services and maintaining our neighbourhoods have increased significantly in recent months. These costs are expected to continue to rise in line with inflation, which is currently around 11.1%, the highest it’s been in over 30 years! Some things like construction and maintenance costs are increasing by as much as 20%, which is beyond the current rate of inflation.

In October we held a Cost-of-Living Event in our office, giving tenants the opportunity to meet with local support services for advice. At the event we conducted a survey to understand a bit more about our tenants’ current financial situation. 100% of respondents said they were concerned about the cost-ofliving crisis, and 85% said they were already cutting back on their expendable income to make savings.

We understand the financial hardship that many of our tenants are experiencing right now. If government legislation allows us to set an increase, we can assure you it will not be as high as the current level of inflation, given the other cost of living pressures faced by tenants.

The effect of inflation on rent increases

Increases in rent normally reflect RPI or CPI. The rent increase in March 2022 was 3.5%, reflecting a sector wide trend to set belowinflation increases. By the time of the increase in March this year, RPI had risen to 9.0%. At the moment RPI is 14.2% and CPI is 11.1%.

The graph below shows how our rent levels have compared to RPI and CPI over recent years:

*

*the increase for 2023 has been estimated at 7% for comparison purposes only

The options we are proposing allow us to:

• Continue to invest in the maintenance and improvement of our properties. This will include the replacement of kitchens, bathrooms and windows as required.

• Support community initiatives such as Workingrite, goConnect, and welfare rights advice for tenants.

• Continue our cost savings exercise outlined last year of £150,000 over 6 years through reductions in:

• Salary costs

• Office overheads

• Review of some of our non-essential services

What are your options?

Option 1: 6% Option 2: 7% Option 3: 9%

As it stands just now this option would mean a longer-term effect on rent increases for the next five years

This would be 1% above inflation to meet future service delivery, maintenance and property costs.

As it stands just now this option would mean a shorter-term effect on rent increases for the next three years

This would be 1% above inflation to meet future service delivery, maintenance and property costs.

This option allows us to maintain the level of rent increase in our plans which is 0.5% above inflation.

How much will you need to pay?

Size of home

Scottish average weekly rent

Glen Oaks current average weekly rent

Proposed average weekly rent after 6% increase

Proposed average weekly rent after 7% increase

Proposed average weekly rent after 9% increase 2 apartment £81.32 £87.23 £92.46 £93.33 £95.08 3 apartment £84.18 £92.49 £98.04 £98.96 £100.81 4 apartment £91.48 £100.48 £106.50 £107.50 £109.52 5 apartment £100.74 £123.98 £131.42 £132.66 £135.14

How do our rents compare with other housing associations in Scotland?

Size of home

2 apartment £87.23 £81.54 £83.96 £79.23 3 apartment £92.49 £94.46 £89.63 £91.12 4 apartment £100.48 £103.73 £103.98 £102.83 5 apartment £123.98 £111.44 £113.92 £116.58

If you would like to find out more about the average weekly rents charged by other housing associations in Scotland, you can do this by visiting the Scottish Housing Regulator’s website at www scottishhousingregulator.gov.uk

What if rents are frozen by the Government beyond 31 March?

If a cap or rent freeze is imposed by the Government it would result in a financial shortfall for the Association in future years. It would also affect our planned maintenance & development programmes and future service levels. This would ultimately require much higher rent increases to be imposed in subsequent years.

Service charges

We may provide other services e.g. stair cleaning in the closes in Arden, for which we will add an extra charge on top of your rent. If you receive any additional services from us, please be assured that we will only charge you for your share of the actual cost of the service. Although there will be an increase in service charges from April 2023, it is likely to be lower than the rent increase.

What we delivered in 2021/22

For the year to 31 March 2022, we collected £6,340,562 in rent. This money allowed us to continue to provide our services, including repairs and maintenance to tenants’ homes. Although we had to suspend our kitchen and bathroom programme due firstly to the pandemic and then because of the increasing cost of labour and materials, we continued to carry out a full programme of reactive, void and cyclical maintenance work and a reduced level of planned component replacements. We spent £1.5 million on reactive repairs, cyclical and void property maintenance. This included:

97.5% of reactive repairs carried out on time

95.5% of reactive repairs completed right first time Annual gas servicing of all properties

Completion of programme to install linked smoke and heat detectors in all properties

Medical adaptations completed in 19 properties

Close painter work at 15 closes in Arden

External paintwork at a further 71 properties

Completion of our 3 year tree-felling and pruning programme in all areas

New build

We are very proud of the new homes we have been able to build over the past 30 years. This has been possible with the help of grant funding from the Scottish Government and Glasgow City Council, in addition to private finance (loans). Part of the money you pay in rent goes towards paying those loans and allows us to continue to build much-needed new homes.

Covering our costs

Every penny we collect in rental income goes back into providing housing services and improving our properties. However, the cost of doing this has risen considerably over the past year. This in turn impacts on our ability to maintain these services without a significant increase in rental income.

Making savings

Following last year’s consultation exercise the Association committed to making £150,000 savings over a 6-year period. This year, with a below inflation rent increase, we will need to make difficult decisions in order to reduce our costs.

Non-essential services

Some of our services such as the extensive wider role initiatives and bulk uplift service go above and beyond the traditional role of landlords. The goConnect project has helped some of our most vulnerable tenants to remain in their homes by providing a range of support services, as well as offering digital, financial and energy advice. In the last 12 months we made 4350 referrals for our tenants by either signposting or formal referrals to specialist agencies that can offer additional help.

Our partnership with Workingrite has helped many young people from our communities into employment. The Gold Service scheme rewards tenants for keeping to their tenancy agreement. Although both of these initiatives are valued by tenants, they are not core services and there is an additional cost for providing them.

This year Glasgow City Council stopped the free bulk uplift service. To ensure our communities were kept clean and safe, we have had to employ contractors to provide a service to uplift and dispose of bulk from our tenement properties. From April 2022 we increased the service charge payable by tenants in our tenement flats in Arden. Whilst this covered most of the cost for the pull-through service, along with the uplift and disposal of bulk items, the Association has to cover the remainder to ensure that our neighbourhoods are maintained to a good standard.

Value for money

We work hard to make sure that your rent and other charges continue to be affordable and deliver value for money. One of the ways we do this is by making sure that we strike a balance between cost and quality when we buy services or hire contractors to carry out work for us.

What happens next?

We’ve tried to make it as easy as possible for you to give us your views. You can reply to the text message or email we sent you with this information. Alternatively, you can return the survey form by freepost. For

Providing that there is no further Government intervention, our Board will meet in January 2023 to agree the most suitable rent increase option, taking into consideration the feedback from our tenants, together with the financial implications at the time.

You will be given at least 4 weeks’ notice of any proposed increase to your rent and service charges which will take effect from 10 April 2023.

Help and support

Are you struggling to pay your rent? If you are, please don’t let things get on top of you, we can help!

Our Housing Services Officers are here to give you the help and support you need, and your concerns will be dealt with confidentially and sensitively. Your Housing Services Officer can also refer you to one of our Welfare Rights or Money Advisors who can help you with benefit or financial issues. In the past year, we have obtained over £500,000 in additional income for tenants who used these services.

Contact your Housing Services Officer on 0141 620 2722.

Did you know that we have tenants ‘on Board’?

Each year setting the rent increase is one of the Board’s most important decisions. We currently have three tenant Board members who directly influence this decision.

If you are passionate about your community and would like to be involved in our decision-making process, joining our Board could be a great opportunity for you to really make a difference!

If you would like to know more about our Board or would be interested in finding out other ways in which you can participate, please contact a member of our Corporate Services Team for more information – 0141 638 0999 (Option 4).

Data protection statement

The personal information we are asking for in the survey form is required for the purposes of the shopping voucher prize draw and to allow us to contact you if you have asked us for a response. Your information will be used for these purposes only and will be processed and held securely in terms of data protection legislation. For further information on our legal basis for processing your information and your rights in terms of data protection legislation, please read our Privacy Notice which is available on our websitewww.glenoaks.org.uk

Jargon Buster

Consumer

Price Index (CPI)

The Consumer Price Index (CPI) is the official measure of inflation of consumer prices of the United Kingdom, which examines the weighted average of prices of a basket of approximately 700 consumer goods and services. This includes transportation, food, and medical care. The CPI calculates the average price increase as a percentage.

Retail Price Index (RPI)

Service Charge

The Retail Price Index (RPI) is currently used to index various prices and incomes including tax allowances, state benefits, pensions and index-linked gilts. In housing terms, it is commonly used as a baseline to determine proposals for annual rent increases.

A landlord sometimes offers a specific service to some of its tenants and levies a separate charge on top of their rents to cover the cost - this is called a service charge. For example, tenants living in a block of flats may be charged a service charge to cover cleaning of the common areas.

Value for Money (VfM)

Scottish Housing Regulator (SHR)

Cyclical Maintenance

A term used to measure the quality and performance of services provided against the cost of delivering them.

The independent regulator of social housing services. They are responsible for assessing and reporting on how all landlords are performing (including local authority landlords), and the financial wellbeing and standard of governance of RSLs. They can intervene to secure improvements where necessary.

The process of regular planned maintenance of various fixtures, fittings, and components in a house. For example: gas boilers. The landlord does not require a survey to make a decision that maintenance is required. It happens automatically at regular intervals.

Planned Maintenance

The landlord will survey parts of the housing stock and decide which components need replaced in all or some of the houses. This is then included in the budget and tenders sought from contractors to carry out the work. For example, the rewiring of a group of houses would be planned maintenance.

Medical Adaptations

Data Protection

Housing that has been altered or built to include features that make it suitable for a person(s) with specific needs.

The Data Protection Act 2018 is the UK’s implementation of the General Data Protection Regulation (GDPR). The Act controls how personal information is used by organisations, businesses, or the government.