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Opinion: Has the HCA done enough to convince the sector that it should charge fees?

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Opinion: Has the HCA done enough to convince the sector that it should charge fees?

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Published by Max Salsbury for 24dash.com in Housing and also in Central Government, Regulation

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Image: Housing via Shutterstock

By Phil Morgan, independent consultant and former TSA executive director

As someone who has been ‘in the thick of it’ as a senior regulator and broadly supportive of the principle of charging fees, I read the recent discussion paper released by the HCA with interest. Whilst some good points are made, especially by Julian Ashby in his introduction, three key points will need to be addressed further.

Firstly, let’s stop pretending that the government is about to stand aside from using the regulator to both legitimately align with objectives on housing benefit and to ‘policy passport’ the latest trendy fad from ministers (remember tenant cashback, anyone?). This means that it is reasonable for the sector to expect that government should cover some of the costs of the regulator.

Secondly, the paper makes a poor case for relating the fee to the actual cost of regulation. Instead everyone is given a standard fee based on size irrespective of their use of regulator resources. Whilst administratively convenient this does not seem fair. Given that the regulator clearly spends more resources on landlords with lower governance and viability ratings, then surely such landlords should be charged more than good landlords who are compliant and take up little of the regulator’s time and resources?

Finally, there is little sign of the greater accountability of the regulator to the sector for fees. Whilst value for money statements from the regulator are welcome, these should be expected anyway at a time when it is downgrading landlords because of their approach to value for money. The current forums have little resonance for most landlords who will expect something in the way of representation in exchange for taxation. Regional or sub-regional forums would be a welcome start.

But it’s not just landlords: tenants’ rents will increase (or services decrease) to pay for fees. They are also a stakeholder, and the recent select committee report on consumer regulation proposed an annual external check. Perhaps the greater accountability should extend to tenants too?

So I think the regulator hasn’t quite made the case for fee charging yet. But the opening up of debate is welcome and I look forward to hearing the views of my fellow board members with interest!

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