This article, the first in a series for public matters looking at housing law issues in a regeneration context, seeks to outline some of the key consultation requirements that should be in a local authorities’ contemplation when they are looking to regenerate, and additional considerations in London.
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One of the great challenges faced by a local authority in carrying out regeneration is to make sure existing tenants are properly consulted. Get this wrong and the consequences are severe, if not fatal.
This article, the first in a series for public matters looking at housing law issues in a regeneration context, seeks to outline some of the key consultation requirements that should be in a local authorities’ contemplation when they are looking to regenerate, and additional considerations in London.
There are of course a host of factors under-pinning a successful tenant consultation exercise, the legal requirements being, in some respects, of least importance. Meeting statutory requirements is one thing, but it won’t cure a badly conceived consultation process delivering the wrong messages in the wrong way.
Section 32 of the Housing Act 1985 provides that a local housing authority may dispose of land held for housing purposes, but requires the consent (general or specific) of the Secretary of State before doing so. No consent is required for a letting on a secure or introductory tenancy (Section 32(2), 1985 Act). Due to Section 44, a disposal without the requisite consent is void, save as excepted. The Secretary of State has issued a series of general consents for these purposes:
It is important to note that if, as part of the regeneration project, any disposals are to take place pursuant to Section 32 which result in a secure or introductory tenant of the authority becoming the tenant of a private sector landlord, the consultation requirements in Schedule 3A of the 1985 Act will apply. The Secretary of State will not entertain an application for consent if this schedule applies unless the authority certifies that the consultation requirements have been complied with and copies of the notices issued by the authority are provided. The process for consultation is as follows:
Joint venture vehicles between local authorities and private sector developers are becoming increasingly popular as a way of pressing ahead with regeneration in light of local authority budget constraints. However, it is worth noting that the use of a joint venture arrangement might itself give rise to a requirement to consult local residents.
It was one of the grounds discussed in the case of Peters v Haringey [2018] EWHC 192 (Admin) where the court stated that the duty to consult under Section 3 of the Local Government Act 1999 was not simply confined to cases of outsourcing, but covers ‘arrangements’ - and a joint venture vehicle was an ‘arrangement’. Therefore, before the decision to enter into the joint venture scheme is made, a statutory duty to consult arose. The judgment itself is not clear on when the duty arises but we would suggest it should be considered at a formative stage, being as soon as the high level structure of the proposed joint venture is known, and no later than the beginning of the procurement process for a private sector partner.
The guide, published in February 2018, outlines specific ‘suggestions’ in relation to tenant consultation when undertaking regeneration within London. The principle target being large scale estate renewal schemes. Whilst it is not a legal requirement to comply with the guide, it is a requirement if the regeneration scheme is being supported by mayoral funding from City Hall, and generally we would suggest the guidance should be followed within London. The guidance can be read in full here.
It is noteworthy that the first ballot held (by Metropolitan Thames Valley for a scheme in Barnet) was successful; over 75 % voting in favour on a 66% ‘turnout’. The general view being that ballots should result in a positive outcome, provided the scheme is well developed, properly explained, and reflects tenant views.
If you are looking into options for regeneration in your local area and would like to chat through any questions or queries, please feel free to contact one of our experts who will be more than happy to help.
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