Housing Revenue Account Service Charges Policy

Residents, both tenants and leaseholders, have a right to know what additional services will be provided and how services charges will be calculated. These service charges are set in accordance with the Regulator of Social Housing Rent Standard and in accordance with any Lease. This is an explanation of why we charge service charges, what these service charges are, and the broad principles of how they are calculated.

The rent paid by tenants covers the provision of basic services such as maintenance and improvements to properties, lettings, estate management and advice and support on issues such as anti-social behaviour. This helps us to effectively manage our housing stock.

Where costs are incurred for providing services over and above what is normally included in the rent paid by tenants, a service charge is calculated to recover these costs. In line with our legal requirements, we ensure service charges are set no higher than what is needed to cover our costs for those services and that they are reasonable. If we do not charge tenants for these services, then this will reduce the money we have to pay for the basic services such as carrying out repairs, improvements and building new homes.

Rent Payments

Tenants pay rent for the exclusive use of their home. In return we are required to:

• Repair the structure and exterior of properties (including drains, gutters and external pipes)
• Repair the installations that supply water, gas and electricity and sanitation (including basins, sinks, baths and sanitary conveniences
• Repair the installations for heating and heating water (including boilers and immersion heaters)

Service Charges

Service charges are calculated to recover the costs of providing communal services, such as cleaning, grounds maintenance and electricity, to tenants. Not all tenants receive additional services and the amount that is charged will depend on what type of property a tenant lives in, and what services are provided.

Additional items may be charged for as part of your service charge from time to time. The fact that a service is listed does not mean that we will provide it. These are examples of services that you may be charged for by way of a service charge.

• Grounds maintenance
• Cleaning of communal areas, and window cleaning
• Door Entry System
• Electricity charges for communal areas

There are additional services that some tenants living in our Retirement Living Courts might pay for, including:

• Court Manager Service, including emergency alarm and door entry system
• Communal heating and lighting
• Domestic heating, electricity & water
• Laundry charge
• Scooter storage charge

Calculating service charges

Each year, normally in February or March, we will write to tenants to notify them of any changes in their rent for the coming year, April to March. The notification will also tell them how much service charge they will have to pay for the year.

Service charges will be calculated based on what we know or estimate it will cost to provide services to a block of flats or other group of properties. Normally the charge will be based on what has been spent in previous years but we may also consider how inflation or other costs such as prices from contractors may affect the charge. The provision of new services will also affect the charge and sometimes we will estimate a charge. Where we are considering previous years’ costs in our calculations, we will need to refer to those costs incurred in the last full financial year. For example, for setting charges for 2020/21 we will refer to costs incurred in 2018/19.

The rent notification letter will set out a schedule of services that will be provided and how much we will charge for them.

We will only increase service charges within the legal requirement that they will not exceed the cost of the services and will always be reasonable.

Sharing costs between residents

Once the full year costs are worked out for each block of flats or group of properties receiving extra services this is divided by the number of flats or properties to calculate the annual cost for each. Costs are also shared with leaseholders (those people who have bought their flats).

Variable Service Charges

Variable charges are payable directly or indirectly for services, repairs, maintenance, improvements or insurance, or the landlord’s costs of management in respect of a dwelling. The whole or part of the charge varies or may vary depending on the cost actually incurred.

In almost all circumstances, the service charges are variable meaning that they reflect the actual cost incurred, or where this is not known, they are estimated and adjusted when the costs are known. For tenants, these charges are collected together with the weekly rent, apart from the few sites where domestic gas, electric and water charges are collected monthly in arrears.

Grounds Maintenance

Many estates and Retirement Living Courts benefit from our contractors carrying out work on communal grounds. This can include grass cutting, works to beds and borders, hedge cutting, ditch clearance and hard landscaping. This work is carried out by our contractor, but only to areas where we have a responsibility to carry out this work such as external communal areas that surround a building or group of properties which are not for the sole use of an individual resident. This work is carried out by a contractor.

A separate contractor is responsible for works to trees. Generally, the only tree work carried out is where there is an urgent need.

The cost is divided equally among the properties in a building or group.

Cleaning of communal areas

All our Retirement Living Courts, and many of our generals needs blocks of flats where there are communal hall, landings and stairs, benefit from a regular cleaning service from our contractor. Retirement Living Courts also have other communal areas, such as a communal lounge, laundry room and bin area that is cleaned. There will also be ad hoc additional cleaning in communal areas.

Windows in most Retirement Living schemes, and in general needs blocks of flats are cleaned. It is generally just the communal windows that are cleaned.

The cleaning costs are divided equally among the properties in a building or group. This work is carried out by our cleaning contractor.

Electricity charges for communal areas

This charge relates to the supply of electricity to any communal areas. Electricity is used for lighting to corridors, stairwells and entrances, door entry system and fire alarm system. In some blocks of flats electricity is also used to heat communal areas. Each block of flats has a communal meter for electricity usage in shared areas. The cost is divided equally among the properties in a building or group. For communal electricity, we are a member of a consortium that ensures we obtain a competitive rate for these charges. This is an annual contract.

Door Entry System

All retirement living Courts and most general needs flats where there is a communal front door benefit from a communal door entry system. Costs associated with this system, such as servicing, are divided equally among the properties in the Court or block.

This work is carried out by a specialist contractor, or by our electrical contractor.

Court Manager Service

This charge relates to all costs associated with providing this service to Retirement Living Courts, including staffing costs and the emergency alarm system. Staff are employed by Wealden District Council, although on occasions, temporary agency staff may be taken on to ensure service provision. The emergency alarm is provided by a specialist contractor. Costs are divided equally among properties in the Court or block.

Heating and hot water charge

This generally relates to the supply of heating and hot water to communal areas in Retirement Living Courts.

In some cases, it may relate to the costs of providing heating and hot water to individual properties; this is known as domestic supply.

Some properties have heating and hot water provided by a communal boiler, and we also charge for the cost of having meters read and the cost for distribution of heat and water throughout the building or scheme. In most cases, the cost is divided between communal and domestic supply. The charge is then divided between the number of properties, with the large properties paying a higher amount.

Some newer properties have individual meters for domestic supply which allow us to charge tenants for what is used. In these circumstances, the charges will not be collected with the weekly rent. Depending on the site, residents will either have a pre-payment meter, or will be charged monthly in arrears. However, if we experience billing difficulties, we do reserve the right to calculate charges by dividing the total cost amongst residents, and charge with the weekly rent until such time as the billing difficulties are overcome. This does mean that residents will avoid large bills when difficulties are resolved.

For communal heating and hot water, whether this is supplied by gas or electricity we are a member of a consortium that ensures we obtain a competitive rate for these charges. This is an annual contract.

Water and sewerage

Where these charges apply, the costs will be divided equally amongst all residents in the building.

Laundry charge

The cost of servicing equipment and the cost of water and electricity. Washing machines are provided in most of our Retirement Living schemes for residents to use. The cost is divided equally among the properties in a building or group. Costs for water and electricity are obtained from utility companies. Repairs are undertaken by a specialist contractor.

Scooter storage charges

Some Retirement Living Courts are provided with scooter storage where tenants can also charge their mobility scooters. Tenants who use this are charged for electricity and electrical tests. Our electrical contractors undertake the electric tests.

Service charges to leaseholders will reflect what is in their leasehold agreement. Contained here is general guidance rather than detailed information. As leasehold agreements do vary, where there is any difference between what is stated in this document and the lease, it is the lease that takes priority.

Rent Payments

For shared equity leaseholders, there is a rent payment to cover the equity that is rented from the landlord. Repairing obligations remain with the leaseholder.

Service Charges

These are dictated by what is contained in your lease. Service charges are calculated to recover the costs of providing communal services, such as cleaning, repairs, grounds maintenance and electricity. Not all leaseholders receive additional services and the amount that is charged will depend on the type of property a leaseholder lives in, and what services are provided.

Additional items may be charged for as part of your service charge from time to time. The fact that a service is listed does not mean that we will provide it. These are examples of services that you may be charged for by way of a service charge.

• Grounds maintenance
• Cleaning of communal areas, and window cleaning
• Door Entry System
• Electricity charges for communal areas
• Repairs to communal areas

There are additional services that leaseholders living in our Retirement Living Courts might pay for, including:

• Court Manager Service, including emergency alarm and door entry system
• Communal heating and lighting
• Domestic heating, electricity & water
• Laundry charge
• Scooter storage charge

Some leases provide for an administration charge of 10%. This does not apply to utility bills.

Calculating service charges

Each year, normally in February or March, we will write to shared ownership Retirement Living leaseholders to notify them how much service charges they will have to pay for the year, April to March. The notification will also tell them of any changes in their rent, where payable, for the coming year.

Right to Buy leaseholders are usually notified in April with an annual estimated charge and again within six months of the year end with the Final account figures.

Service charges will be calculated based on what we know or estimate it will cost to provide services to a block of flats or other group of properties. Normally the charge will be based on what has been spent in previous years but we may also consider how inflation or other costs such as prices from contractors may affect the charge. The provision of new services will also affect the charge and sometimes we will estimate a charge. Where we are considering previous years’ costs in our calculations, we will need to refer to those costs incurred in the last full financial year.

We will only increase service charges within the legal requirement that they will not exceed the cost of the services and will always be reasonable.

Sharing costs between residents

Once the full year costs are worked out for each block of flats or group of properties receiving services this is divided by the number of flats or properties to calculate the annual cost for each. Most costs are also shared with tenants although leaseholders do pay for services such as buildings insurance, communal repairs and servicing, and their share of capital works to the block, for example the replacement of roofs.

Variable Service Charges

Variable charges are payable directly or indirectly for services, repairs, maintenance, improvements or insurance, or the landlord’s costs of management in respect of a dwelling. The whole or part of the charge varies or may vary depending on the cost actually incurred.

In almost all circumstances, the service charges are variable meaning that they reflect the actual cost incurred, or where this is not known, they are estimated and adjusted when the costs are known. For Right to Buy leaseholders, service charges are collected annually.

Grounds Maintenance

Many estates and Retirement Living Courts benefit from our contractors carrying out work on communal grounds. This can include grass cutting, works to beds and borders, hedge cutting, ditch clearance and hard landscaping. This work is carried out by our contractor, but only to areas where we have a responsibility to carry out this work such as external communal areas that surround a building or group of properties which are not for the sole use of an individual resident. This work is carried out by a contractor.

A separate contractor is responsible for works to trees. Generally, the only tree work carried out is where there is an urgent need, such as where the tree is dangerous.

The cost is divided equally among the properties in a building or group.

Cleaning of communal areas

All our Retirement Living Courts, and many of our generals needs blocks of flats where Leaseholders reside and where there are communal halls, landings and stairs, benefit from a regular cleaning service from our contractor. Retirement Living Courts also have other communal areas, such as a communal lounge, laundry room and bin area that is cleaned. There will also be ad hoc additional cleaning in communal areas.

Windows in most Retirement Living Courts, and in general needs blocks of flats are cleaned. It is generally just the communal windows that are cleaned.

The cleaning costs are divided equally among the properties in a building or group. This work is carried out by our cleaning contractor.

Electricity charges for communal areas

This charge relates to the supply of electricity to any communal areas. Electricity is used for lighting to corridors, stairwells and entrances, door entry system and fire alarm system. In some blocks of flats electricity is also used to heat communal areas. Each block of flats has a communal meter for electricity usage in shared areas. The cost is divided equally among the properties in a building or group. For communal electricity, we are a member of a consortium that ensures we obtain a competitive rate for these charges. This is an annual contract.

Door Entry System

All Retirement Living Courts and most general needs flats where there is a communal front door benefit from a communal door entry system. Costs associated with this system, such as servicing, are divided equally among the properties in the Court or block. There may also be a broadband or Wi-Fi charge relating to this provision.

This work is carried out by a specialist contractor, or by our electrical contractor.

Court Manager Service

This charge relates to all costs in Retirement Living Courts associated with providing this service within, including staffing costs and the emergency alarm system. Staff are employed by Wealden District Council, although on occasions, temporary agency staff may be taken on to ensure service provision. The emergency alarm is provided by a specialist contractor.

Costs are divided equally among properties in the Court or block.

Heating and hot water charge

This generally relates to the supply of heating and hot water to communal areas in Retirement Living Courts.

In some cases, it may relate to the costs of providing heating and hot water to individual properties; this is known as domestic supply.

Some properties have heating and hot water provided by a communal boiler, and we also charge for the cost of having meters read and the cost for distribution of heat and water throughout the building or scheme. In most cases, the cost is divided between communal and domestic supply. The charge is then divided between the number of properties, with the large properties paying a higher amount.

Some newer properties have individual meters for domestic supply which allow us to charge residents for what is used. In these circumstances, the charges will not be collected with the weekly rent. Depending on the site, residents will either have a pre-payment meter, or will be charged monthly in arrears. However, if we experience billing difficulties, we do reserve the right to calculate charges by dividing the total cost amongst residents, and charge with the weekly rent until such time as the billing difficulties are overcome. This does mean that residents will avoid large bills when difficulties are resolved.

For communal heating and hot water, whether this is supplied by gas or electricity we are a member of a consortium that ensures we obtain a competitive rate for these charges. This is an annual contract.

Water and sewerage

Where these charges apply, the costs will be divided equally amongst all residents in the building.

Laundry charge

The cost of servicing equipment and the cost of water and electricity. Washing machines are provided in most of our Retirement Living Courts for residents to use. The cost is divided equally among the properties in a building or group. Costs for water and electricity are obtained from utility companies. Repairs are undertaken by a specialist contractor.

Scooter storage charges

Some Retirement Living Courts are provided with scooter storage where residents can also charge their mobility scooters. Residents who use this are charged for electricity and electrical tests. Our electrical contractors undertake the electric tests.

One-off Charges

These are charges that are not applied every year. They include items such as the cost of removing rubbish in communal areas, replacement of communal television aerials. This may be work carried out by our staff, our contractors or specialist contractors, depending on the nature of the work. The cost will be divided equally among the properties in the building or site.

New service charges

There may be times when we need to consider the introduction of a new service for which we will charge all residents. This may be to comply with legislation, to improve a service or because of feedback from residents. In these circumstances we will consult all residents who may be affected by the proposal.

If we want to introduce any new services or charge you for one that we already provide but you do not pay for, then we will give you 28 days’ notice of the new charges. These will not exceed the cost of the new service provided and will always be reasonable. We may decide to phase in any new charges.

Complaints

If a resident has a query with the charges being made, then they can seek further information from us. If they feel that we have not adhered to our policy, or are otherwise unhappy about the service, then they can use our formal complaints procedure. We will always attempt to resolve complaints but if a resident is unhappy with our response they have the right to refer the matter to the Housing Ombudsman.

We will provide clear information on how service charges are set in accordance with the Regulator of Social Housing (formerly the Homes and Communities Agency) Rent Standard.

A leaseholder can challenge the reasonableness of a service charge ultimately, by applying to the appropriate Tribunal. In England, this is the First-tier Tribunal (Property Chamber). They have power to make a ruling whether, or how much of, a service charge is reasonable or payable.

Review of Policy

This policy will be reviewed and amended as necessary every five years.