Southern Housing Group Limited (201916044)

REPORT

COMPLAINT 201916044

Southern Housing Group Limited

19 August 2021

Our approach

The Housing Ombudsman’s approach to investigating and determining complaints is to decide what is fair in all the circumstances of the case. This is set out in the Housing Act 1996 and the Housing Ombudsman Scheme (the Scheme). The Ombudsman considers the evidence and looks to see if there has been any ‘maladministration’, for example whether the landlord has failed to keep to the law, followed proper procedure, followed good practice or behaved in a reasonable and competent manner.

Both the resident and the landlord have submitted information to the Ombudsman and this has been carefully considered. Their accounts of what has happened are summarised below. This report is not an exhaustive description of all the events that have occurred in relation to this case, but an outline of the key issues as a background to the investigation’s findings.

The complaint

The resident has complained about:
1. The quality of the services provided through the service charges at their sheltered housing scheme.
2. The amount charged by the landlord in the service charges.

Jurisdiction

What we can and cannot consider is called the Ombudsman’s jurisdiction. This is governed by the Housing Ombudsman Scheme. When a complaint is brought to the Ombudsman, we must consider all the circumstances of the case as there are sometimes reasons why a complaint will not be investigated.
The resident’s complaint largely focuses on the quality of the services provided under the service charge. As part of this they have consistently raised complaints about the amount charged or the level of increases to the service charges.
The Housing Ombudsman Service cannot investigate whether the level charged for a service under the service charge is reasonable or not. We also cannot determine whether an increase to a service charge is reasonable or not. The First Tier Tribunal is responsible for determining any dispute about the level of service charges.
Paragraph 23(g) of the Housing Ombudsman Scheme states “23. The Ombudsman will not investigate complaints which, in the Ombudsman’s opinion: g. concern the level of rent or service charge or the amount of the rent or service charge increase.”
Therefore this case will only assess the landlord’s response to the complaint about the services (for example the quality or regularity of the services) and whether the response to the complaint was reasonable (for example whether it addressed all the appropriate issues that had been raised and the evidence it was based on).

Background

The complaint was raised with the landlord and then with the Housing Ombudsman as a group complaint by 4 assured tenants. Sadly, the lead complainant from the original complaint to the landlord passed away earlier in 2021.
The use of ‘the resident’ in this report refers to both lead complainants and, in turn, to the group as a whole.
The resident submitted a complaint in March 2020:
1. That the landlord had taken too long to arrange a repair or replacement for a washing machine. This meant the 21 properties in the scheme had to share the use of 1 machine, which they felt was inappropriate given the increased need for hygiene during the Covid-19 pandemic, and that all residents were in some way vulnerable given they lived in a sheltered scheme.
2. That it took too long (15 months) to resolve an electricity charge dispute. This complaint related to an overcharge for individual charges. The issue continued in this case as the communal charge also required a refund. As explained above however, the level of a service charge is outside the jurisdiction of the Housing Ombudsman Service and would be for the First Tier Tribunal.
3. That senior management had left the issues to the scheme’s management staff to address, despite the residents’ requests that senior management intervene.
4. That other services were ‘appalling’ despite the service charge, and this had been ongoing since the landlord took responsibility for the scheme. In particular:
  1. They considered a recent reduction in the charge for grounds maintenance as proof it was previously overcharged. The resident complained gardeners rarely attended, and if they did it was not for long. They also complained they had been charged for too long for the landlord’s hire of a garden waste bin.
  2. Window cleaning was ‘negligible’ despite an associated service charge.
  3. They believed the increases to the communal electricity and personal gas were too high and against government regulations. As explained above however, any complaints solely about the level or increase of a service charge must be determined by the First Tier Tribunal, and not the Housing Ombudsman Service.
  4. They believed income from a guest room should contribute to the service charges.
  5. That a lift light took too long to repair.
  6. There was a charge for an unspecified ‘health and safety’ cost.
  7. That the landlord did not respond to (unspecified) contact or complaints from residents over the previous 2 years.
  8. That the landlord inappropriately removed asbestos from the boiler room, causing risk to the residents.
  9. That they wanted a service charge refund credited to their accounts covering the previous 2 years.
The landlord sent two formal responses to the resident, on 6 April and 18 May 2020. The first response addressed each of the resident’s listed concerns in turn. It explained:
1. Non-emergency repairs (including the washing machine) have a 28-day repair timescale. There were 3 machines on site. One was replaced on 13 March. A second was then reported to have an intermittent fault. The replacement machine also then stopped working. The landlord’s contractor attended on 19 March, leaving 2 machines working. The new machine remained broken, and at the time of the complaint response (6 April) the landlord was discussing the issue with the supplier.
2. The ground maintenance charge had reduced after a new contractor was appointed. It had been using the contractor from the previous managing association for just this scheme, but had since appointed a contractor covering all its properties. This had resulted in a cost saving. It noted the standard/specification of the new service had been discussed at a resident panel.
3. The garden waste bin was a result of the previous contractor’s service, in that they did not remove waste. The new contractor’s service included the removal of waste so the charge had been removed. The charge was in place as the scheme ran a fixed service charge process (underspends are not returned and overspends are not added). Therefore the bin charge was added at the beginning of the year when relevant and carried through to the following year when it was removed due to the new contractor.
4. That the period complained about saw 2 window cleans per year, and the contractor had stated this was completed. Also, a new contractor had since been appointed and the window cleaning would increase to 4 times a year.
5. That guest room income is only credited to a scheme’s service charge if those charges in turn contribute towards the running of the room. As the charges for this scheme did not cover the running of the guest room the income was not credited to its account.
6. That the Property manager would investigate the delay in the lift light repair. The formal response did not include any explanation or response about the repair. It focused on the lift repair budget (which the residents had also focused on). However as explained above, while the repair is withing the Ombudsman’s jurisdiction, the amount charged is not.
7. That the health and safety budget covered the range of fire and electrical inspections that were required, as well as the washing machine repairs.
8. That the landlord accepted it had (unspecified) lessons to learn following the handover of the scheme to its management.
9. That residents were notified of work to the boiler room, though this did not specify asbestos. The landlord confirmed the contractors were licensed for asbestos removal.
10. The landlord also discussed the increases to the overall and basic service charges, and the resident’s claim for a refund. As explained above, any dispute over the level, or increase, to the service charge would be for the First Tier Tribunal to determine.
The resident escalated the complaint on 24 April. They responded with an annotated copy of the stage 1 response. They complained:
1. Residents had to queue to use the washing machines for over a month. The Covid-19 pandemic meant the repair should have been considered an emergency.
2. That the quality of the grounds maintenance had declined under the new contractor.
3. That the garden waste bin was a ‘fictious’ expense as it had not been provided for some of the period it was still included in the fixed service charge.
4. That the information from the window cleaning contractor was not accurate. The residents reported 1 (not 2) visits during the year and this had only cleaned communal windows, and not the windows of flats as due. The residents highlighted that the landlord did not visit or monitor the contractor’s performance and had relied on their justification of their own invoice.
5. That all charges (such as utility costs) for the guest room should be funded by its income, if the income is not shared with the wider service charge accounts. Alternatively the residents repeated that the income, as well as all the costs, could be included in the service charge accounts.
6. That the lift repair took ‘several weeks’ and the new light also malfunctioned. They also reported lift button lights that did not work.
7. That if washing machine repairs were part of the health and safety budget, they should have been completed quicker. They also raised the residents’ dissatisfaction with the quality of the cleaning service.
8. That the residents had noticed a drop in service when the landlord took on the management of the scheme in April 2018. They felt a formal apology, together with the service charge refund, was required.
The May final response followed a conversation and explained:
1. The landlord would be meeting with residents in summer after it had chance to finalise the year’s service charges. This would allow a ‘scientific’ review of the charges and any potential refund, as opposed to the resident’s request for an ‘arbitrary’ refund.
2. The third washing machine remained out of order as the landlord was reliant on the supplier, which in turn was restricted by the Covid-19 regulations. The landlord explained it did not have a date for the replacement/repair at the time of the final response.
3. That it was accepted there had been ‘teething’ issues with the new garden contractors and the landlord was ‘not happy’ with their service. It had visited the scheme with the contractor to discuss what was required and it was working to resolve the (unspecified) issues.
4. The new window cleaners would be monitored by the scheme manager. The landlord did not respond to the complaint about past performance.
5. The guest room income would be discussed at the meeting.
6. That general standards and service during the pandemic would be discussed at the meeting.
7. The lift light repair was not addressed in the response.
There was an exchange of emails in July where the landlord and resident discussed possible indoor and outdoor, as well as online, meetings. Although a date was agreed for September, the meeting was not possible due to the government and landlord advice at the time in response to the Covid-19 pandemic. The landlord continued to offer an online meeting.
The landlord sent a follow up to its final response on 2 October 2020. This was in response to the resident reiterating their complaint and contacting their MP. The landlord’s letter explained:
1. The complaint about the electrical charge amount was considered closed, following the refund.
2. It was agreed the new gardening contractor did not meet the required standard ‘for a few months’ when they started in October 2019. The landlord had met with the contractor’s manager and director and agreed for it to increase its time at the scheme at no extra cost. The landlord stated the contractor was now meeting the standard.
3. That while the complainant had stated there had been no improvement in services, the landlord felt the Covid-19 pandemic was a key factor. It gave the example of only one (instead of two) cleaners being able to attend during the lockdown. It also noted that all the washing machines were now working and being monitored.
4. That the landlord could not offer an arbitrary refund as the costs of the service had to be met, and the 50/60% refund requested by the complainant would ‘be felt by the charity.’

Assessment

A significant portion of the resident’s dissatisfaction is outside the jurisdiction of the Housing Ombudsman Service. The resident’s complaints were framed by a comparison of the services to the amount charged (or the amount a charge had been increased by). Therefore a significant amount of the complaint correspondence focuses on the level of the service charges.
As explained above, this case cannot determine whether a service charge is reasonable or not. As such it cannot explicitly address the resident’s request for a service charge refund on the basis that the amount previously charged was excessive.
In addition to this, the resident often compared the service provided to the previous landlord. This is also not a factor the Housing Ombudsman Service can assess. It can be helpful for a resident to explain how a service has changed over time (and the reasons they are unhappy with this). However ultimately the landlord’s obligation is to deliver the service required in the occupancy agreement and in its policies and procedures. This means our assessment will consider whether its responses to the complaint answered whether it was doing this or not. We will not compare the service provided by the current landlord to that of a previous landlord.
The resident has made generalised statements about the service provided by the landlord. This is important for the landlord to understand so that it understands the views of its residents, and so its response is proportionate. However it is also difficult to respond to general statements of dissatisfaction. This is further complicated by the fact general views are inherently subjective and cannot be compared to specific obligations in the documents mentioned above. Therefore this assessment will focus on the specific areas of the landlord’s service that the resident raised during their complaint, and whether the landlord’s responses responded to these reasonably or not.

Washing machines

The landlord has not provided the repair logs related to the washing machine. Neither party has provided correspondence from the time which shows the day when the first washing machine was reported as broken. The first formal complaint (16 March) states that 2 of the machines had been broken for ‘almost 3 weeks’ and this was not disputed in the landlord’s response. So it is reasonable to say the machines had been broken since approximately 24 February 2020.
The landlord reported a new machine was installed just before the formal complaint. This was presumably to resolve one of the broken machines. The landlord’s visit on 19 March determined the second machine had an intermittent fault. However at this visit it also confirmed the new machine had broken. Therefore it stated the scheme had two working machines (albeit one with an acknowledged intermittent fault) and that it was waiting for the supplier to resolve the broken new machine. The third machine remained out of order at the time of the May 2020 final response.
It was appropriate for the landlord to highlight the repair policy timescale of 28 days. Landlords use repair policies to manage their services and resources, and to set expectations with contractors and residents. The resident has complained that the context (Covid-19 and the nature of a sheltered scheme) meant the repair should have been considered an emergency. However just as this context made hygiene a priority, it also made resolving any repair issues (especially when third party suppliers are involved) more complicated.
Furthermore it is important to note that there were washing facilities during this time. The reduced service caused inconvenience to all residents, however there is always the chance that a repair will be needed and that, until it is complete, there is some inconvenience for the resident. So long as the repair is then completed in line with the policies and occupancy agreements the landlord does not need to offer redress for this inconvenience as it is beyond its control.

Gardening

The landlord continued with the legacy gardening contractor until October 2019. It then appointed a new contractor following a tender for a contractor to cover all of the landlord’s schemes.
The process to advertise and select a contractor is outside the jurisdiction of the Housing Ombudsman Service. These processes relate to commercial relationships and the Ombudsman can only assess the handling of complaints by residents about landlords. The impact a tender process has on the service charge (and whether that tendering process has been followed correctly) is for the First Tier Tribunal.
In terms of the complaint about the actual service, the landlord’s responses agreed that the new contractor’s performance had not been adequate.
The landlord explained how the service had moved from monitoring the number of hours spent at a scheme by the contractor, to a service managed through a specific scope of works. The landlord stated the scope of works had been consulted on with a tenant panel.
The landlord is responsible for arranging and managing its contractors. It is reasonable for landlords to consider different ways to manage services, including using different metrics such as standards as opposed to time. The landlord has not provided the details of the tenant panel where the new standards were consulted on. However, the resident’s response to this explanation did not dispute this either.
Ultimately it is agreed by both parties that the standards were not good enough. The landlord has provided a copy of an email to the gardening contractor sent 30 June 2020 listing the areas of concern following an inspection. This includes a list of substandard areas, a commitment by the contractors to provide a catch up programme at no cost, as well as monthly inspections and before and after photographs.
The Ombudsman’s Dispute Resolution Principles ask that landlords be fair, put things right and learn from complaints. The first priority following a complaint is to resolve any issues. In this case the landlord has responded by arranging for the issues to be resolved and changes made to avoid them in the future.
Given it is agreed there was a substandard service, and given the length of time involved (from October 2019 until June 2020) it would also have been appropriate for the landlord to consider some form of redress for the inconvenience experienced. However as the landlord did not make any such offer in its formal responses there was a failure in its response to this part of the complaint.

Window cleaning

As above, the landlord has again focused on the priority in any complaint response by addressing how the concerns will be dealt with in the future for the window cleaning. It explained a new contractor, with an increased amount of cleaning, had been appointed in the stage 1 response. It also confirmed the standard of cleaning would be monitored by the landlord’s scheme manager.
While this is a reasonable response to address ongoing concerns, the landlord failed to respond to the resident’s complaint about the past service.
The landlord’s first formal response confirms that its understanding of the contractor’s performance was only based on the contractor’s own past reports, and that it had not monitored the performance or investigated the standard of the window cleaning. The resident disputed the accuracy of this and provided specific information (that only 1 visit, not 2, had been completed and this visit did not clean all the windows). The landlord’s follow up responses then failed to engage with this issue.
The landlord should have offered some redress for the inconvenience caused by its failure to respond to the resident’s complaint about the standard of the past window cleaning. Therefore there was a failure in its response to this part of the complaint.

Service charge explanation

The Ombudsman can assess whether the landlord’s explanation about a service charge as part of a response to a formal complaint was reasonable or not.
The resident has complained about: the way the guest room income and costs are used with the scheme’s wider accounts; and that an unclear charge for health and safety was included.
The landlord has explained that the guest room income does not contribute to the overall scheme’s service charge. It has also explained that the service charges do not fund the costs associated with the guest room. The service charge statements provided do not include any costs associated with the management/maintenance of the guest room to support this explanation.
The management of the guest room is at the landlord’s discretion. The use of the guest room’s income (and management of its costs) is not included in the resident’s tenancy agreement. Therefore the landlord has no obligation to either include or exclude the income from the guest room in the scheme’s overall accounts. The approach taken by the landlord (to not contribute the income but to also not pass on the costs) is a reasonable approach to take.
In terms of the health and safety charge, the landlord has provided an explanation of the various services this covers. It highlighted the inspections required for fire and electrical safety. The landlord has stated that residents are able to request to view the supporting invoices for this charge. The landlord was correct to say that it is required to complete various inspections of the scheme, therefore it provided a reasonable explanation of this charge.

Lift repair

The resident complained a light in the lift took too long to repair, and that this was particularly important on a sheltered scheme. The resident’s complaints stated it had taken ‘over 2 weeks’ and ‘several weeks’ to resolve.
The landlord’s stage 1 response stated it would investigate the delayed repair. It did not explain why it had not already done so when preparing the response. The repair weas re-raised in the escalated complaint but the stage 2 response did not respond to this issue. This is a failure of the landlord’s complaint handling.
The landlord has not provided details of when the repair was completed, however the resident’s complaints confirm that it was, albeit with what they considered an unreasonable delay. The landlord should have responded to this issue to either identify any issues in its repair services, or to explain how the repairs service worked to then help manage resident expectations. As the landlord failed to respond to the complaint it is appropriate for it to offer some redress for the inconvenience.

Complaint handling

The residents have complained that their complaints were addressed to the Chief Executive and senior managers at the landlord, but that frontline staff and managers then responded.
It is normal for landlords to manage complaints sent to their senior management by asking more appropriate staff to respond. This is in part due to the volume of correspondence landlords receive, and in part because staff more involved in a service are best placed to try and resolve a complaint in the first instance.
Where a resolution is not possible it is appropriate for a more senior member of staff to respond to a complaint, however the exact process and person is again managed by the landlord as part of managing its own resources. The landlord has no obligation to send a reply from its Chief Executive or senior management when letters are sent to them. The priority is that an evidenced based investigation and response is used to try and resolve any remaining dispute.
In this case a manager and then a director sent the two formal responses. This was a reasonable process to use to respond to the complaint.
It was also reasonable for the landlord to explain that it would not use the resident’s request for what it considered an ‘arbitrary’ service charge refund as the starting point of the complaint discussion.
It is understandable that residents would look to base a compensation offer on their service charges if they believe those services had not been delivered. However we would not expect a landlord to start its investigation by considering whether a request for a flat refund of a specific percentage was reasonable or not. The complaint procedure is in place to identify any issues with the landlord’s actual services. Therefore it must investigate any specific issues and incidents to determine whether there have been any failures in its services. It can, from there, consider whether any offer of redress is appropriate.

Determination (decision)

I can confirm in accordance with paragraph 54 of the Housing Ombudsman Scheme there was service failure in the landlord’s response to the complaint about the quality of the services provided through the service charges.
I can confirm in accordance with paragraph 23 (g) the complaint about the amount charged by the landlord in the service charges is outside the jurisdiction of the Housing Ombudsman Service.

Orders

As a result of the determination above I have ordered that, within 4 weeks the landlord will:
1. Pay each of the 4 residents in the group complaint £150, consisting of:
  1. £50 to acknowledge the inconvenience caused by the agreed substandard gardening service between October 2019 and June 2020.
  2. £50 to acknowledge the inconvenience caused by the landlord’s failure to respond to the complaint about the past window cleaning service’s standards.
  3. £50 to acknowledge the inconvenience caused by the landlord’s failure to respond to the complaint about the time taken to repair the lift light.