Summary: The Council has a clear process showing how applicants are accepted onto its direct offer list but follows a random, discretionary process to determine which properties are offered to these applicants. This adds uncertainty in terms of how long someone will wait for a direct offer and information provided about waiting times may not be accurate. The Council has agreed to take action which to better monitor the wait times and make improvements to its service.

The complaint

1. As a result of another investigation we conducted, we are aware the number of pending offers of direct lets means the Council is operating a second allocation list without clearly setting out the criteria for this list and how it interacts with the published allocations policy. This is likely to have caused uncertainty to those affected in terms of how long someone will wait for a direct offer and frustration that the information provided about waiting times may not be accurate.

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The Ombudsman’s role and powers

2. We may investigate matters coming to our attention during an investigation, if we consider that a member of the public who has not complained may have suffered an injustice as a result. (Local Government Act 1974, section 26D and 34E, as amended)
3. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word ‘fault’ to refer to these. If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended
4. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

5. While investigating a complaint about the Council’s failure to update a change of circumstances on its housing register, issues about how the Council was operating direct offers came to our attention. We considered this could be affecting people who had not made a complaint and so decided to investigate.
6. I made enquiries of the Council and considered the comments and documents it provided. I also discussed the issues with Council officers via a videocall.
7. I sent the Council a copy of my draft decision and took account of its comments in reaching my final decision.

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What I found

8. The Council has a lettings policy for social rented homes. The policy came into effect on 1 October 2021. It sets out the criteria and procedures for allocating homes to people on the Council’s housing register and the legal context in which the scheme must operate.
9. The lettings policy sets out the criteria for inclusion on the housing register and the priority that each application is given. Each applicant is placed into one of four bands depending on their circumstances and then given an “effective date” to prioritise within each band. Once accepted onto the housing register, applicants can then “bid” on available properties that meet their assessed housing needs. The bidder with the highest band and earliest effective date will be offered the property.
10. The new policy introduced in October 2021 affected how long some applicants would have to wait for a property. For example, a family requiring a three bedroom property would previously have been on the waiting list for about two years. After October 2021, this wait could be up to nine years.
11. Band A is for emergency cases where people are unable to return to their homes. The Council says that very few applicants are actually placed in Band A and they will quickly be given a direct offer in order to alleviate the housing issues. The Council says it takes this approach because bidding behaviours often don’t reflect the urgency of the housing need.
12. The lettings policy also allows the Council to make a direct offer to any household on the housing register at any time. An appendix to the lettings policy sets out the circumstances in which it is appropriate to make a direct offer outside of the choice based lettings process. Applicants are categorised by bedroom need and will be placed on the direct offer list in order of when the request was agreed.
13. Direct offers can be made to the following:
• Statutory homeless applicants who are occupying temporary accommodation for which the lease is due to expire, have refused a previous suitable offer or have failed to attend a viewing;
• Emergency cases eg fire, flood, police witnesses, hospital discharge;
• Social priority eg fleeing domestic abuse or gang related matters;
• Temporary and permanent decants due to disrepair issues;
• If ordered by a judge following a judicial review; and
• Where, due to an administrative error, someone has not received an offer of housing.
14. Decisions are made by the exceptional case panel which is made up of senior council officers. They meet at least monthly and notify applicants of the decision within 10 working days. There is no right of appeal against decisions made by the exceptional case panel but a case can be resubmitted if additional evidence is available.
15. When I made enquiries about this matter there were 343 households waiting for a direct offer. 80 new applicants were added to the list during 2022 and 146 direct offers were made. During 2022, 545 properties were allocated as choice based lettings.
16. Of the 146 properties given as a direct offer, 77% were one bedroom properties. The Council says that all properties are first advertised on its choice based lettings system. Where there are no bidders or a property has been refused, it will then be considered whether it is appropriate for a direct offer. The Council also uses its discretion to decide when a property would be suitable to be a direct offer. It will take account of various factors including how many properties it is advertising that week. It will still advertise the property it intends to use as a direct let but will indicate this is its intention.

Analysis

17. It is not fault for the Council to make direct offers but there should be a fair and transparent procedure for doing this. The information provided shows there is provision within the lettings policy for direct offers to be made. If an applicant is given Band A priority the Council will make them a direct offer. Based on the information provided by the Council this is a very small number of applicants.
18. Appendix three of the lettings policy sets out the circumstances in which applicants are given a direct offer, how the decision is made and who makes the decision. When read as a whole, the policy and the appendices, provides an explanation of how the Council handles allocations including direct offers. However, when investigating this complaint, I used the Council’s website to read its Lettings Policy. While the policy is available to read online the appendices referred to in that policy are not. This is fault.
19. In order to properly understand how the policy works, it is necessary to read the appendices. This is especially relevant to this complaint as the only way to know how a direct offer is agreed is to read the relevant appendix. The policy document, if read without the appendices, is confusing because the only reference to direct offers in for applications in Band A. The lettings policy has been in operation since October 2021 and so information about how it operates has not been available in an accessible format to applicants since that time.
20. There are a variety of reasons why residents are made a direct offer. In this case the Council also includes tenants who are suitably accommodated but who need to move, either temporarily or permanently, often due to repair issues. These tenants are included on the direct offer list as part of the Council’s lettings policy even though they have not made an application to be on the housing register. The Council may be confusing matters by including this category of tenants on the direct offer list rather than dealing with them as management moves. When a move is a temporary decant, the tenant will move back to the original property once it is repaired and so the second property will then be available to be advertised on the choice based lettings system. The inclusion of temporary decants on the direct offer list may be causing unnecessary confusion.
21. How the Council determines what properties will be used as direct offers is not clear. The Council should use its discretion in order to find the best use for its limited housing resources to ensure it provides housing to those with the greatest housing needs. However, the Council has been unable to provide any clear explanation of how it decides what property will be used for a direct let. Even where the Council is using its discretion, it is advisable to have some guidance to show how this discretion should be applied to ensure an open and transparent and consistent process.
22. If decisions about how many and what type of properties are offered to those on the direct offer list are left to chance, there is no way to know how long someone will have to wait for a property. I acknowledge that they are still able to place bids on all available properties but the purpose of a direct offer is to meet an exceptional need and to rehouse them sooner than the choice based lettings process.
23. A direct offer is agreed in the majority of cases to recognise exceptional circumstances. By agreeing a direct offer the Council indicates it is willing to allocate a property “out of turn”. However, it then orders the direct offer list only by the date the direct offer was agreed and does not take into account the exceptional circumstances of the tenant including when they arose. This gives the impression the direct offer list is prioritised less fairly and it is not clear why the Council has chosen to do this.
24. I take the view that the current process in respect of direct offers is not entirely clear and there is a lack of clarity and transparency. There seems to be some overlap between what qualifies an applicant for Band A and what circumstances would lead to someone staying in Band B and being added to the direct offer list. It is not clear how the Council decides when a situation warrants Band A priority and when it is less urgent but warrants an allocation “out of turn”. This adds avoidable uncertainty to the process and raises the tenants’ expectations in respect of when a suitable offer will be made. The Council should provide more information to applicants when they are put on the direct offer list so that they can make informed decisions about their housing situation.

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Agreed action

25. The Ombudsman has the power to make recommendations to remedy the injustice experienced by complainants and members of the public affected by fault we identify. (Local Government Act 1974 31 (2B)). I have set out below the actions the Council will take to remedy the injustice caused to those people who are also affected by the Council’s fault. I have also recommended service improvements to prevent the fault causing injustice to other in the future.
26. The Council should, within three months of my final decision, take the following action:
• Write to all applicants currently on the direct offer list advising them of the number of residents on the list with similar bedroom requirements and details of the number of properties of that type it let in the previous year. This will give applicants a better understanding of their wait time;
• Produce guidance setting out how it will use its discretion to determine which properties are offered to applicants on the direct offers list.
• Review how it operates the direct offer waiting list to ensure prioritisation of the list is based on whether the available property meets the specific needs of applicants and, where more than one applicant on the direct offer list matches the property, it will make the offer based on priority band and then band date;
• Consider whether it is appropriate to include tenants requiring a temporary decant on this direct offer list or whether they should be dealt with separately as management moves; and
• Update the website to include all the appendices for the lettings policy.
27. The Council should provide us with evidence it has complied with the above actions.

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Final decision

28. I have completed my investigation with a finding of fault for the reasons explained in this statement. The Council has agreed to implement the actions I have recommended. These appropriately remedy any injustice caused by fault.

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Investigator's decision on behalf of the Ombudsman