Ombudsman investigation calls on London borough to review approach to direct offers and boost transparency

An investigation by the Local Government and Social Care Ombudsman (LGSCO) has found that the London Borough of Hackney has a clear process showing how applicants are accepted onto its social housing direct offer list but follows a “random, discretionary process” to determine which properties are offered to these applicants.

In its report, the LGSCO urged the council to review how it operates its direct offer waiting list, to “ensure prioritisation of the list is based on whether the available property meets the specific needs of applicants”.

Outlining the background to the investigation, the Ombudsman said that the council has a lettings policy for social rented homes, which came into effect on 1 October 2021.

The 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”, said the Ombudsman.

Band A is for emergency cases where people are unable to return to their homes. The council said that “very few applicants” are placed in Band A and they will “quickly be given a direct offer in order to alleviate the housing issues”, the Ombudsman revealed.

The lettings policy allows the council to make a direct offer to “any household on the housing register at any time”, the report notes.

The report added that 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.

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.

The Ombudsman’s investigation found that decisions are made by an “exceptional case panel” which is made up of senior council officers. The report noted that 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”.

Following enquiries, the Ombudsman found that 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, the report revealed.

The council told the Ombudsman 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”, said the report.

Looking into the process, the Ombudsman found that the council “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”, the report revealed.

Analysing this process, the Ombudsman found that while it is not fault for the council to make direct offers, “there should be a fair and transparent procedure for doing this”.

The report noted that when read as a whole, the council’s lettings policy and the appendices provide an explanation of how the council handles allocations including direct offers.

However, the Ombudsman found that while the policy is available to read online, the appendices referred to in that policy are not. He concluded that this was fault.

The investigation also found that the council has been “unable to provide any clear explanation of how it decides what property will be used for a direct let”.

The Ombudsman concluded: “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’.”

The report added: “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.”

To remedy the injustice caused, Hackney has been recommended to 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.

According to the Ombudsman, the council has agreed to implement the recommended actions.

Cllr Sade Etti, Hackney’s Deputy Cabinet Member for Housing Needs and Homelessness, said: “Hackney is facing a housing crisis. We have over 8,500 households waiting for a council home with fewer than 500 homes becoming available every year. In 2021 we simplified our housing waiting list to ensure that those in the greatest need, such as families who are suffering from severe overcrowding or are statutorily homeless, remain on the list and others who are unlikely to get a council home get bespoke advice to help them find suitable housing.

“Sometimes we need to make offers outside the waiting list if there is a very urgent need - like a flood or a threat to someone’s life. These offers are decided by a panel of senior council officers. The direct offers we are able to make depend on often complex individual circumstances and the housing that is available, but we accept the Ombudsman’s findings that the process by which we decide to make a direct offer should be made more transparent and we are implementing the recommendations.

“Examples of where we have made direct offers include families with children who have very severe medical needs, wheelchair bound residents living in seriously overcrowded housing, and tenants who have succeeded to a tenancy for a home that is much larger than their needs - which allows us to make a much-needed family home available for other residents on our housing register.”

Lottie Winson