Rent, service charges and how to pay - Plymouth Community Homes

Rent, service charges and how to pay

Contents
How to pay 3
The Direct Debit payment incentive scheme 4
Your rent and how it is calculated 6
The target rent calculation 7
Frequently asked questions about your rent 8
Service charges 11
Frequently asked questions about your service charges 12
Example of a service charge statement 18
A guide to your statement 19
Contact details 23

How to pay
How is my rent charged?
Your rent is charged on a weekly
basis and is due weekly in advance.
You can pay weekly, fortnightly or
monthly. If you choose to pay
fortnightly, your payment will need
to be for the current week and week
following. We check your account at
the end of each week.
Your account will need to be kept up
to date however you choose to pay.
How can I pay my rent?
There are a number of ways you
can pay your rent:
• By Direct Debit
Direct Debit is a safe and easy
way to pay. If you set up a Direct
Debit then you are protected by
the Direct Debit Guarantee. You
can pay weekly, fortnightly, four
weekly or monthly on any date
you choose. These payments
should be made in advance in line
with the terms of your tenancy
agreement. (Plymouth Community
Homes is offering an incentive if
you choose this option – see
page 4.)
• Using a debit or credit card
You can pay over the telephone,
24 hours a day, every day, by
telephoning 0844 557 8321. This
service is operated by “Allpay” and
you will need to tell the operator
the 19 digit number that appears
across the middle of your payment
card.
• Online
You can pay online at the
Plymouth Community Homes
website. Just click on ʻpay your
rentʼ and you will be directed to
the ʻAllpayʼ payment site
https://www.allpayments.net/
allpayments/. You will need to
enter the 19 digit number that
appears across the middle of
your payment card.
• By text
Once you have completed the
simple 4 step registration process
online at:
https://www.allpayments.net/
textpay/logon.aspx then simply
pay by texting “pay” and the text
code, along with the amount you
want to pay and your password to
81025. You will receive a
confirmation text message that we
recommend you keep. The only
cost is the standard text message
fee which may be charged by your
phone provider.
3

• In cash
You can make a
cash payment at
any outlet
displaying the
PayPoint sign.
• By cash or cheque
You can pay by cash or cheque
at any post office.
How will I know you have
received my payments?
Statements are sent out four times
a year showing your payments,
charges and account balance;
however an interim statement can be
provided on request from your local
housing office. You can also get an
account balance over the phone by
calling your local housing office.
What if I lose my payment card?
You can request a new payment
card by contacting your local
housing office (see page 23).
How do I set up a Direct Debit?
• We can set up your Direct Debit
over the telephone – just contact
your local housing office. Contact
numbers are listed on page 23.
• If you would like to set up your
Direct Debit by completing a form
rather than over the phone you
can obtain a mandate form from
any local housing office.
• You can set up your Direct Debit
to pay your rent and service
charges – weekly, fortnightly, four
weekly, and monthly on any
date(s) you choose.
• If you sign up to pay by Direct
Debit you will receive a £10
voucher and if you keep your
Direct Debit payments going for
12 months we will send you a £20
voucher in April 2013.
• Free Quarterly Prize Draw –
everyone paying by Direct Debit
for three months has a chance of
winning £100 worth of vouchers.
Iʼm an existing Direct Debit
customer. Will I get a voucher?
Yes. We want to show our
appreciation so if you keep paying
your rent by Direct Debit for the
whole year we will send you a £30
voucher in April 2013.
Why are we offering an incentive
to sign up to Direct Debit?
Direct Debits are the most efficient
way for you to pay your rent and
service charges. It is also the safest
and most cost effective method for
Plymouth Community Homes to
take payments. The efficiency gains
from not handling cash can then be
reinvested into the services we can
offer to our tenants.
4

Rent
5

How is my rent calculated?
The rent you pay is a payment for
your home.
The amount of rent you pay is based
on a government formula which will
gradually move your rent towards a
ʻtarget rentʼ for your property. This
means that by 2016 you will be
paying broadly the same amount (for
the same type of property, number
of bedrooms, location) as other
social housing properties in the area.
The ʻtarget rentʼ for your property is
shown in the letter you received with
this booklet.
How do we work out the target
rent?
Every individual property that we
rent out has a ʻtarget rentʼ, which is
worked out using a formula. The
rules say that all properties must
reach this ʻtarget rentʼ by 2016.
Some rents will have to go up to
reach this target, some will have to
go down.
The formula factors that we take into
account in the calculation of target
rents are shown here:
• The average wage in Devon
(1999)
We compare the average wage in
Devon of £278 per week with the
national average wage £316.40,
using information given to us by
the government (using wages for
the year 1999).
• How much your home is worth
(1999)
We compare the value of your
home with the value of the
average housing association
property in the country. Property
values were based on the value
of the property, but at January
1999 values to ensure
consistency.
• The national average rent
for the housing association sector
in 2011/12 is £86.58 per week
based on a 50 week rent year.
• The number of bedrooms in
your home
The more bedrooms in your home,
the higher your rent will be.
No of Bedrooms Weighting
Bedsits 0.8
1 0.9
2 1
3 1.1
4 1.2
5 1.3
6+ 1.4
6

The target rent calculation is as
follows:
Property element
(30% of the average rent
for the Housing Association
Sector x relative property
value)
+ Earnings element
(70% of the average rent
for the Housing Association
Sector x relative county
earnings x bedroom weight)
=
Target rent
Example
For example, an associationʼs
three-bedroom property in Plymouth
valued at £27,000 in 1999 would
now have its target rent calculated
as follows:
Property element
30% of sector-average rent:
30% x £86.58 £25.97
multiplied by relative property value
£27,000 / £49,750 x 0.54
Add together the two sub-totals
Property element £14.02
Earnings element + £58.67
Target rent 2012/13 £72.69
This means that by 2016 you will be
paying broadly the same amount for
the same type of property, number
of bedrooms and location as other
social housing properties in the area.
sub-total £14.02
Earnings element
70% of sector-average rent:
70% x £86.58 £60.61
multiplied by relative county earnings
£278.00 / £316.40 x 0.88
multiplied by bedroom
weight for a 3 bed house x 1.1
sub-total £58.67
7

Will my rent go up suddenly by a
large amount?
Because the changes are being
made over a period of at least 16
years, any rent change (up or down)
should be gradual. To make sure
tenants donʼt face large increases,
government policy states that, in
any one year, a tenantʼs weekly rent
cannot go up by more than the
Retail Price Index (RPI) plus 0.5%,
plus £2. After target rents have been
reached in 2016, rents will then only
increase by RPI + 0.5%, which
follows current government policy.
Will new tenants pay target rent
from the start of the tenancy?
New tenants pay the target rent for
their home from the start of their
tenancy plus any applicable service
charge. New tenants are those who
became tenants of Plymouth
Community Homes after the transfer.
(Note: this will exclude new
properties developed as part of the
future redevelopment of North
Prospect where different
arrangements are in place.)
What if my rent needs to go
down?
If your rent is above the level it needs
to be, it wonʼt drop to the new level
immediately. Your rent will either fall
slowly, or go up by less than the
rate of inflation, so that Plymouth
Community Homes can keep
providing a good level of service.
What if my rent is at target rent?
Where a property has been let at the
target rent, annual increases will be
limited to no more than the annual
Retail Price Index plus 0.5%.
How do Plymouth Community
Homesʼ rents compare with other
housing associations?
On average, Plymouth Community
Homesʼ rents are the 2nd lowest in
the country, while, in Plymouth, our
rents are, on average, £7 per week
lower than the other housing
associations.
8

When are the rent free weeks?
We ask you to pay your rent for the
whole year over 50 weeks rather
than 52. The ʻrent-free weeksʼ will be
the weeks starting the 2 April and 24
December 2012.
If you are in arrears of rent, have a
court order, or another arrangement
to clear arrears, you will still be
expected to make payments during
these weeks.
If you pay your rent by Direct Debit
monthly then the rent for the year is
paid in 12 equal instalments. The
amount you pay for the full year will
be the same as paying by other
payment methods.
9

How do I apply for Housing
Benefit?
If you have a low income and do not
get any help to pay your rent at
present, you may be entitled to
Housing Benefit. You can get an
application form from any housing
office, or from the city council
Housing Benefit Office in the Civic
Centre.
Even if you have applied for help to
pay your rent before, but did not
qualify for Housing Benefit, it is
worthwhile applying again. If you
wish to make a claim, you will need
to provide proof of your identity,
income and savings – you can bring
this, with your application, to your
local housing office for checking.
I am receiving Housing Benefit.
Do I need to reapply?
IF YOU RECEIVE HOUSING
BENEFIT NOW, YOU DO NOT
NEED TO REAPPLY.
You will receive a letter from the
Housing Benefits office that will give
details of your new benefit
entitlement and the revised amount
you should pay each week.
What if I fall behind with my rent
or service charges?
If you are having difficulty in paying
your rent, please contact your
housing officer as soon as possible.
Do not ignore it. The problem will
only become worse. Our staff will do
their best to help you and provide
advice.
IT IS VERY IMPORTANT NOT TO
IGNORE LETTERS SENT TO YOU.
10

Service charges
11

What is a service charge?
A service charge is a charge we
make for services we provide to
your block or to your home that is
not covered by the rent. It covers
communal services and in some
cases individual services such as
heating and hot water.
What is a support charge?
A support charge is for anyone living
in sheltered accommodation or a
bungalow with an emergency call-out
alarm fitted. This is a service to older
and disabled tenants who may need
support to maintain their tenancy. If
you are eligible for Housing Benefit
for your rent, the charge will be
covered by the councilʼs Supporting
People funding. Your rent letter will
make this clear if this is the case. If
not then you will need to pay the
charge.
12

What are variable service charges
and how do they work?
Plymouth Community Homes
operates a variable service charge
system. This means we will only
charge you an amount to cover the
full cost of services you receive. For
more information please refer to the
service charge leaflet within your
Tenantsʼ Handbook.
Why are you sending out a
service charge statement?
By law, if we charge you a variable
service charge we have to make an
adjustment when we know the actual
cost of the services. We want to be
open and transparent with you about
these costs and the adjustment.
We have tried to keep this
information as simple as possible
but if you have questions then
please contact us.
I donʼt understand the statement
you have sent me. What does it
mean?
The service charge statement shows
you the difference between the
actual cost of the services compared
to what we originally estimated for
the period October 2010 to
September 2011. We then either add
to, or deduct from, the estimated cost
of services for the forthcoming year
starting April 2012 to give you your
new service charge. More details
are explained on pages 18-22.
When will I receive these charges?
Together with your rent letter you
will also receive a service charge
statement. This covers the
adjustments relating to the previous
period (October to the following
September) together with the
estimate from April for the
forthcoming year.
All annual charges will start in April
unless a new service is introduced
during the year.
13

Service charges – flow chart for
working out your service charge
and any adjustments
1
Oct to Nov
We ʻlook backʼ at the costs for the 12
months until September and compare
what was charged to what it actually
cost to deliver the services.
Then we know if thereʼs any
adjustment needed.
2
Dec to Jan
We now work out next yearʼs
estimate for the cost of the
services.
3
Feb to Mar this year
We add the difference from 1 to the
estimate at 2 to give a total charge.
You should receive this by the 1st of
April each year.
14

How do I know what my Housing
Benefit allowance will cover?
Communal services are covered by
Housing Benefit so these are any
services that are available within the
block once you step out of your front
door. Individual services not covered
by Housing Benefit are water and
heating that you have within your
home – once you shut your front
door.
My tenancy started in August
2011. Why am I paying a higher
service charge than my
neighbours who have been
tenants for a number of years?
We reviewed all our service charges
last year. New tenants since then are
charged for their share of the cost of
the services provided to their block
and would have signed their tenancy
agreement accepting the service
charge. Long-standing tenants, in
some cases, would have been faced
with significant increases following
our review. It was agreed by the
Plymouth Community Homes Board
to phase in the increases for these
tenants over a number of years.
Eventually all tenants will pay the
same and any new tenants in your
block will automatically pay the same
as you.
Communal charges can include:
• Caretaking
• Cleaning of communal areas
• Laundries
• Door entry
• Lift maintenance
• Fire alarms
• Grounds and gardens
• Maintenance in communal areas
• Heating and lighting in communal
areas
• Communal TV aerials
• Plant and specialist equipment
• Others may apply
We aim to provide services in the
most reasonable and cost-effective
way and to a standard acceptable to
you, our residents. We are moving
towards a fairer charge, which would
reflect the real costs of providing the
services.
15

I have been a tenant for many
years and can see the service
charge I have to pay has been
reduced from what it should have
been. Why has it been reduced
and how long will this last?
Last year we explained about the
review of the charges we had
undertaken. This meant in some
cases the charges would have
increased significantly. The Board
recognised that any large increase
would have been difficult for tenants
and decided to phase in the increase
over a number of years for residents
whose tenancy started before April
2011. This year we are continuing to
limit the increases and give a
reduction on the overall service
charges. We call this the
affordability cap.
So how does the affordability cap
work?
We have worked out a charge to
make it affordable and have adjusted
the total service charge so it does
not exceed this amount. We have
adjusted the charge so it does not
rise annually by more than inflation
(using the Retail Price Index + 0.5%
+ 50p) compared to what you paid
per week in March 2011.
The cap does not apply to any new
tenants of Plymouth Community
Homes who started their tenancy
after March 2011, as they will pay
the full cost of the service.
The charge for the lift in my block
and the door entry system is
much higher than last year. Why
is this?
We charge for repairs that have been
carried out and itʼs difficult for us to
estimate in advance how much this
might cost as breakdowns can
happen at any time. Sometimes the
costs are higher than we originally
estimated.
My laundry and lighting charge is
higher than last year. Why is this?
The cost of gas and electricity has
increased significantly over the
year. In recent years, energy costs
have been difficult to predict and
utility prices have continued to rise
above the rate of inflation.
What is a management and
administration charge?
There is a cost in running and
managing the services provided to
your block. These costs need to be
met by tenants and leaseholders
who receive the services.
The charge covers the administration
needed to manage all the services,
such as calculating the charges and
adjustments, managing the
contracts, making payments to our
providers, providing information and
consulting with residents. It is
charged at 13p per week per service.
It is based on the number of services
you receive but will not exceed 15%
of the total cost of service charges.
16

I am in a block but I know
someone in another block who
pays a different amount for the
same service, why is this?
Each block, however similar, will
have costs that can vary or have a
different number of flats. For
example, one block may have more
flats than another so the costs are
spread among more residents. This
makes the cost per resident lower.
Some services may vary between
blocks such as the area of grounds
to be maintained or the time taken
to clean the courtyard because of
the size.
I am on the ground floor. Why
should I pay for a lift?
The lift is one of the services to
which everyone in the block has
access. Whether you choose to use
it or not, it is accepted that all
residents should share the cost of
communal services.
I donʼt use the laundry. Why
should I pay for it?
The laundry is available to all tenants
in the block(s) as a communal
service so whether you choose to
use it or not, it is a service you share
and pay towards.
The door entry system on our
block is vandalised a lot. Why
should I pay towards this?
If it is out of action for long periods
you will not be charged for these
periods. You will need to report this
to our repairs section so we can take
action and record this. The repairs
freephone number is 08082 306500.
I cannot see that our windows
are cleaned or our grounds are
maintained. Why should I pay?
The contractors we use may come
at times that you are away from
your home so you may not see the
service provided. We do require
contractors to inform the caretaker
or a resident that the service has
been provided so this can be
checked. We will not charge you if
the service has not been provided.
If you still feel the service has not
been provided but you have been
charged, we will investigate and if
this proves to be the case then we
will reduce your charge.
Will I get a refund if I am owed
money for the period October
2010 to September 2011?
Any money owed to you will be
taken into account by reducing your
service charge starting in April 2012.
17

An example of a Plymouth Community
Homes service charge statement
The figures shown are for illustration only.
Address:
Tenant Name:
The table below is your statement showing what we estimated the cost of services would be compared
to the actual cost of those services for the period October 2010 to September 2011. The difference
between these two figures is then either added to, or deducted from, the estimated cost of services
for the year starting in April to arrive at your new weekly charge. More information is contained in the
enclosed booklet.
Difference between actual cost and what you
New Service Charge
were charged between Oct 10 and Sept 11 April 2012 to March 2013
A B C D E F
What the What we Difference Estimated Annual Weekly charge
services estimated the (A - B) cost of charge payable
SERVICES actually cost services Services (C + D) (E divided by
would cost
50 weeks)
Communal Services
Caretaking service £80.00 £100.00 -£20.00 £160.00 £140.00 £2.80
Laundries £80.00 £60.00 £20.00 £160.00 £180.00 £3.60
Communal Window Cleaning £10.00 £15.00 -£5.00 £20.00 £15.00 £0.30
Refuse Bin Cleaning £7.00 £3.50 £3.50 £14.00 £17.50 £0.35
Plant & Specialist Equipment £25.00 £17.00 £8.00 £50.00 £58.00 £1.16
TV Aerials, satellite dishes £15.00 £24.00 -£9.00 £30.00 £21.00 £0.42
Door Entry System £20.00 £10.00 £10.00 £40.00 £50.00 £1.00
Communal Lighting £12.00 £10.00 £2.00 £24.00 £26.00 £0.52
Grounds Maintenance £30.00 £40.00 -£10.00 £60.00 £50.00 £1.00
Management Charge £41.85 £41.93 -£0.08 £71.00 £70.92 £1.42
£320.85 £321.43 -£0.58 £629.00 £628.42 £12.57
Individual Services
Heating & Hot Water £30.00 £25.00 £5.00 £60.00 £65.00 £1.30
Water Rates / Meter £10.00 £12.00 -£2.00 £20.00 £18.00 £0.36
£40.00 £37.00 £3.00 £80.00 £83.00 £1.66
Grand Total £360.85 £358.43 £2.42 £709.00 £711.42 £14.23
Affordability Cap - adjustment to your charge this year £0.00
Your weekly service charge payble from April = £14.23
18

A guide to your
Service Charge statement
Under the terms of your Plymouth Community Homes tenancy agreement, we
will send you a statement each year that details the services we provide to
you. Your service charges are variable and your tenancy agreement explains
what this means.
We hope the guide below will be of help when you look at your statement. We
have listed the information by the column heading you will find at the top of
your statement.
SERVICES
These are the services that you
receive according to our records. If
you want to know more about these
services then refer to the booklet
ʻService Chargesʼ within your
Tenants Handbook. The services
are split in two types:
ʻCommunal Servicesʼ are services
that are available within the shared
areas of your block – the services
available to you once you step out
of your front door.
ʻIndividual Servicesʼ are those you
receive once you shut your front
door. For these services we only
pass on the actual cost to you, such
as your share of the cost of gas if
you have heating from a communal
boiler.
ʻManagement Chargeʼ
This charge covers the cost of
managing the services provided to
you and administering service
charge accounts and records. This
management charge is a flat fee of
13p per service per week, but you
will not be charged more than 15%
of the total service charge.
If you are being charged for a
service you donʼt think you are
receiving then please contact us on
0800 012 1474.
19

Column A
What the services actually cost
This column tells you how much the
services actually cost between
October 2010 and September 2011.
We have checked our accounts and
worked out your share of the cost for
the block you live in. This is based
on how many flats there are in your
block – so the total cost is divided by
the number of flats to give you your
share of the cost. We also add any
costs that are “individual services” to
your flat, such as water or communal
heating. We then add up all the costs
to come up with a grand total.
Column B
What we estimated the services
would cost
This tells you how much we
estimated the services would cost
between October 2010 and
September 2011.
Column C
Difference
We now take the amount in column
A away from the amount in column
B to show the difference between
what we estimated and what you
should have paid.
20

If the difference is a positive figure,
displayed like this: £5.00, then this is
the amount you owe us. If the figure
is a negative figure, displayed like
this: -£5.00, then this is the amount
we owe you. The figures in the
column are added up to come up
with a total.
Column D
Estimated cost of Services
This is our best estimate of what the
services will cost in the coming year,
starting in April 2012.
Column E
Annual Charge
This adds together the Estimated
Cost of Services (Column D), plus
or minus the difference from the last
12 months (Column C), to give the
annual service charge for the coming
year.
Column F
Weekly charge payable
As you pay your rent and service
charges over 50 weeks we divide
column E by 50 weeks to give a
weekly charge. These figures are
the same as the ones shown on
your main rent notification letter.
21

At the bottom of the statement
Affordability Cap
(adjustment to your total charge
for this year)
In March last year we explained that
we had undertaken a review of all
the service charges. This meant in
some cases the charges would
have increased significantly. The
Plymouth Community Homes board
recognised that any large increase
would have been difficult for
residents to pay and agreed to phase
in the increase over a number of
years for those tenancies that started
before April 2011. Where residents
currently pay less than the full cost
of the services provided to a block
(see column A in your statement),
we will continue to steadily phase in
the increase whilst at the same time
ensuring the charge does not
exceed a certain level – we call this
the affordability cap.
The affordability cap is based on
the weekly service charge you were
paying back in March 2011. We
steadily increase this cap each year
and the charge you have to pay then
follows this increase and keeps it
affordable.
Toward the bottom of your statement
you will see the affordability cap
adjustment, for most residents this
is shown as a reduction to the
service charge.
For some other residents the
adjustment is shown as an additional
amount. This is where we reduced
your charge last year because we
estimated that the cost of services
would have exceeded the
affordability cap. But we now know
the actual cost of those services
came in less than we estimated. In
other words we reduced the charge
you paid last year by too much. For
those residents affected by this,
your charge this year (including the
adjustment) will still not exceed the
affordability cap so you are still
protected.
You will be able to see how this
affects you by checking your service
charge statement. If you want to
know more information about the
affordability cap and how it works
then please contact us.
The affordability cap does not apply
to any new tenants of Plymouth
Community Homes who started their
tenancy after March 2011, as those
residents would have signed their
tenancy agreement accepting the
full cost of the services listed.
Queries about your statement
If you have any other queries that
are not covered in the content of
this booklet, then please contact us
on 0800 012 1474 and we will be
pleased to help.
22

Contacting Us
Plymouth Community Homes
Head Office
Princess Court
23 Princess Street
Plymouth
PL1 2EX Tel: 0800 012 1474
Whitleigh Housing Office
101 Whitleigh Green
Whitleigh
Plymouth
PL5 4DE Tel: 0800 917 9498
North Prospect Housing Office
91-93 North Prospect Road
North Prospect
Plymouth
PL2 2NA Tel: 0800 917 9499
Estover Housing Office
Leypark Walk
Estover
Plymouth
PL6 8UE Tel: 0800 917 9496
Devonport Housing Office
10-12 Granby Way
Devonport
Plymouth
PL1 4AB Tel: 0800 917 9497
23

Plymouth Community Homes
Princess Court
23 Princess Street
Plymouth PL1 2EX
Telephone: 0800 694 3101
Email: info@plymouthcommunityhomes.co.uk
Web: www.plymouthcommunityhomes.co.uk
Registered Office: Ground Floor, Princess Court,
23 Princess Street, Plymouth, PL1 2EX
Charitable Industrial and Provident Society Registration No: 30637R