ca111 rent deposit guarantee scheme

ca111 rent deposit guarantee scheme

STIRLING COUNCILTHIS REPORT RELATESTO ITEMON THE AGENDACARE COMMITTEEHOUSING AND SOCIALSERVICES19 November 1998 NOT EXEMPTRENT DEPOSIT GUARANTEE SCHEME1 PURPOSE1.1 To establish a Rent Deposit Guarantee Scheme in partnership with theCowane’s Trust2 SUMMARY2.1 This report outlines the need for a Rent Deposit Guarantee Scheme in theStirling area and details how such a scheme would operate in practice. Itconsiders qualification criteria for prospective tenants and landlords and thesafeguards required to prevent abuse of the scheme. Finally it considers theoperation of the partnership arrangement with the Cowane’s Trust includingthe referral mechanisms.2.2 The Report refers to the access opportunity to be created for homelesspersons who have limited housing options. The operation of the Schemeessentially requires Stirling Council to operate referrals, which can be coordinatedthrough funding obtained via Rough Sleepers Initiative.3 RECOMMENDATION3.1 To agree to establish , in partnership with the Cowane’s Trust , a Rent DepositGuarantee Scheme4 CONSIDERATIONS4.1 At it’s meeting of 24 March 1998 , the Cowane’s Trust agreed in principle toestablish a Rent Deposit Guarantee Scheme in partnership with StirlingCouncil. The Trust have identified sufficient funds to underwrite the proposedScheme.

-2-4.2 The Council has a statutory duty under the Housing (Scotland) Act 1987 part2, to provide advice and assistance to homeless households who are not inpriority need for accommodation.4.3 Part of this advice and assistance is to consider options within the privaterented sector. However many persons in such circumstances do not havethe financial means to pay rent in advance or a deposit as is commonlyrequired by landlords.4.4 A Rent Deposit Guarantee Scheme can overcome this prepayment restrictionon access to private rented accommodation by providing landlords with alimited guarantee that any rent loss or cost arising from damage to theirproperty would be met from the Scheme’s fund on submission of a claimwhich would be verified prior to payment. The applicant \ tenant will be heldliable to the Scheme for any successful claim against it’s guarantee.4.5 The Guarantee would cover a maximum of four weeks unpaid eligible rent. Itis anticipated that , as Housing Benefit will normally cover the rental , there willbe minimal claims on the scheme in this respect. This will however encouragelandlords to accept people on income support as tenants, where many arecurrently excluded.4.6 Applicants to the Scheme will be homeless and have a local connection asdefined in the Housing (Scotland) Act 1987 , Pt. 11. All other housing optionswill have been considered. The Scheme is intended to assist those whocannot obtain accommodation by any other route and will not be used to ‘fasttrack’ or circumvent other possibilities.4.7 Landlords will only be considered for inclusion in the Scheme where theirproperty complies with the relevant legislative standards and where there is noknown record of harassment or illegal eviction of tenants or of any financialirregularity.4.8 The property will be the subject of a full inventory of contents and conditionprior to commencement of tenancy to assist in the scrutiny of any subsequentclaim and to ensure that quality standards are maintained.4.9 It is anticipated that the Rough Sleepers Services Development Worker willadminister the Scheme and will provide the assessment and referral linkbetween the Council and the Trust.4.10 If agreed , a corporate identity will be created for the joint venture and alaunch would be anticipated in January 1999.5 POLICY IMPLICATIONS5.1 The Scheme fits with the objective contained in the Housing ManagementPlan : Homelessness Strategic objective 2 - Focus on action to preventhomelessness.5.2 This Scheme will also fulfil the Councils’ Aim of Social Inclusion.

-3-6 CONSULTATIONS6.1 Shelter Scotland stated that a Rent Deposit Guarantee Scheme would bebroadly welcome as an enhancement to existing provision.6.2 C.A.B. Stirling stated that they wholeheartedly endorse such a Scheme in theStirling area.7 RESOURCE IMPLICATIONS7.1 None. Rough Sleepers Services Development Worker post has been fundedfor eighteen months by successful bid under Rough Sleepers Initiative.Cowane’s Trust will underwrite the Guarantee.8 BACKGROUND PAPERS8.1 None.

-4-Author(s)Name Designation Tel No/ExtensionDavid Bright Area Manager 432231Approved byName Designation SignatureJill PrestonDirector of Housing & SocialServicesDateReferenceCOMMITT.DOC

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