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8:01 AM, 22nd September 2022, About 2 years ago 18
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Landlords will have to pass on a £400 energy rebate to their tenants who are paying rent with their bills included, the government has revealed.
The move is part of the government’s help to deal with soaring energy bills and various charities have voiced concerns that for renters who have energy bills included in their rent would miss out because the energy rebate will be paid to the landlord.
Now, the government says it is prepared to force through legislation that will compel landlords to pass on the energy rebate to their tenants.
The Government announcement on the energy bill rebate for all-inclusive tenants, states:
Your landlord may charge an ‘all inclusive’ rent, where a fixed cost for energy usage is included in your rental charges, in which case:
Charities have welcomed the news with Gillian Cooper, the head of energy policy for Citizens Advice, saying: “We’re relieved to see the government bring in measures to make sure people don’t miss out on money they’re entitled to.
“But it’s still shaping up to be an incredibly difficult winter and the government must be ready to provide more support for families struggling the most.”
Responding to news that the Government plans to legislate to ensure landlords pass on the Energy Bills Support Scheme discount to tenants paying all-inclusive rents, Chris Norris, the policy director for the National Residential Landlords Association, said: “Given payments under the support scheme have not begun to be made, the Government’s plans to legislate are premature and are demonising landlords unnecessarily.
“It sends a dangerous and misleading message that landlords cannot be trusted to do the right thing, creating needless fear and anxiety for tenants.”
He added: “The reality is that one-off pots of money like this cannot compensate for the fact that the benefits system is systematically failing to protect the most vulnerable tenants.
“At a time when households finances are being squeezed it makes no sense to have frozen housing benefit rates.”
The NRLA says it is also calling for a long-term plan to help landlords introduce energy efficiency measures.
However, it’s unlikely that any legislation will be passed before October, because Parliament will be in recess from Friday for the Conservative and Labour party conferences.
It’s still unclear whether the energy rebate will be delayed being passed on to tenants without legislation.
The announcement comes as the government has announced its energy support package to help businesses around the country in a move that will see their bills being cut by half from their predicted winter levels – this move will also require legislation.
Now, the scheme will see electricity and gas prices being fixed for businesses from 1 October for six months.
The savings will, the government says, be seen in business’s October energy bills – when they are received in November.
The Prime Minister, Liz truss, announced earlier this month government plans to limit energy bill increases for up to two years for all households.
This will see a typical household energy bill being capped at £2,500.
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M K
12:31 PM, 22nd September 2022, About 2 years ago
This is utterly stupid. The increase in energy costs was not factored into any all-inclusive tenancy agreement prior to 2022, which means the tenant has not incurred any of the extortionate increases in energy cost. The energy rebate should be payable to the individual paying for the energy; which would be the landlord!
So the government wants to lump such "all inclusive" landlord with the additional cost of energy yet pass on the energy relief payments to the tenant who ISNT paying for the extra cost.
Helen
12:53 PM, 22nd September 2022, About 2 years ago
Everybody thinks that landlords are a bottomless pit of money. That's why so many of us are leaving the business.
Judith Wordsworth
13:01 PM, 22nd September 2022, About 2 years ago
This is only where the electricity amount is detailed in the all inclusive tenancy agreement. eg room =£x and electric usage =£y or Z units I think.
But if not identified exactly how much £ or how many units are included in the all inclusive rent then, as I read it, it may not need to be passed on to the tenant(s) as the Landlord will be paying the utilities in full.
Worth reading the draft legislation line by line/sentence by sentence (was taught to do this as part of my LLB!)
Mick Roberts
13:51 PM, 22nd September 2022, About 2 years ago
I don't get this. Excuse my ignorance as I don't do bills included. But if Landlord does bills included, he's paid the increased charges has he not? So surely he should be entitled to any refund back which has hurt his pocket?
Aah I see Mohammed says the same. So it is that simple then, we are not even smart, the Govt are thick & anti landlord.
Darren Peters
14:28 PM, 22nd September 2022, About 2 years ago
Have I understood this correctly?
Last year’s bill say £1800
This years bill £2800 less £400 discount = £2400 and I must give £400 to the tenant?
Alistair Cooper
14:59 PM, 22nd September 2022, About 2 years ago
Like all misguided political attempts to ‘lure’ in the Generation Rent Vote the legislation is rushed and poorly drafted confirming once again the complete lack of understanding of the day to day landlording business.
The politicians once again will increase costs for tenants ratter then ‘helping’ them
Even with the new price cap Gas costs will have increased for us from 1.99p/kWH to 11,07p/kWH from 1 Oct; an increase of some 550% or for our HMOs an ‘average’ total annual utility bill cost increase of some £10,000 pa from £4k/yr to over £14k/yr
Fine I’ll give my tenants £11 each per month back for 6 months and increase their rent by £139/month each just to cover the increase I face in direct costs
Many will struggle to afford it but do the government care about that ???
John Grefe
15:23 PM, 22nd September 2022, About 2 years ago
I don't see it that way Re Darren Peters.
Your example of this year's bill of £2800 for is less £400.00. But, not paid to the tenants as it is deducted from the amount chargeable to the tenants,
e.g. £2800 less £400. Amount charged to tenants £2400.
Unless I am wrong?
Reluctant Landlord
15:35 PM, 22nd September 2022, About 2 years ago
another total balls up from Gov plc without LOOKING at the details...I suggest stick with what Judith states above. Check the micro detail.
If bills are included as part of the contract then the tenant does not get a bill and so any bill is sent to the LL and the bill PAYER gets the discount.
Jay
5:51 AM, 23rd September 2022, About 2 years ago
Reply to the comment left by Mohammed Kadir at 22/09/2022 - 12:31We have HMO’s and have a fair usage policy built into our AST, this states that the energy costs are capped at a certain amount, which is fair and reasonable, and if costs are increased beyond this amount, the difference is shared equally between the tenants, this can be adapted if say someone is working from home often, they could be asked to pay mores. If a particular tenancy has become periodic and the capped amount needs to increase then we update our tenant/customers by email of the new capped amount. This is fair to both landlord and tenant in this situation. It really is not the responsibility of the landlord to pay the energy which tenants are using, beyond a fair amount amount allowed for in the rental payment. For me this is the only way forward. In this situation it is fair to pay to the tenants any rebate you receive. That said I understood that the payment was being paid into the energy account each month. Hope this helps.
Andrew Miller
8:21 AM, 24th September 2022, About 2 years ago
Reply to the comment left by Stephen Johnson at 23/09/2022 - 05:51
I think Stephen's approach is the most sensible if you can get all of your tenants to cooperate. The issue is that if one or more of them won't play ball there is nothing I'm aware of that you can do to force them to do so. For this reason I think most HMO landlords will have to take this on the chin until the bills start to feed through to increase market rents. We all hope this is temporary and therefore something akin to the airline industry fuel surcharge would be the answer but again there is no sector wide agreement on inclusive bills and nothing in an AST to protect either side.
Fair usage should surely be based on KwH and not £££ so those clauses in agreements are not useful in this situation. Even if the fair usage was based on £££ I don't know of any way to enforce it if a tenant says it's not their responsibility.
When all is said and done the whole concept of an inclusive price for a bill that is variable (in usage and price) is flawed. It's always been a 'fudge' and has come home to roost because of this temporary spike in prices. The responsibility lies with landlords and sadly we must take the hit.