Part 2Regulation of Social Housing

Chapter 7Enforcement powers

Compensation

236Overview

This group of sections allows the regulator to award compensation to a victim of a failure on the part of a registered provider.

237Grounds for award

1

The regulator may require a registered provider to pay compensation if the regulator is satisfied that—

a

either of the following cases applies, and

b

the award of compensation is appropriate (whether or not as part of a response including other action).

2

Case 1 is where the registered provider has failed to meet a standard under section 193 or 194.

3

Case 2 is where the registered provider has given an undertaking under section 125 and failed to comply with it.

238Nature

1

Compensation in respect of a failure may be awarded to one or more persons who have suffered as a result of the failure.

2

But an award may be made only to—

a

a specified tenant of social housing provided by the registered provider,

b

each member of a specified class of tenants of social housing provided by the registered provider, or

c

each member of the class of tenants of social housing provided by the registered provider.

239Housing ombudsman compensation

1

The regulator may not award compensation to a person in respect of a matter if an ombudsman appointed by virtue of section 124 has awarded compensation to the person in respect of the matter.

2

But if compensation awarded by an ombudsman by virtue of section 124 has not been paid as required, the regulator may award compensation.

240Award

1

Compensation is awarded by the regulator giving notice (a “compensation notice”) to—

a

the registered provider, and

b

the person to be compensated.

2

The notice must specify—

a

the grounds on which the compensation is awarded,

b

the amount of the compensation,

c

the person to be compensated,

d

any interest or additional compensation which, by virtue of section 244(2), is payable in the event of late payment, and

e

a period within which it must be paid.

3

The notice may require the registered provider to publish information about the compensation award in a specified manner.

4

The notice must explain the effect of sections 244(1) and (3) and 245.

5

The Secretary of State—

a

shall make regulations about the period under subsection (2)(e),

b

may make other regulations about the form and content of a compensation notice, and

c

may make regulations about the manner in which a compensation notice is given.

241Impact

1

This section applies when the regulator is considering—

a

whether to award compensation, or

b

the amount of compensation to award.

2

The regulator must take account of any information available to it about the financial situation of the registered provider.

3

The regulator must consider the likely impact of the compensation on the registered provider’s ability to provide services.

4

In particular, the regulator must aim to avoid—

a

jeopardising the financial viability of the registered provider,

b

preventing the registered provider from honouring financial commitments, or

c

preventing the registered provider from taking action to remedy the matters on the grounds of which the compensation might be awarded.

242Warning

1

Before giving a compensation notice to a registered provider the regulator must give the provider a notice (a “pre-compensation warning”)—

a

specifying grounds on which the regulator thinks compensation could be awarded,

b

warning the provider that the regulator is considering awarding compensation to a specified person,

c

including any indication that the regulator is able to give of the likely amount of any compensation, and

d

explaining the effect of sections 243, 244(1) and (3) and 245.

2

Before giving a pre-compensation warning the regulator must consult the person appointed by virtue of section 124 as the ombudsman for the scheme of which the registered provider is a member.

3

If the regulator gives a pre-compensation warning it must send a copy to—

a

the HCA, and

b

any other persons it thinks appropriate.

4

For the purposes of subsection (3)(b) the regulator shall consider, in particular, any person who provided information as a result of which the pre-compensation warning is given.

5

A pre-compensation warning must—

a

refer to section 125 (voluntary undertaking), and

b

indicate whether or to what extent the regulator would accept a voluntary undertaking instead of, or in mitigation of, awarding compensation.

6

A pre-compensation warning may be combined with notice under one or more of sections 230, 248, 250 and 252.

243Representations

1

A pre-compensation warning must specify a period during which the registered provider may make representations to the regulator.

2

The period must—

a

be a period of at least 28 days, and

b

begin with the date on which the registered provider receives the pre-compensation warning.

3

Representations may address—

a

whether compensation should be awarded;

b

the amount of any compensation that may be awarded.

4

After the end of the period specified under subsection (1) the regulator shall—

a

consider any representations made, and

b

decide whether to award compensation.

244Enforcement

1

Compensation shall be treated as a debt owed to the person to whom it is awarded.

2

The Treasury may make regulations authorising the regulator—

a

to award interest on compensation not paid during the period specified under section 240(2)(e);

b

to award additional compensation where compensation is not paid during that period.

3

Interest and additional compensation shall be treated as compensation.

4

Regulations under subsection (2)(a) may provide for an interest rate to be—

a

set by a specified person, or

b

determined in accordance with the regulations.

245Appeal

A registered provider who is given a compensation notice may appeal to the High Court against—

a

the award of compensation,

b

its amount, or

c

both.