Last Friday (the 30th September), the Peabody Trust cruelly evicted one of its tenants, a woman who had been opposing them in court for several years. She has a very painful and debilitating form of lupus, severe chest issues and earlier this year was admitted to hospital with pneumonia. At the time of her eviction, due to the stresses of the case, her condition had deteriorated dramatically and she was attending hospital as an out-patient.
Until recently, Peabody, a major London Housing Association established in 1862, had a stock of housing which they looked after and charged rents to cover their costs. It was a very simple process and did not rely on going into debt. If extra money was raised then additional houses were purchased and if there was a shortfall the government subsidised this.
However, in 2011, the Crown Estates decided to sell a large amount of their own social housing stock and Peabody agreed to take this on at a reduced price of £150 million, but this meant that they were no longer able to be social landlords in the way that they had been.
In order to raise the money to pay off this debt and interest to the banks, which had been forced onto them because the government subsidy had stopped, they had no other way but to raise rents. So they thought up the ploy to downgrade the assured tenancies of over 1,200 families, which are regulated by the government’s rent regime, to assured shorthold tenancies – which is probably illegal – so allowing them to charge intermediate rents which they can eventually raise to 80% of market rents. However, the category of intermediate rents only came into force on 1st April, 2012, some 14 months after Peabody had acquired the Crown Estate portfolio.
To justify this, Peabody are arguing that they can cease to be a public body and therefore no longer act as a social landlord when they are charging rents, which is absolute nonsense, yet they are saying this in court and the judges are buying it. They claim that they are now simultaneously both a social landlord and a commercial entity. They use the expression “hybrid” to describe this but, as the commercial purchase of the property portfolio was subsidised by the reduced sale cost, this meant that they could only be a public body in this transaction.
This woman has copious evidence to show that they are a public body and cannot legally do what they are doing and has put in a request for clarification to the European Commission. But the English judges have erred in ignoring this fact in their various judgements.
One other person, Ian MacLeod, has been opposing Peabody to try and prove these illegalities. He had legal aid and his team secured a judicial review where they were ruled against. However, major parts of the defence were ignored by the judge and his legal team believe they are in a strong position to have this reversed in the Court of Appeal. However, Legal Aid for this was refused, despite the wide social implications of the case. As Mr McLeod has no money, he cannot continue.
Before her eviction, she had been fighting her case as a litigant in person and has been given the right to an oral judicial review permission hearing. Despite this, Peabody went ahead with the eviction anyway, which was obtained by very dubious means including deliberately holding back information from the judge that may have resulted in a different ruling. The government are destroying social housing from within and have a lot to answer for.