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Housing Associations Act 1985

Type Public General Act

Publication 1985-10-30

Last updated 2023-12-26

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

Part I — Regulation of Housing Associations

Introductory

1

(1) In this Act “housing association” means a society, body of trustees or company—

(a) which is established for the purpose of, or amongst whose objects or powers are included those of, providing, constructing, improving or managing, or facilitating or encouraging the construction or improvement of, housing accommodation, and

(b) which does not trade for profit or whose constitution or rules prohibit the issue of capital with interest or dividend exceeding such rate as may be prescribed by the Treasury, whether with or without differentiation as between share and loan capital ;

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) In this Act “fully mutual”, in relation to a housing association, means that the rules of the association—

(a) restrict membership to persons who are tenants or prospective tenants of the association, and

(b) preclude the granting or assignment of tenancies to persons other than members;

and “co-operative housing association” means a fully mutual housing association which is a registered society within the meaning of the Co-operative and Community Benefit Societies Act 2014 (in this part referred to as “the 1965 Act”).

(3) In this Act “self-build society” means a housing association whose object is to provide, for sale to, or occupation by, its members, dwellings built or improved principally with the use of its members’ own labour.

Meaning of " housing trust"

2

In this Act “housing trust” means a corporation or body of persons which—

(a) is required by the terms of its constituent instrument to use the whole of its funds, including any surplus which may arise from its operations, for the purpose of providing housing accommodation, or

(b) is required by the terms of its constituent instrument to devote the whole, or substantially the whole, of its funds to charitable purposes and in fact uses the whole, or substantially the whole, of its funds for the purpose of providing housing accommodation.

Registration

The register

3

Eligibility for registration

4

Registration

5

Removal from the register

6

Appeal against removal

7

Disposal of land

Power of registered housing associations to dispose of land

8

Control by Housing Corporation of dispositions of land by housing associations

9

(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(1A) Subject to section 10, the consent of the relevant regulator is required for any disposition of grant-aided land (as defined in Schedule 1) by an unregistered housing association; and for this purpose “the relevant regulator” means,—

(a) if the land is in England, the Regulator of Social Housing, and

(b) if the land is in Wales, the Welsh Ministers.

(2) Consent under this section may be so given—

(a) generally to all housing associations or to a particular housing association or description of association;

(b) in relation to particular land or in relation to a particular description of land;

and may be given subject to conditions.

(3) A disposition by a housing association which requires consent under this section is valid in favour of a person claiming under the association notwithstanding that that consent has not been given; and a person dealing with the association, or with a person claiming under the association, shall not be concerned to see or inquire whether any such consent has been given.

This subsection has effect subject to section 12 (avoidance of certain dispositions of houses without consent).

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) For the purposes of this section “disposition” means sale, lease, mortgage, charge or any other disposal.

(6) Consent under this section must be in writing.

Dispositions excepted from s. 9

10

(1) A disposition by an unregistered housing association which is a charity is not within section 9 if by virtue of sections 117 to 121 and 124 of the Charities Act 2011 it cannot be made without an order of the court or the Charity Commission; but before making an order in such a case the Charity Commission shall consult,—

(a) in the case of dispositions of land in England, the Regulator of Social Housing, and

(b) in the case of dispositions of land in Wales, the Welsh Ministers.

(2) A letting ... by an unregistered housing association which is a housing trust, is not within section 9 if it is—

(a) a letting of land under a secure tenancy, or

(b) a letting of land under what would be a secure tenancy but for any of paragraphs 2 to 12 of Schedule 1 to the Housing Act 1985 or paragraphs 1 to 8 of Schedule 2 to the Housing (Scotland) Act 1987 (tenancies excepted from being secure tenancies for reasons other than that they are long leases) or

(d) a letting of land in England or Wales under what would be an assured tenancy or an assured agricultural occupancy but for any of paragraphs 4 to 8 of Schedule 1 to the Housing Act 1988, ...

(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(f) a letting of land under a tenancy or licence that is an occupation contract, or

(g) a letting of land under a tenancy or licence under what would be an occupation contract if notice had been given (see Schedule 2 to the Renting Homes (Wales) Act 2016 (anaw 1)), other than a long tenancy within the meaning of letting of the type described in paragraph 8 of that Schedule (meaning of long tenancies).

(3) The grant by an unregistered housing association which does not satisfy the landlord condition in section 80 of the Housing Act 1985 (bodies which are capable of granting secure tenancies) of a lease for a term ending within the period of seven years and three months beginning on the date of the grant is not within section 9 unless—

(a) there is conferred on the lessee (by the lease or otherwise) an option for renewal for a term which, together with the original term, would expire outside that period, or

(b) the lease is granted wholly or partly in consideration of a fine.

(4) In subsection (3) the expression “lease” includes an agreement for a lease and a licence to occupy, and the expressions “grant” and “term” shall be construed accordingly.

Further provisions as to certain disposals of houses

11

12

A disposal of a house by a housing association made without the consent required by section 9 is void unless—

(a) the disposal is to an individual (or to two or more individuals), and

(b) the disposal does not extend to any other house.

Control of payments to members, etc.

Payments by way of gift, dividend or bonus

13

Maximum amounts payable by way of fees, expenses, etc.

14

Payments and benefits to committee members, etc.

15

Constitution, change of rules, amalgamation and dissolution

General power to remove committee member

16

Power to appoint new committee member

17

Exercise of powers under ss. 16 and 17 in relation to registered charities

18

Change of rules under the 1965 Act

19

Change of objects by certain charities

20

Amalgamation and dissolution under the 1965 Act

21

Housing Corporation's power to petition for winding up

22

Transfer of net assets on dissolution

23

Accounts and audit

General requirements as to accounts and audit

24

Appointment of auditors by associations registered under the 1965 Act

25

Accounting requirements for registered housing associations not within the 1965 Act

26

Responsibility for securing compliance with accounting requirements

27

Inquiries into affairs of housing associations

Inquiry

28

Extraordinary audit for purposes of inquiry

29

General powers exercisable as a result of inquiry or audit

30

Exercise of powers under ss. 28 to 30 in relation to registered charities

31

Power to direct transfer of land to another housing association or the Housing Corporation

32

Miscellaneous

Recognition of central association

33

Provision of land by county councils

34

(1) Where a housing association wishes to erect houses in Englandwhich in the opinion of the Secretary of State are required and the local housing authority in whose district the houses are proposed to be built are unwilling to acquire land with a view to selling or leasing it to the association, the county council, on the application of the association, may acquire land for that purpose.

(2) For that purpose the county council may exercise all the powers of a local housing authority under Part II of the Housing Act 1985 (provision of housing) in regard to the acquisition and disposal of land; and the provisions of that Act as to the acquisition of land by local housing authorities for the purposes of that Part apply accordingly.

Housing trusts: power to transfer housing to local housing authority

35

(1) A housing trust may—

(a) sell or lease to the local housing authority the houses provided by the trust, or

(b) make over to the authority the management of the houses.

(2) So far as subsection (1) confers power to dispose of land—

(za) it does not apply to private registered providers of social housing (on whom power to dispose of land is conferred by section 171 of the Housing and Regeneration Act 2008);

(a) it does not apply to registered social landlords (on whom power to dispose of land is conferred by section 8 of the Housing Act 1996);.

(b) it has effect subject to section 9 (dispositions requiring consent of Corporation) where the housing trust is an unregistered housing association and the land is grant-aided land (as defined in Schedule 1); and

(c) it has effect subject to sections 117 to 121 of the Charities Act 2011 (restrictions on dispositions of charity land) where the housing trust is a charity.

Housing trusts: functions of Secretary of State with respect to legal proceedings

36

(1) If it appears to the Secretary of State—

(a) that the institution of legal proceedings is requisite or desirable with respect to any property belonging to a housing trust, or

(b) that the expediting of any such legal proceedings is requisite or desirable,

he may certify the case to the Attorney-General who may institute legal proceedings or intervene in legal proceedings already instituted in such manner as he thinks proper in the circumstances.

(2) Before preparing a scheme with reference to property belonging to a housing trust, the court or body which is responsible for making the scheme shall communicate with the Secretary of State and consider any recommendations made by him with reference to the proposed scheme.

Supplementary

Definitions relating to the 1965 Act and societies registered under it

37

Definitions relating to charities

38

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Minor definitions

39

In this Part—

“assured tenancy” has, in England and Wales, the same meaning as in Part I of the Housing Act 1988 and, in Scotland, the same meaning as in Part II of the Housing (Scotland) Act 1988;

“assured agricultural occupancy” has the same meaning as in Part I of the Housing Act 1988.

“mental disorder” has the same meaning as in the Mental Health Act 1983 or the Mental Health (Scotland) Act 1984;

“occupation contract” has the same meaning as in section 7 of the Renting Homes (Wales) Act 2016 (anaw 1);

“secure tenancy” has the same meaning as in section 79 of the Housing Act 1985 or 44 of the Housing (Scotland) Act 1987;

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Index of defined expressions: Part I

40

The following Table shows provisions defining or explaining expressions used in this Part (other than provisions defining or explaining an expression used only in the same section or paragraph):—

Part II — Housing Association Finance

Housing association grants

41

Projects qualifying for grant: accommodation for letting, hostels

42

(1) A project is a housing project for the purposes of housing association grant if it is undertaken for the purpose of—

(a) providing dwellings for letting,

(b) providing a building for use as a hostel,

(d) providing land or buildings which, in the opinion of the Secretary of State, will be for the benefit of persons for whom such accommodation is provided, or improving or repairing such buildings.

(2) In subsection (1)—

(a) " letting " in paragraph (a) includes the grant of a shared ownership lease, and

(b) in paragraph (b) " building " includes part of a building and " hostel" includes part of a hostel.

(3) References in this section to letting or the grant of a lease include the grant of a licence to occupy.

Projects qualifying for grant: improvement for sale

43

A project where a registered housing association, after carrying out works of repair, improvement or conversion—

(a) disposes of a house as one dwelling,

(b) divides a house into two or more separate dwellings and disposes of them, or

is a housing project for the purposes of housing association grant.

Projects qualifying for grant: repair or improvement after exercise of right to buy etc.

44

(1) A project where a registered housing association carries out works of repair or improvement to a dwelling-house, or to the building in which a dwelling-house is situated, after the tenant has exercised, or claimed to exercise, the right to buy or the right to a shared ownership lease under Part V of the Housing Act 1985 is a housing project for the purposes of housing association grant.

(2) Where in such a case a housing association grant is made after the tenant has exercised the right to buy or the right to be granted a shared ownership lease, the Secretary of State may reduce the amount of the grant.

(3) In this section " dwelling-house " has the same meaning as in Part V of the Housing Act 1985.

Projects qualifying for grant: disposal to tenant of charitable housing association etc.

45

(1) A project where a registered housing association first acquires a house and then disposes of it at a discount to a tenant to whom this section applies is a housing project for the purposes of housing association grant.

(2) This section applies to a tenant of a publicly-funded dwelling who, but for paragraph 1 of Schedule 5 to the Housing Act 1985 (exceptions to the right to buy: landlord a charitable housing trust or housing association) would have the right to buy.

(3) A dwelling is publicly-funded for this purpose if housing association grant has been paid in respect of a project which included—

(a) the acquisition of the dwelling,

(b) the acquisition of a building and the provision of the dwelling by means of the conversion of the building, or

(4) Where a registered housing association contracts for the acquisition of a house and, without taking the conveyance, grant or assignment, disposes of its interest to a tenant to whom this section applies, subsection (1) and the following provisions have effect as if the association first acquired the house and then disposed of it to the tenant—

section 8 (disposal of land by registered housing associations),

section 9 (consent of Housing Corporation to disposals),

Schedule 2 (covenants for repayment of discount on early disposal and restricting disposal of houses in National Parks, &c),

section 79(2) (power of Housing Corporation to lend to person acquiring interest from registered housing association), and

section 130 of the Housing Act 1985 (reduction of discount on exercise of right to buy where previous discount given).

Applications for housing association grant

46

(1) A housing association grant is not payable in respect of a project unless an application for it is submitted to the appropriate body.

(2) The appropriate body in England and Wales is—

(a) where the housing association concerned makes an application to a local authority for a loan under section 58(2) in connection with the project, that authority, and

(b) in any other case, the Housing Corporation.

(3) The appropriate body in Scotland is a local authority, the Housing Corporation or the Secretary of State.

(4) Where a local authority or the Housing Corporation receive an application under this section, they shall forward it to the Secretary of State together with their own assessment of the project.

Amount of housing association grant: net cost

47

(1) The housing association grant payable in respect of a project is equal to the net cost of the project to the association, determined in accordance with the following provisions, but subject to section 48 (maximum levels of cost and grant).

(2) The net cost of a project to the association is the difference between—

(a) the estimated expenditure of the association which is, in the opinion of the Secretary of State, attributable to the project and is reasonable and appropriate having regard to all the circumstances, and

(b) the estimated income which, in the opinion of the Secretary of State, the association might reasonably be expected to receive in respect of the project, including sums received or to be received by way of grant 01 subsidy, other than sums received or to be received by way of housing association grant.

(3) Estimated expenditure and estimated income for this purpose shall be calculated in such manner as the Secretary of State may, with the consent of the Treasury, from time to time determine, and the calculation may take account of expenditure and income likely to be incurred or received in connection with the premises to which the project relates after the completion of the project.

(4) Before making a general determination under subsection (3) the Secretary of State shall consult such bodies appearing to him to be representative of housing associations as he considers appropriate.

(5) In determining the net cost of a project the Secretary of State may adopt the assessment of the body forwarding the grant application to him under section 46.

(6) If in the case of an application for a housing association grant in respect of a particular project it appears to the Secretary of State appropriate to do so, he may determine the net cost in such manner as he considers appropriate instead of in accordance with the preceding provisions.

Amount of housing association grant: maximum levels of cost and grant

48

(1) The Secretary of State may, with the consent of the Treasury, determine maximum levels of cost or of housing association grant applicable to—

(a) housing projects generally,

(b) any description of housing project, or

and the amount of grant payable shall be limited in accordance with any such determination.

(2) Before making a general determination under subsection (1) the Secretary of State shall consult such bodies appearing to him to be representative of housing associations as he considers appropriate.

(3) The maximum grant which may be paid for any one dwelling in a case of the kind mentioned in section 43 (where dwelling disposed of after conversion, &c.) is—

(a) in respect of a dwelling in Greater London or the City of Glasgow district, £12,500,

(b) in respect of a dwelling elsewhere, £9,500,

or such other sum as the Secretary of State may prescribe by order made with the consent of the Treasury.

(4) An order—

(a) may make different provision for different cases or descriptions of case, including different provision for different areas;

(b) shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Payment of housing association grants

49

(1) A housing association grant in respect of a project is payable either in a single sum or in annual instalments, as the Secretary of State may determine.

(2) A grant payable in a single sum is payable when in the opinion of the Secretary of State the project is completed or its completion has become impossible.

(3) A grant payable in annual instalments is payable in instalments—

(a) beginning in the financial year in which, in the opinion of the Secretary of State, the project is completed or its completion has become impossible, and

(b) continuing over such number of years as he may determine, either generally or in relation to the particular project.

(4) The Secretary of State may, if he considers it appropriate to do so, make payments on account of the grant at a time earlier than indicated by subsection (2) or (3).

(5) The Secretary of State may, on such terms as he may with the approval of the Treasury specify, appoint the Housing Corporation or a local housing authority to act as his agent in connection with the making, in such cases as he may specify, of payments in respect of housing association grant; and, where such an appointment is made, the Corporation or authority shall act as such an agent in accordance with the terms of their appointment

(6) No sum shall be paid in respect of a housing association grant to a body which has been removed from the register of housing associations under section 6.

Grant conditions

50

(1) The Secretary of State may provide—

(a) where the project is approved by him for the purposes of housing association grant, in giving his approval, or

(b) where the project falls within an approved development programme (and thus does not require separate approval), before first making a payment of grant in respect of the project,

that the payment of a housing association grant is conditional on compliance by the housing association concerned with such conditions as he may specify.

(2) The conditions may include, in a case where the project has not yet been completed, conditions as to the period within which it is to be completed.

Payment of grant to another association on transfer of property

51

(1) The Secretary of State may, where at any time—

(a) a housing association grant is payable in respect of a project, and

(b) a dwelling or hostel to which the project relates, or part of such a dwelling or hostel, becomes vested in, or is leased for a term exceeding seven years to, a registered housing association other than the association by whom the grant application was made, or trustees for such an association,

pay to that other association the whole or part of the housing association grant, or any instalment of it, which would otherwise have been paid after that time to the association by whom the grant application was made.

(2) For the purposes of subsection (1) a lease shall be treated as being for a term exceeding seven years where the original term is for a lesser period but the lease confers on the lessee an option for renewal for a term which, together with the original term, exceeds seven years.

Circumstances in which grant may be reduced, suspended or reclaimed

52

Recoupment of surplus rental income

53

Deficit grants

Revenue deficit grants

54

Hostel deficit grants

55

Applications for deficit grants

56

Payment of deficit grants

57

Arrangements with local authorities

Powers of local authorities to promote and assist housing associations: England and Wales

58

(1) A local authority may promote the formation or extension of a housing association.

(2) A local authority may for the assistance of a housing association subscribe for share or loan capital of the association.

(3) A local authority may make a loan to an unregistered self-build society for the purpose of enabling it to meet the whole or part of the expenditure incurred, or to be incurred by it, in carrying out its objects.

(4) This section does not apply where the housing association is—

(a) a private registered provider of social housing, or

(b) a registered social landlord (for which corresponding provision is made by section 22 of the Housing Act 1996).

Powers of local authorities to promote and assist housing associations: Scotland

59

(1) A local authority . . . may promote the formation or extension of or, subject to section 60 (assistance restricted to registered housing associations), assist a housing association whose objects include the erection, improvement or management of housing accommodation.

(2) A local authority . . . may, with the consent of and subject to any regulations or conditions made or imposed by the Secretary of State, for the assistance of such an association—

(a) make grants or loans to the association,

(b) subscribe for share or loan capital of the association, or

(c) guarantee or join in guaranteeing the payment of the principal of, and interest on, money borrowed by the association (including money borrowed by the issue of loan capital) or of interest on share capital issued by the association,

on such terms and conditions as to rate of interest and repayment or otherwise and on such security as the local authority . . . think fit.

(3) A term of an agreement for such a grant or loan is void if it purports to relate to the rent payable in respect of a house to which the agreement relates or the contributions payable towards the cost of maintaining such a house.

(4) Regulations under this section shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(5) Sections 6, 15, 320 and 329 of the Housing (Scotland) Act 1987 (general provisions with respect to housing functions of local authorities etc.) apply in relation to this section and section 61, as they apply in relation to the provisions of that Act.

Certain assistance restricted to registered housing associations

60

Power of local housing authority to supply furniture to housing association tenants

61

(1) A local housing authority may sell, or supply under a hire-purchase agreement, furniture to the occupants of houses provided by a housing association under arrangements made with the authority, and may buy furniture for this purpose.

(2) In this section “hire-purchase agreement” means a hire-purchase agreement or conditional sale agreement within the meaning of the Consumer Credit Act 1974.

(3) This section does not apply where the housing association is —

(a) a private registered provider of social housing, or

(b) a registered social landlord (for which corresponding provision is made by section 22 of the Housing Act 1996).

Grants for affording tax relief

62

Building society advances

Building society advances: certain advances not special advances but subject to their own limit

63

Failure to comply with limit on advances an offence

64

(1) If a building society does not comply with the requirements of section 63(3), (4) and (5) (limits on advances to which that section applies)—

(a) the society and

(b) every officer of the society who knowingly or wilfully authorises or permits the failure to comply,

commits an offence which is triable either way.

(2) A society which is convicted of an offence under this section is liable—

(a) on conviction on indictment, to a fine, and

(b) on summary conviction, to a fine not exceeding the statutory maximum.

(3) An officer who is convicted of an offence under this section is liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding two years, or a fine, or both ;

(b) on summary conviction, to imprisonment for a term not exceeding three months, or a fine not exceeding the statutory maximum, or both.

(4) In this section " statutory maximum " has the meaning given by section 74 of the Criminal Justice Act 1982.

Building society advances: advances by more than one building society

65

A building society may make an advance to which section 63 applies by means of a mortgage under which the same freehold or leasehold estate constitutes the security both for that advance and for advances made to the same housing association by one or more other persons by means of the same mortgage, but only if—

(a) every other person making an advance by means of that mortgage is another building society, and

(b) the mortgagees in the mortgage all covenant with each other not to transfer their interests as mortgagees to a person who is not a building society.

Application of ss. 63 to 65 to Scotland

66

In the application to Scotland of sections 63 to 65 (building society advances)—

(a) for the references to freehold or leasehold estate, substitute references to an estate or interest in land ;

(b) for the references to an advance on the security of freehold or leasehold estate, or to an advance by means of a mortgage, and similar references, substitute references to an advance upon a heritable security ;

(c) for the references to a mortgage, mortgagor or mortgagee substitute, respectively, references to a heritable security, a debtor in a heritable security and the creditor in a heritable security;

(d) for the reference to an offence triable either way substitute a reference to an offence triable either summarily or on indictment.

Loans by Public Works Loan Commissioners

Loans by Public Works Loan Commissioners: England and Wales

67

Loans by Public Works Loan Commissioners: Scotland

68

(1) The Treasury may lend money to a registered housing association—

(a) for the purpose of constructing or improving, or facilitating or encouraging the construction or improvement of, houses,

(b) for the purchase of houses, and

(1A) Any loan made under subsection (1) is a local loan for the purposes of section 3 of the National Loans Act 1968 (see Schedule 4 to that Act).

(2) A loan for any of those purposes shall be secured with interest by a heritable security over—

(a) the land in respect of which that purpose is to be carried out, and

(b) such other land, if any, as may be offered as security for the loan;

and the money lent shall not exceed three-quarters (or, if the payment of the principal of and interest on the loan is guaranteed by a local authority, nine-tenths) of the value, to be ascertained to the satisfaction of the Treasury, of the estate or interest in the land proposed to be burdened.

(3) Loans may be made by instalments as the building of houses or other work on the land burdened under subsection (2) progresses (so, however, that the total loans do not at any time exceed the amount specified in that subsection); and the heritable security may be granted accordingly to secure such loans so to be made.

(4) If the loan exceeds two-thirds of the value referred to in subsection (2), and is not guaranteed as to principal and interest by a local authority, the Treasury shall require, in addition to such a heritable security as is mentioned in that subsection, such further security as they may think fit.

(5) Subject to subsection (6), the period for repayment of a loan under this section shall not exceed 40 years, and no money shall be lent on the security of any land unless the estate or interest proposed to be burdened is either ownership or a lease of which a period of not less than 50 years remains unexpired at the date of the loan.

(6) Where a loan under this section is made for the purposes of carrying out a scheme for the provision of houses approved by the Secretary of State, the maximum period for the repayment of the loan is 50 instead of 40 years, and money may be lent on heritable security over a lease registered or recorded under the Registration of Leases (Scotland) Act 1857 of which a period of not less than ten years in excess of the period fixed for the repayment of the loan remains unexpired at the date of the loan.

Miscellaneous

Power to vary or terminate certain agreements with housing associations

69

(1) This section applies to agreements of the following descriptions—

(a) an agreement for a loan to a housing association by the Housing Corporation under section 2 of the Housing Act 1964 (including such an agreement under which rights and obligations have been transferred to Housing for Wales and then to the Secretary of State);under which rights and obligations have been transferred to the Regulator of Social Housing;

(b) an agreement which continues in force under Part I of Schedule 4 (arrangements with local authority for the provision or improvement of housing);

(d) an agreement which continues in force under Part III of Schedule 4 (special arrangements with the Secretary of State);

(e) an agreement for a loan or grant to a housing association under section 58(2) or 59(2) (financial assistance by local authorities);

(f) a scheme which continues in force under Part V of Schedule 5 (schemes for unification of grant conditions).

(g) an agreement for a loan or grant to a registered housing association under section 24 of the Local Government Act 1988 (power to provide financial assistance for privately let housing accommodation).

(2) If any person (other than the Secretary of State) who is a party to an agreement to which this section applies makes an application to the Secretary of State, he may, if he thinks fit, direct—

(a) that the agreement shall have effect with such variations, determined by him or agreed by the parties, as may be specified in the direction, or

(b) that the agreement shall be terminated.

(2A) In the case of an agreement under which rights and obligations have been transferred to Housing for Wales and then to the Secretary of State, the reference to a party to the agreement includes a reference to the Secretary of State.

(2B) In the case of an agreement under which rights and obligations have been transferred to the Regulator of Social Housing, the reference to a party to the agreement includes a reference to the Regulator of Social Housing.

(3) No variation shall be directed under subsection (2) which would have the effect of including in an agreement a term—

(a) limiting the aggregate amount of rents payable in respect of dwellings to which the agreement relates or contributions towards the cost of maintaining such dwellings, or

(b) specifying a limit which the rent of a dwelling is not to exceed.

This subsection does not extend to Scotland.

(4) No variation shall be directed under subsection (2) which would have the effect of including in an agreement a term relating to the rent payable in respect of a house to which the agreement relates or contributions towards the cost of maintaining such a house.

This subsection extends to Scotland only.

Continuation of arrangements under repealed enactments

70

The provisions of Schedule 4 have effect in relation to certain arrangements affecting housing associations which continue in force despite the repeal of the enactments under or by reference to which they were made, as follows—

Part I —Arrangements with local authorities for the provision or improvement of housing.

Part II —Subsidy agreements with local authorities.

Part III —Special arrangements with the Secretary of State in Scotland.

Superseded contributions, subsidies and grants

71

The provisions of Schedule 5 have effect with respect to superseded subsidies, contributions and grants, as follows—

Part I —Residual subsidies: England and Wales.

Part II —Residual subsidies: Scotland.

Part III—Contributions and grants under arrangements with local authorities.

Part IV—Contributions under arrangements with the Secretary of State in Scotland.

Part V —Schemes for the unification of grant conditions.

Part VI—New building subsidy and improvement subsidy.

Part VII—Payments in respect of hostels under pre-1974 enactments.

Supplementary provisions

Minor definitions

72

In this Part—

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

“registered charity” has the same meaning as in Part I.

Index of defined expressions: Part II

73

The following Table shows provisions defining or explaining expressions used in this Part (other than provisions defining or explaining an expression in the same section);—

Part III — The Housing CorporationSocial Housing in Wales

Functions of the Welsh Ministers and other general matters

The Housing Corporation

74

(1) This Part has effect with respect to the Welsh Ministers.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) The functions in this Part exercisable by the Welsh Ministers may only be exercised in relation to Wales.

General functions of the Corporation

75

(1) The Welsh Ministers have the following general functions—

(a) to facilitate the proper performance of the functions of registered social landlords;

(b) to maintain a register of social landlords and to exercise supervision and control over such persons;

(c) to promote and assist the development of self-build societies (other than registered social landlords) and to facilitate the proper performance of the functions, and to publicise the aims and principles, of such societies;

(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(e) to undertake, to such extent as the Welsh Ministers consider necessary, the provision (by construction, acquisition, conversion, improvement or otherwise) of dwellings for letting or for sale and of hostels, and the management of dwellings or hostels so provided.

(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(1A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(1B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) The Welsh Ministers shall exercise their general functions subject to and in accordance with the provisions of this Act and Part I of the Housing Act 1996.

(3) Subsection (1) is without prejudice to specific functions conferred on the Welsh Ministers by or under this Act or Part I of the Housing Act 1996.

(4) The Welsh Ministers may do such things and enter into such transactions as are incidental to or conducive to the exercise of any of their functions, general or specific, under this Act or Part I of the Housing Act 1996.

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Directions by the Secretary of State

76

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Advisory service

77

(1) The Welsh Ministers may provide an advisory service for the purpose of giving advice on legal, architectural and other technical matters to registered social landlords or unregistered housing associations and to persons who are forming a housing association or are interested in the possibility of doing so.

(2) The Welsh Ministers may make charges for the service.

(3) The powers conferred on the Welsh Ministers by subsections (1) and (2) may be exercised by the Welsh Ministers acting jointly with the Regulator of Social Housing.

Annual report

78

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Relevant Authority’s powers with respect to grants and loans

Lending powers

79

(1) The Welsh Ministers may lend to a registered social landlord or an unregistered self-build society... for the purpose of enabling the body to meet the whole or part of expenditure incurred or to be incurred by it in carrying out its objects.

(2) The Welsh Ministers may lend to an individual for the purpose of enabling him to acquire from—

(a) the Welsh Ministers, or

(b) a registered social landlord or an unregistered self-build society,

a legal estate or interest in a dwelling which he intends to occupy.

(3) A loan under this section may be by way of temporary loan or otherwise, and the terms of a loan made under subsection (1) may include (though the terms of a loan made under subsection (2) may not) terms for preventing repayment of the loan or part of it before a specified date without the consent of the Welsh Ministers.

(4) Subject to that, the terms of a loan under this section shall be such as the Welsh Ministers determine either generally or in a particular case.

Security for loans to unregistered self-build societies

80

(1) Where the Welsh Ministers—

(a) make a loan to an unregistered self-build society under section 79(1); and

(b) under a mortgage ... entered into by the society to secure the loan have an interest as mortgagee or creditor in land belonging to the society,

they may . . . give the society directions with respect to the disposal of the land.

(2) The society shall comply with directions so given so long as the Welsh Ministers continue to have such an interest in the land.

(3) Directions so given may be varied or revoked by subsequent directions ... .

(3A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) The Welsh Ministers shall not give directions under this section requiring a society to transfer its interest in land to them or any other person unless they are satisfied that arrangements have been made which will secure that the members of the society receive fair treatment in connection with the transfer.

Further advances in case of disposal on shared ownership lease

81

Where—

(a) a lease of a dwelling, granted otherwise than in pursuance of the provisions of Part V of the Housing Act 1985 (the right to buy) relating to shared ownership leases, contains a provision to the like effect as that required by paragraph 1 of Schedule 8 to that Act (terms of shared ownership lease: right of tenant to acquire additional shares), and

(b) the Welsh Ministers have, in exercise of any of their powers, left outstanding or advanced any amount on the security of the dwelling,

that power includes power to advance further amounts for the purpose of assisting the tenant to make payments in pursuance of that provision.

Loans made under s. 2 of the Housing Act 1964

82

Schedule 7 (further powers of Relevant Authority with respect to land of certain housing associations) applies where a loan has been made to a housing association under section 2 of the Housing Act 1964 and the loan has not been repaid.

Power to guarantee loans

83

(1) The Welsh Ministers may guarantee the repayment of the principal of, and the payment of interest on, sums borrowed by registered social landlords or unregistered self-build societies.

(2) A guarantee may be subject to terms and conditions.

(3A) The aggregate amount outstanding in respect of—

(a) loans for which the Welsh Ministers (or National Assembly for Wales, Secretary of State or Housing for Wales) have given a guarantee under this section, and

(b) payments made by the Welsh Ministers (or National Assembly for Wales, Secretary of State or Housing for Wales) in meeting an obligation arising by virtue of such a guarantee and not repaid to the Welsh Ministers (or National Assembly for Wales, Secretary of State or Housing for Wales),

shall not exceed £30 million or such greater sum not exceeding £50 million as the Welsh Ministers may specify by order.

(4) An order under subsection (3A)—

(a) shall be made by statutory instrument, and

(b) shall not be made unless, a draft of the order has been laid before, and approved by a resolution of, the National Assembly for Wales.

Agreements to indemnify certain lenders: England and Wales

84

(1) The Welsh Ministers may . . . enter into an agreement with—

(a) a building society lending on the security of a house, or

(b) a recognised body making a relevant advance on the security of a house,

whereby, in the event of default by the mortgagor, and in circumstances and subject to conditions specified in the agreement, the Welsh Ministers bind themselves to indemnify the society or body in respect of the whole or part of the mortgagor’s outstanding indebtedness and any loss or expense falling on the society or body in consequence of the mortgagor’s default.

(2) The agreement may also, if the mortgagor is made party to it, enable or require the Welsh Ministers in specified circumstances to take a transfer of the mortgage and assume rights and liabilities under it, the building society or recognised body being then discharged in respect of them.

(3) The transfer may be made to take effect—

(a) on terms provided for by the agreement (including terms involving substitution of a new mortgage agreement or modification of the existing one), and

(b) so that the Welsh Ministers are treated as acquiring (for and in relation to the purposes of the mortgage) the benefit and burden of all preceding acts, omissions and events.

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) The Welsh Ministers shall, before entering into an agreement in a form about which they have not previously consulted under this subsection, consult—

(a) in the case of a form of agreement with a building society, the Financial Conduct Authority, the Prudential Regulation Authority and such organisations representative of building societies and local authorities as they think expedient, and

(b) in the case of a form of agreement with a recognised body, such organisations representative of such bodies and local authorities as they think expedient.

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Meaning of " recognised body " and " relevant advance "

85

(1) The expressions “recognised body” and “relevant advance” in section 84 (agreements to indemnify certain lenders) shall be construed in accordance with the following provisions.

(2) A “recognised body” means a body specified, or of a class or description specified, in an order made by statutory instrument by the Welsh Ministers . . ..

(3) Before making such an order varying or revoking an order previously made, the Welsh Ministers shall give an opportunity for representations to be made on behalf of a recognised body which, if the order were made, would cease to be such a body.

(4) A “relevant advance” means an advance made to a person whose interest in the dwelling is or was acquired by virtue of a conveyance of the freehold or an assignment of a long lease, or a grant of a long lease by—

a local authority,

a new town corporation,

the Welsh Ministers so far as they are or were exercising functions in relation to property transferred (or to be transferred) to them as mentioned in section 36(1)(a)(i) to (iii) of the New Towns Act 1981,

an urban development corporation,

. . .

..., or

a registered social landlord. or an advance made to such a person by the Welsh Ministers if the conveyance, assignment or grant was made under section 90.

(5) In subsection (4) “long lease” has the same meaning as in Part V of the Housing Act 1985 (the right to buy).

Agreements to indemnify building societies: Scotland

86

(1) Scottish Homes may, with the approval of the Secretary of State, enter into an agreement with a building society or recognised body under which Scottish Homes binds itself to indemnify the building society or recognised body in respect of—

(a) the whole or part of any outstanding indebtedness of a borrower; and

(b) loss or expense to the building society or recognised body resulting from the failure of the borrower duly to perform any obligation imposed on him by a heritable security.

(2) The agreement may also, where the borrower is made party to it, enable or require Scottish Homes in specified circumstances to take an assignation of the rights and liabilities of the building society or recognised body under the heritable security.

(3) Approval of the Secretary of State under subsection (1) may be given generally in relation to agreements which satisfy specified requirements, or in relation to individual agreements, and with or without conditions, as he thinks fit, and such approval may be withdrawn at any time on one month’s notice.

(4) Before issuing any general approval under subsection (1) the Secretary of State shall consult with such bodies as appear to him to be representative of islands and district councils, and of building societies, and also with Scottish Homes and with the Financial Conduct Authority and the Prudential Regulation Authority.

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) In this section, “recognised body” means a body designated, or of a class or description designated, in an order made under this subsection by statutory instrument by the Secretary of State with the consent of the Treasury.

(7) Before making an order under subsection (6) above varying or revoking an order previously so made, the Secretary of State shall give an opportunity for representations to be made on behalf of a recognised body which, if the order were made, would cease to be such a body.

Grants towards expenses in promoting or assisting registered housing associations

87

(1) The Welsh Ministers may give financial assistance to any person to facilitate the proper performance of the functions of registered social landlords or co-operative housing associations.

(2) Assistance under this section may be in the form of grants, loans, guarantees or incurring expenditure for the benefit of the person assisted or in such other way as the Welsh Ministers consider appropriate, except that they may not, in giving any form of financial assistance under this section, purchase loan or share capital in a company.

(3) With respect to financial assistance under this section, the following—

(a) the procedure to be followed in relation to applications for assistance,

(b) the circumstances in which assistance is or is not to be given,

(d) the manner in which, and the time or times at which, assistance is to be given,

shall be such as may be specified by the Welsh Ministers ... .

(4) In giving assistance under this section, the Welsh Ministers may provide that the assistance is conditional upon compliance by the person to whom the assistance is given with such conditions as they may specify.

(5) Where assistance under this section is given in the form of a grant, subsections (1), (2) and (7) to (9) of section 52 of the Housing Act 1988 (recovery, etc. of grants) shall apply as they apply in relation to a grant to which that section applies, but with the substitution, for any reference in those subsections to the registered relevant housing association to which the grant has been given, of a reference to the person to whom assistance is given under this section.

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Relevant Authority’s powers with respect to land and works

Acquisition of land

88

(1) The Welsh Ministers may acquire land by agreement for the purpose of—

(a) selling or leasing it to a registered social landlord or an unregistered self-build society, or

(b) providing dwellings (for letting or for sale) or hostels,

and the Welsh Ministers may acquire land compulsorily for any such purpose.

(2) Land may be so acquired by the Welsh Ministers notwithstanding that it is not immediately required for any such purpose.

(3) The Acquisition of Land Act 1981 applies to the compulsory purchase of land under this section.

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Provision of dwellings or hostels and clearance, management and development of land

89

(1) The Welsh Ministers may provide or improve dwellings or hostels on land belonging to them.

(2) The Welsh Ministers may clear land belonging to them and carry out other work on the land to prepare it as a building site or estate, including—

(a) the laying out and construction of streets or roads and open spaces, and

(b) the provision of sewerage facilities and supplies of gas, electricity and water.

(3) The Welsh Ministers may repair, maintain and insure buildings or works on land belonging to them, may generally deal in the proper course of management with such land and buildings or works on it, and may charge for the tenancy or occupation of such land, buildings or works.

(4) The Welsh Ministers may carry out such operations on, and do such other things in relation to, land belonging to them as appear to them to be conducive to facilitating the provision or improvement of dwellings or hostels on the land—

(a) by the Welsh Ministers themselves, or

(b) by a registered social landlord or unregistered self-build society.

(5) In the exercise of their powers under subsection (4) the Welsh Ministers may carry out any development ancillary to or in connection with the provision of dwellings or hostels, including development which makes provision for buildings or land to be used for commercial, recreational or other non-domestic purposes.

Disposal of land

90

(1) The Welsh Ministers may dispose of land in respect of which they have not exercised their powers under section 89(1) (provision or improvement of dwellings or hostels) and on which they have not carried out any such development as is mentioned in section 89(5) (ancillary development) to a registered social landlord or an unregistered self-build society ....

(2) The Welsh Ministers may dispose of land on which dwellings or hostels have been provided or improved in exercise of their powers under section 89 to—

a registered social landlord,

a local authority,

a new town corporation, or

Scottish Homes;

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) The Welsh Ministers may sell or lease individual dwellings to persons for those persons to occupy.

(4) The Welsh Ministers may dispose of a building or land intended for use for commercial, recreational or other non-domestic purposes in respect of which development has been carried out by virtue of section 89.

(5) The Welsh Ministers may dispose of land which is not required for the purposes for which it was acquired.

91

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The Relevant Authority’s finances

Borrowing powers

92

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Limit on borrowing

93

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Treasury guarantees of borrowing

94

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Grants to Corporation

95

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

General financial provisions

96

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Accounts and audit

97

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Acquisition of securities and control of subsidiaries

Acquisition of securities and promotion of body corporate

98

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Control of subsidiaries

99

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Supplementary provisions

Scottish Special Housing Association may act as agents for Corporation in Scotland

100

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Minor definitions

101

In this Part—

“building society” means a building society within the meaning of the Building Societies Act 1986;

“financial year” means the period of 12 months ending with the 31st March;

“highway”, in relation to Scotland, includes a public right of way;

“subsidiary” has the meaning given by section 1159 of the Companies Act 2006 .

Index of defined expressions: Part III

102

The following Table shows provisions defining or explaining expressions used in this Part (other than provisions defining or explaining an expression in the same section or paragraph):—

Part IV — General Provisions

General provisions

Application to Isles of Scilly

103

(1) This Act applies to the Isles of Scilly subject to such exceptions, adaptations and modifications as the Secretary of State may by order direct.

(2) An order shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Local housing authorities

104

(1) In this Act “local housing authority”—

(a) in relation to England and Wales, has the meaning given by section 1 of the Housing Act 1985, and

(b) in relation to Scotland, means a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994.

(2) References in this Act to the district of a local housing authority—

(a) in England and Wales shall be construed in accordance with section 2 of the Housing Act 1985, and

(b) in Scotland are to the area of a council mentioned in subsection (1)(b) above.

Members of a person's family

105

(1) A person is a member of another's family if—

(a) he is the spouse or civil partner of that person, or he and that person live together as husband and wife, or in a relationship which has the characteristics of the relationship between civil partners or

(b) he is that person's parent, grandparent, child, grand- child, brother, sister, uncle, aunt, nephew or niece.

(2) For the purposes of subsection (1)(b)—

(a) a relationship by marriage or civil partnership shall be treated as a relation- ship by blood,

(b) a relationship of the half-blood shall be treated as a relationship of the whole blood,

(d) an illegitimate child shall be treated as the legitimate child of his mother and reputed father.

Minor definitions-general

106

(1) In the application of this Act in England and Wales—

“bank” means—an institution authorised under the Banking Act 1987, ora company as to which the Secretary of State was satisfied immediately before the repeal of the Protection of Depositors Act 1963 that it ought to be treated as a banking company or discount company for the purposes of that Act;

“the Companies Act” means the Companies Act 1985;

“dwelling” means a building or part of a building occupied or intended to be occupied as a separate dwelling, together with any yard, garden, outhouses and appurtenances belonging to it or usually enjoyed with it;

“friendly society” means a friendly society or branch of a friendly society registered under the Friendly Societies Act 1974 or earlier legislation;

“hostel” means a building in which is provided for persons generally or for a class or classes of persons—residential accommodation otherwise than in separate and self-contained sets of premises, andeither board or facilities for the preparation of food adequate to the needs of those persons, or both;

“house” includes—any part of a building which is occupied or intended to be occupied as a separate dwelling;any yard, garden, outhouses and appurtenances belonging to the house or usually enjoyed with it;

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

“insurance company” means an insurance company to which Part II of the Insurance Companies Act 1982 applies;

“local authority” means a county, county borough, district, or London borough council, the Common Council of the City of London or the Council of the Isles of Scilly and in section 84(5) includes ... a joint authority established by Part IV of the Local Government Act 1985 , an economic prosperity board established under section 88 of the Local Democracy, Economic Development and Construction Act 2009 , a combined authority established under section 103 of that Act and a combined county authority established under section 9(1) of the Levelling-up and Regeneration Act 2023 ... and in section 85(4) includes such a joint authority such an economic prosperity board, such a combined authority, such a combined county authority, ... , a police and crime commissioner and the Mayor's Office for Policing and Crime;

“new town corporation” means the Commission for the New Towns or a development corporation within the meaning of the New Towns Act 1981;

“shared ownership lease” means a lease—granted on payment of a premium calculated by reference to a percentage of the value of the house or dwelling or of the cost of providing it, orunder which the tenant (or his personal representatives) will or may be entitled to a sum calculated by reference directly or indirectly to the value of the house or dwelling;

“trustee savings bank” means a trustee savings bank registered under the Trustee Savings Bank Act 1981 or earlier legislation;

“urban development corporation” means an urban development corporation established under Part XVI of the Local Government, Planning and Land Act 1980.

(2) In the application of this Act in Scotland—

“bank” has the same meaning as in subsection (1);

“charge” includes a heritable security;

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

“dwelling” means a house;

“friendly society” has the same meaning as in subsection (1);

“heritable security” means any security capable of being constituted over any land, or real right in land, by disposition of the land, or assignation of the real right, in security of any debt and of being recorded in the Register of Sasines or, as the case may be, registered in the Land Register of Scotland and which includes a security constituted by an ex facie absolute disposition or assignation or by a standard security;

“hostel” means—in relation to a building provided or converted before 3rd January 1962, a building in which is provided, for persons generally or for any class or classes of persons, residential accommodation (otherwise than in separate and self-contained dwellings) and board, andin relation to a building provided or converted on or after that date, a building in which is provided for persons generally or for any class or classes of persons, residential accommodation (otherwise than in houses) and either board or common facilities for the preparation of adequate food to the needs of those persons, or both;

“house” includes—any part of a building, being a part which is occupied or intended to be occupied as a separate dwelling, and in particular includes a flat, andincludes also any yard, garden, outhouses and pertinents belonging to the house or usually enjoyed with it;

“housing activities” has the same meaning as in subsection (1);

“insurance company” has the same meaning as in subsection (1);

“local authority” means a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994;

“mortgage” means a heritable security and “mortgagee” means a creditor in such a security;

“new town corporation” means a development corporation within the meaning of the New Towns (Scotland) Act 1968;

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Final provisions

Short title, commencement and extent

107

(1) This Act may be cited as the Housing Associations Act 1985.

(2) This Act comes into force on 1st April 1986.

(3) The following provisions of this Act apply to England and Wales only—

section 2,

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

section 8(2) and (3),

sections 11 and 12,

section 17(4),

section 18,

section 20,

section 31,

sections 34 to 36,

section 38,

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

section 58,

section 67,

section 69(3),

section 81,

sections 84 and 85,

section 103,

section 105,

Schedules 2 and 3,

In Schedule 4, Part I,

In Schedule 5, Part I, paragraphs 1 and 2 of Part III and paragraph 1 of Part V.

(4) The following provisions of this Act apply to Scotland only—

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

section 15A

section 59,

section 66,

section 68,

section 69(4),

section 86,

In Schedule 4, Part III,

In Schedule 5, Part II, paragraphs 3 and 4 of Part III, Part IV and Part VII.

(5) This Act does not extend to Northern Ireland.

SCHEDULE 1

Definition of “grant-aided land”

1

For the purposes of section 9(1A) (control . . . of dispositions of land by unregistered housing associations) “grant-aided land” means land—

(a) in respect of which a payment of a description specified in paragraph 2 falls or fell to be made in respect of a period ending after 24th January 1974, or

(b) on which is, or has been, secured a loan of a description specified in paragraph 3 in respect of which a repayment (by way of principal or interest or both) falls or fell to be made after 24th January 1974.

Payments

2

The payments referred to in paragraph 1(a) are—

(a) payments by way of annual grants or exchequer contributions under—

section 31(3) of the Housing Act 1949,

section 19(3) of the Housing (Scotland) Act 1949, or

section 121(3) of the Housing (Scotland) Act 1950

(arrangements by local authorities for improvement of housing accommodation);

(b) payments by way of annual grants or exchequer contributions under—

section 12(1) or 15 of the Housing (Financial Provisions) Act 1958,

section 89(1) of the Housing (Scotland) Act 1950,

section 12 of the Housing (Scotland) Act 1962, or

section 21 of the Housing (Financial Provisions) (Scotland) Act 1968

(contributions for dwellings improved under arrangements with local authorities or grants for hostels);

section 12(6) of the Housing Subsidies Act 1967,

section 121 of the Housing (Scotland) Act 1950,

section 62 of the Housing Act 1964, or

section 17 of the Housing (Financial Provisions) (Scotland) Act 1968

(subsidies for conversions or improvements by housing associations);

(d) payments by way of annual grant under—

(e) payments by way of subsidy under—

section 72, 73, 75 or 92 of the Housing Finance Act 1972,

section 52, 53, 55 or 57 of the Housing (Financial Provisions) (Scotland) Act 1972, or

Parts I, II, VI and VII of Schedule 5 to this Act (basic or special residual subsidy, new building or improvement subsidy, hostel subsidy).

Loans

3

The loans referred to in paragraph 1(b) are—

(a) loans under—

section 119 of the Housing Act 1957,

section 152 of the Housing (Scotland) Act 1966,

section 58 of this Act, or

section 59 of this Act

(powers of certain local authorities to promote and assist housing associations);

(b) loans to housing associations under—

section 47 of the Housing (Financial Provisions) Act 1958,

section 78 of the Housing (Scotland) Act 1950,

section 24 of the Housing (Financial Provisions) (Scotland) Act 1968,

section 67 of this Act, or

section 68 of this Act

(loans by Public Works Loan Commissioners to certain bodies);

section 7 of the Housing Act 1961,

section 11 of the Housing (Scotland) Act 1962, or

section 23 of the Housing (Financial Provisions) (Scotland) Act 1968

(advances to housing associations providing housing accommodation for letting);

(d) loans under—

(loans by Housing Corporation to housing associations).

SCHEDULE 2

Repayment of discount on early disposal

1

(1) This paragraph applies where, on a disposal of a house under section 8, in accordance with a consent given by the Housing Corporation under section 9, a discount has been given to the purchaser by the housing association; but this paragraph does not apply in any such case if the consent so provides.

(2) On the disposal the conveyance, grant or assignment shall contain a covenant binding on the purchaser and his successors in title to pay to the housing association on demand, if within a period of three years there is a relevant disposal which is not an exempted disposal (but if there is more than one such disposal then only on the first of them), an amount equal to the discount reduced by one-third for each complete year which has elapsed after the conveyance, grant or assignment, and before the further disposal.

Liability to repay is a charge on the premises

2

(1) The liability that may arise under the covenant required by paragraph 1 is a charge on the house, taking effect as if it had been created by deed expressed to be by way of legal mortgage.

(2) Subject to sub-paragraphs (2A) and (2B), the charge has priority immediately after any legal charge securing an amount—

(a) left outstanding by the purchaser, or

(b) advanced to him by an approved lending institution for the purpose of enabling him to acquire the interest disposed of on the first disposal.

(2A) The following, namely—

(a) any advance which is made otherwise than for the purpose mentioned in sub-paragraph (2)(b) and is secured by a legal charge having priority to the charge taking effect by virtue of this paragraph, and

(b) any further advance which is so secured,

shall rank in priority to that charge if, and only if, the housing association by written notice served on the institution concerned gives its consent; and the housing association shall so give its consent if the purpose of the advance or further advance is an approved purpose.

(2B) The housing association may at any time by written notice served on an approved lending institution postpone the charge taking effect by virtue of this paragraph to any advance or further advance which—

(a) is made to the purchaser by that institution, and

(b) is secured by a legal charge not having priority to that charge;

and the housing association shall serve such a notice if the purpose of the advance or further advance is an approved purpose.

(3) A charge taking effect by virtue of this section is a land charge for the purposes of section 59 of the Land Registration Act 1925 notwithstanding subsection (5) of that section (exclusion of mortgages), and subsection (2) of that section applies accordingly with respect to its protection and realisation.

(3A) The covenant required by paragraph 1 (covenant for repayment of discount) does not, by virtue of its binding successors in title of the purchaser, bind a person exercising rights under a charge having priority over the charge taking effect by virtue of this paragraph, or a person deriving title under him; and a provision of the conveyance, grant or assignment, or of a collateral agreement, is void in so far as it purports to authorise a forfeiture, or to impose a penalty or disability, in the event of any such person failing to comply with that covenant.

(4) The approved lending institutions for the purposes of this paragraph are—

a building society,

a bank,

a trustee savings bank,

an insurance company,

a friendly society,

the Housing Corporation

and any body specified, or of a class or description specified, in an order made under section 156 of the Housing Act 1985 (which makes provision in relation to disposals in pursuance of the right to buy corresponding to that made by this paragraph).

(5) The approved purposes for the purposes of this paragraph are—

(a) to enable the purchaser to defray, or to defray on his behalf, any of the following—

(i) the cost of any works to the house,

(ii) any service charge payable in respect of the house for works, whether or not to the house, and

(iii) any service charge or other amount payable in respect of the house for insurance, whether or not of the house, and

(b) to enable the purchaser to discharge, or to discharge on his behalf, any of the following—

(i) so much as is still outstanding of any advance or further advance which ranks in priority to the charge taking effect by virtue of this paragraph,

(ii) any arrears of interest on such an advance or further advance, and

(iii) any costs and expenses incurred in enforcing payment of any such interest, or repayment (in whole or in part) of any such advance or further advance;

and in this sub-paragraph “service charge” has the meaning given by section 621A of the Housing Act 1985.

(6) Where different parts of an advance or further advance are made for different purposes, each of those parts shall be regarded as a separate advance or further advance for the purposes of this paragraph.

Restriction on disposal of houses in National Parks, etc.

3

(1) Where a conveyance, grant or assignment executed under section 8 is of a house situated in—

(a) a National Park,

(b) an area designated under section 87 of the National Parks and Access to the Countryside Act 1949 as an area of outstanding natural beauty, or

(c) an area designated as a rural area by order under section 157 of the Housing Act 1985 (which makes provision in relation to disposals in pursuance of the right to buy corresponding to that made by this paragraph),

the conveyance, grant or assignment may (unless it contains a condition of a kind mentioned in section 33(2)(b) or (c) of the Housing Act 1985 (right of pre-emption or restriction on assignment)) contain a covenant limiting the freedom of the purchaser (including any successor in title of his and any person deriving title under him or such a successor) to dispose of the house in the manner specified below.

(2) The limitation is that until such time (if any) as may be notified in writing by the housing association to the purchaser or a successor in title of his, there will be no relevant disposal which is not an exempted disposal without the written consent of the housing association; but that consent shall not be withheld if the disposal is to a person satisfying the condition stated in sub-paragraph (3).

(3) The condition is that the person to whom the disposal is made (or, if it is made to more than one person, at least one of them) has, throughout the period of three years immediately preceding the application for consent—

(a) had his place of work in a region designated by order under section 157(3) of the Housing Act 1985 which, or part of which, is comprised in the National Park or area, or

(b) had his only or principal home in such a region;

or has had the one in part or parts of that period and the other in the remainder; but the region need not have been the same throughout the period.

(4) A disposal in breach of such a covenant as is mentioned in sub-paragraph (1) is void.

(5) The limitation imposed by such a covenant is a local land charge and, if the land is registered under the Land Registration Act 1925, the Chief Land Registrar shall enter the appropriate restriction on the register of title as if application therefor had been made under section 58 of that Act.

(6) In this paragraph “purchaser” means the person acquiring the interest disposed of by the first disposal.

Relevant disposals

4

(1) A disposal, whether of the whole or part of the house, is a relevant disposal for the purposes of this Schedule if it is—

(a) a conveyance of the freehold or an assignment of the lease, or

(b) the grant of a lease or sub-lease (other than a mortgage term) for a term of more than 21 years otherwise than at a rack rent.

(2) For the purposes of sub-paragraph (1)(b) it shall be assumed—

(a) that any option to renew or extend a lease or sub-lease, whether or not forming part of a series of options, is exercised, and

(b) that any option to terminate a lease or sub-lease is not exercised.

Exempted disposals

5

(1) A disposal is an exempted disposal for the purposes of this Schedule if—

(a) it is a disposal of the whole of the house and a conveyance of the freehold or an assignment of the lease and the person or each of the persons to whom it is made is a qualifying person (as defined in sub-paragraph (2));

(b) it is a vesting of the whole of the house in a person taking under a will or on an intestacy;

(c) it is a disposal of the whole of the house in pursuance of an order made under section 24 of the Matrimonial Causes Act 1973 (property adjustment orders in connection with matrimonial proceedings) or section 2 of the Inheritance (Provisions for Family and Dependants) Act 1975 (orders as to financial provision to be made from estate);

(d) it is a compulsory disposal; or

(e) the property disposed of is property included with the house by virtue of paragraph (b) of the definition of “house” in section 106(1) (yard, garden, outhouses, &c.).

(2) For the purposes of sub-paragraph (1)(a), a person is a qualifying person in relation to a disposal if—

(a) he is the person or one of the persons by whom the disposal is made,

(b) he is the spouse or a former spouse of that person or one of those persons, or

(c) he is a member of the family of that person or one of those persons and has resided with him throughout the period of twelve months ending with the disposal.

Meaning of “compulsory disposal”

6

In this Schedule a “compulsory disposal” means a disposal of property which is acquired compulsorily, or is acquired by a person who has made or would have made, or for whom another person has made or would have made, a compulsory purchase order authorising its compulsory purchase for the purposes for which it is acquired.

Exempted disposals which end liability under covenants

7

Where there is a relevant disposal which is an exempted disposal by virtue of paragraph 5(1)(d) or (e) (compulsory disposal or disposal of yard, garden etc.)—

(a) the covenant required by paragraph 1 (repayment of discount on early disposal) is not binding on the person to whom the disposal is made or any successor in title of his, and that covenant and the charge taking effect by virtue of paragraph 2 cease to apply in relation to the property disposed of, and

(b) any such covenant as is mentioned in paragraph 3 (restriction on disposal of houses in National Parks, etc.) ceases to apply in relation to the property disposed of.

Treatment of option

8

(1) For the purposes of this Schedule the grant of an option enabling a person to call for a relevant disposal which is not an exempted disposal shall be treated as such a disposal made to him.

(2) For the purposes of paragraph 3(2) (requirement of consent to disposal of house in National Park, etc.) a consent to such a grant shall be treated as a consent to a disposal made in pursuance of the option.

SCHEDULE 3

Books of account, &c.

1

(1) The association shall in respect of its housing activities—

(a) cause to be kept proper books of account showing its transactions and its assets and liabilities, and

(b) establish and maintain a satisfactory system of control of its books of account, its cash holdings and all its receipts and remittances.

(2) The books of account must be such as to enable a true and fair view to be given of the state of affairs of the association in respect of its housing activities, and to explain its transactions in the course of those activities.

Accounts and balance sheets

2

(1) The association shall for each period of account prepare—

(a) a revenue account giving a true and fair view of the association’s income and expenditure in the period, so far as arising in connection with its housing activities, and

(b) a balance sheet giving a true and fair view as at the end of the period of the state of the association’s affairs.

(2) The revenue account and balance sheet must be signed by at least two trustees of the association.

Appointment of auditor

3

(1) The association shall in each period of account appoint a qualified auditor to audit the accounts prepared in accordance with paragraph 2.

(2) A person is qualified for the purposes of this paragraph if he is eligible for appointment as a company auditor under section 25 of the Companies Act 1989.

(3) But none of the following shall be appointed—

(a) a trustee, officer or employee of the association or of an associated body,

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Housing Associations Act 1985

Part I — Regulation of Housing Associations

Introductory

Meaning of "housing association " and related expressions

1

Meaning of " housing trust"

2

Registration

The register

3

Eligibility for registration

4

Registration

5

Removal from the register

6

Appeal against removal

7

Disposal of land

Power of registered housing associations to dispose of land

8

Control by Housing Corporation of dispositions of land by housing associations

9

Dispositions excepted from s. 9

10

Further provisions as to certain disposals of houses

11

Avoidance of certain disposals of houses without consent

12

Control of payments to members, etc.

Payments by way of gift, dividend or bonus

13

Maximum amounts payable by way of fees, expenses, etc.

14

Payments and benefits to committee members, etc.

15

Constitution, change of rules, amalgamation and dissolution

General power to remove committee member

16

Power to appoint new committee member

17

Exercise of powers under ss. 16 and 17 in relation to registered charities

18

Change of rules under the 1965 Act

19

Change of objects by certain charities

20

Amalgamation and dissolution under the 1965 Act

21

Housing Corporation's power to petition for winding up

22

Transfer of net assets on dissolution

23

Accounts and audit

General requirements as to accounts and audit

24

Appointment of auditors by associations registered under the 1965 Act

25

Accounting requirements for registered housing associations not within the 1965 Act

26

Responsibility for securing compliance with accounting requirements

27

Inquiries into affairs of housing associations

Inquiry

28

Extraordinary audit for purposes of inquiry

29

General powers exercisable as a result of inquiry or audit

30

Exercise of powers under ss. 28 to 30 in relation to registered charities

31

Power to direct transfer of land to another housing association or the Housing Corporation

32

Miscellaneous

Recognition of central association

33

Provision of land by county councils

34

Housing trusts: power to transfer housing to local housing authority

35