Mobile homes - pitch fee up-rating: equality impact assessment

Mobile Homes: Pitch Fee Up-rating - Equality Impact Assessment Results

Title of Policy:

Part 6, Section 46 and 47 - Housing (Scotland) Bill (“the Bill”) - Change to the basis of uprating for pitch fees under the Mobile Homes Act 1983 from the Retail Prices Index (RPI) to the Consumer Prices Index (CPI)

Summary of aims and desired outcomes of Policy:

The policy aim is to ensure that the protections relating to pitch fee uprating for residents of mobile homes remain fair, appropriate and in line with the development of statistical measures of inflation by changing the presumed basis of pitch fee uprating under the Mobile Homes Act 1983 from the RPI to the CPI. This contributes to the national outcome that we live in communities that are inclusive, empowered, resilient and safe.

Directorate:

Directorate for Local Government and Housing: Better Homes: Gypsy/Traveller Accommodation and Mobile Homes

Executive summary

The Mobile Homes Act 1983 (and related regulations) control the “consumer” rights of mobile home-owners. It sets out terms which must appear in the “written statement” (the occupancy agreement between site owner and mobile home-owner). These include the arrangements for changing (usually an annual increase or “uprating”) the pitch fee. The pitch fee is the amount which the resident is required by their agreement to pay to the site owner for use of the pitch and wider site, maintenance and certain services. At present the presumption is that pitch fees do not change by more than the increase or decrease in the RPI. The proposal is to change this to the CPI, primarily because RPI is no longer judged to be a reliable measure of inflation.

The Bill will make the following amendments to the Mobile Homes Act 1983:

• Change the basis of pitch fee uprating from the Retail Prices Index (RPI) to the Consumer Prices Index (CPI) for existing and future contracts.
• Update the mechanism for making changes to the inflation index in future to be secondary legislation, to facilitate timely changes as required and;
• Provide protection for residents should a site owner seek to undertake activity to compensate for the loss of income as a result of the change to indexation.

The Bill also amends section 5 of the 1983 Act to remove outdated references to gypsy and traveller sites that are no longer needed as a consequence of previous changes to the law in relation to these sites.

The assessment found that the change from RPI to CPI for pitch fee uprating under the Mobile Homes Act 1983 is likely to have a minor positive impact in terms of advancing equality of opportunity. The proposed changes will:

• Potentially directly positively impact on people with protected characteristics of age, disability and race. This is because the demographic of mobile home residents includes older people, people with disabilities and Gypsy/Travellers. These groups are also more likely to experience poverty and/or be on a fixed income. Over the long term (1989-2023), RPI is a little under one percentage point higher, and more volatile than CPI^[1]. As a result, pitch fees are likely to increase more slowly than they would have done without the change, impacting on disposable income. The move to CPI will also mean that pitch fee increases will align with pension and benefit increases, which are uprated by CPI. As CPI is used for uprating in the rest of the UK there will be equal treatment of residents in England, Scotland and Wales.
• Potentially directly negatively affect the income of site owners and operators of licenced residential mobile home sites. However, as it is thought that RPI is no longer an effective measure of inflation, increases by CPI will better reflect actual inflation in relation to costs. We do not have any evidence about protected characteristics in relation to site owners. The Business Regulatory Impact Assessment includes an analysis of the potential impact on site income.

We have not identified evidence that there is any particular impact in relation to pregnancy or maternity, gender re-assignment, sexual orientation, religion or belief or marriage and civil partnership.

Public sector Gypsy/Traveller sites are also bound by the controls on pitch fee increases in the Mobile Homes Act 1983. The consultation did not find that there were additional or different considerations for Gypsy/Traveller sites. In practice, the benefit of this change may not be felt by Gypsy/Travellers on public sites as the consultation response from the Association of Local Authority Chief Housing Officers (ALACHO) reports that Councils already generally use CPI as a measure in calculating rent increases. However, the change means that this group would be protected should Councils' practice change in future.

The effect of the adjustment to section 5 of the 1983 Act is neutral because it is a technical change to correct an outdated cross-reference in the definition of “protected site” and this change does not impact on the rights of residents.

Background

The cost-of-living crisis and a campaign by residents highlighted the impact of the gap between different inflation measures on pitch fee inflation and that the RPI is no longer judged to be a reliable measure of inflation^[2]. As a result, a commitment was made during the passage of the Cost of Living (Tenant Protection) Scotland Act 2022^[3] to consult on changing the basis of pitch fee uprating from the RPI to the CPI. The proposed changes will affect residents living on sites licensed as permanent residential sites and Gypsy/Travellers on public Gypsy/Traveller sites.

The Scope of the EQIA

This EQIA has considered the impact of the change in pitch fee uprating under the Mobile Homes Act 1983 on mobile home site residents, in particular the protected characteristics (age; disability; sex (including pregnancy and maternity); gender reassignment; sexual orientation; race; and religion or belief) in relation to the requirements of the public sector equality duty to eliminate discrimination; advance equality of opportunity and foster good relations. It also considers the effect of the adjustment to section 5 of the 1983 Act to remove references to gypsy and traveller sites that are no longer needed in consequence of previous changes to the law in relation to these sites.

The key sources of evidence used to undertake the EQIA were routine population-level data sources, as well as research on mobile homes, in particular research for the Scottish Government by the University of York in 2007^[4] and independent research by Consumer Focus Scotland in 2013^[5], and the report on the responses to the consultation on the proposed changes.^[6] For Gypsy/Travellers, we drew on the an analysis of the 2011 Census data^[7] and the Gypsy/Traveller Accommodation Needs: Evidence Review, published in 2020^[8]. We did not identify any data to assess equalities characteristics for site owners.

A Scottish Government Consultation^[9] in spring 2023 proposed the CPI as a robust alternative to RPI as it is widely forecast and used for uprating, including of pensions and benefits. The consultation sought views to inform decisions on whether:

• It would be more appropriate for the presumption for annual increases in pitch fees to be set in line with the CPI rather than the RPI or the Consumer Prices Index including owner occupiers' housing costs (CPIH);
• The change should apply to agreements that are made in the future only or to both existing and future agreements; and
• It would be appropriate for ministers to be able to update the index in future via secondary rather than primary legislation, to keep pace with developments in statistics.

The consultation ran from January to April 2023 and received 171 responses in total^[10]. Organisations accounted for 12 responses; and there were 159 from individuals, almost all of whom identified themselves as residents of mobile home sites. The consultation analysis was published in June 2023. The consultation included a question on the impact on residents and individuals, including equalities groups. 123 respondents provided an answer to the question. Some respondents did not think that there would be much or any impact on individuals from the proposed change. The most common impact mentioned in responses was reduced cost for residents and therefore a potential financial benefit. Particular groups identified as benefiting were older people and people with health conditions or disabilities.

Respondents indicated that these groups make up a large proportion of mobile home residents as this type of accommodation is popular with people downsizing. A minority of responses specifically mentioned older people as benefitting because many site residents are older and living on fixed pension incomes. A few responses also pointed to benefits for disabled people or people living with long term health conditions. Responses also highlighted the benefit of reduced stress or financial worry. In addition, a few responses highlighted a positive impact on the morale of residents because they feel that their voices have been heard or the balance of rights with site operators has been shifted.

Over the long term (1989-2023), RPI is a little under one percentage point higher and more volatile than CPI. As a result, pitch fees are likely to increase more slowly than they would have done without the change, impacting on disposable income for residents on licenced permanent mobile home sites. For an average pitch fee of £172^[11] identified in UK Government research in 2022, this would equate to reduced expenditure of £1.72 per month per pitch, compounding in subsequent years to increase the likely impact. ALACHO published a survey of Council rent and rent rises for Gypsy/Traveller pitches^[12] for 2021-22 and 2022-23. In 2021-22, the average pitch fee was £77.90 per week with the lowest being £53 per week and the highest £98 a week. The average for 2022-23 was £78.91 which equates to a 1.33% rise, well below both RPI and CPI. ALACHO’s consultation response indicated that CPI may already be the basis for uprating where an index is used.

Key Findings

Research by Consumer Focus in 2013 identified 92 park home sites in Scotland, housing an estimated 3,314 mobile homes.^[13] The majority of sites comprised fewer than 50 residential homes. The majority of Scottish local authorities (22 out of 32) confirmed that they had at least one park home site under their area jurisdiction. However, sites tend to be concentrated in Perth and Kinross, Dumfries and Galloway, Fife, Angus, Argyll and Bute, and Aberdeen, with more than half of all the sites in Scotland located in these authorities. More recently, the Scottish Confederation of Park Home Residents Associations estimated in 2022 that there are around 6000 residential pitches with around 9,000 residents in Scotland^[14], although the evidence underpinning this estimation was not available at the time of writing.

Research for the Scottish Government in 2019^[15] identified a total of 54 Gypsy/Traveller sites across Scotland, comprising 29 public and 25 private sites with 397 and 216 pitches respectively.

Age

The information available indicates that park home residents are more likely to be older than people living in traditional housing^[16]. People of pension age are more likely to be on a fixed income, without the flexibility to take on additional work if there are financial pressures. Aligning pitch fees with CPI will benefit them as it is likely to reduce the pace of future increases and it aligns with the basis for uprating state pension and disability benefits.

Research for the Scottish Government carried out by the University of York in 2007 found that residents of caravans and mobile homes in Scotland were more likely to be older than the general population, with 26% of residents in mobile homes being aged 60+ compared with 21% of the general population.^[17] For the case study areas, it was found that a greater number of residents than would be expected for the population as a whole were single person households and pensioners. Fewer were parents or a lone parents by comparison with the rest of the population. This suggests that licenced sites are not a preferred housing choice or families with children. The report states that “families with children were much less likely to live in mobile homes across the case study areas, compared with the profile of the general population in these authorities.”

The Consumer Focus Scotland research, published in 2013, noted that mobile homes have recently become popular for older people on a low fixed income, with 80% of the interviewees participating in the research in Scotland being aged 61 or older. Some sites are marketed specifically for downsizing in retirement and have a minimum age requirement. On behalf of the Morris Leslie Group, Newcastle University^[18] carried out research in 2019 with people in later life on behalf of a park home operator to explore the potential for park home living in Scotland in retirement, in particular in relation to the planning system.

While much of the evidence available in relation to mobile homes is quite dated, the analysis of the responses to the consultation highlighted the view amongst some respondents that older people and people with a disability would benefit particularly from the proposed changes because they comprise a large proportion of residents in mobile homes and so our most recent source of evidence aligns with more historical sources.

According to the detailed analysis of the 2011 census (which is acknowledged to be out of date now) Gypsy/Traveller households were more likely to contain dependent children (36 per cent) than the population as a whole (26 per cent), and they were three times more likely to contain ‘three or more’ dependent children^[19]. So while, in general, mobile homes appear less likely to be a housing option for families with children, Gypsy/Traveller families may be the exception.

Disability

The information available indicates that park home residents are more likely to have a disability or health condition than people living in traditional housing. Aligning pitch fees with CPI will benefit them as it is likely to reduce the pace of future increases and it aligns with disability benefits, which are also uprated by CPI.

Research for the Scottish Government carried out by the University of York in 2007 found that residents in mobile homes were more likely than the general population to have a limiting long term illness, (29% of mobile home compared with 20% of all households in Scotland).^[20] Poor health was identified as a reason for moving to a mobile home. There were a variety of factors associated with health/poor health and perceived benefits of mobile home living. These included reducing overheads, cutting down housing costs and financial security where there had been loss of income resulting from an onset of poor health.

Again, the information available is dated but is supported by the consultation responses.

According to evidence compiled from multiple sources for a 2022 Scottish Government analytical paper^[21] on the cost of living, households with one or more disabled people are more likely to be in poverty. The paper noted that, after housing costs, in 2017-2020, 23% of people in households with a disabled household member were in relatively poverty, compared with 17% of those with no disabled household members.

Race

The pitch fee section of the Mobile Homes Act 1983 applies to both private licenced and public sector Gypsy/Traveller sites. The same protections will therefore be in place for people living in Gypsy/Traveller accommodation and people in the settled community and both will benefit from the effect of slower pitch fee rises on disposable income. In practice, this benefit may not be felt by Gypsy/Travellers on public sites as ALACHO's consultation response reports that Councils already generally use CPI as a measure in calculating rent increases. However, this group would be protected should Councils' practices change in future.

Although there is a lack of robust routine population-level data about poverty levels in the Gypsy/Traveller community, there is evidence that they have poorer outcomes for a number of the drivers related to poverty and child poverty. And there is UK-level survey data from 2021 gathered as part of the Evidence for Equality National Survey (EVENS) study^[22] (which included a sample of 324 Gypsy/Traveller and Roma participants). The study concluded that “People from Roma and Gypsy/Traveller ethnic groups experience the highest levels of socioeconomic deprivation; they are more likely to have no educational qualifications, less likely to be in the highest occupational positions, and have high rates of financial difficulties and benefit receipt.”^[23]

Analysis of 2011 Census data^[24] shows that Gypsy/Travellers are twice as likely to live in rented accommodation, with 40% social renting compared to only 21 per cent of the population as a whole. A much higher percentage of Gypsy/Traveller households lived in a ‘caravan or other mobile or temporary structure’ than the population as a whole, 14% compared to less than 1% of all households. Gypsy/Traveller households were more than twice as likely to be overcrowded, 24% compared to 9% of all households. 2011 Census data also highlights that Gypsy/Travellers have poorer outcomes across a range of outcomes including health, education, and employment, than the settled population.

We found that the effect of the adjustment to section 5 of the 1983 Act to remove references to gypsy and traveller sites that are no longer needed in consequence of previous changes to the law in relation to these sites is neutral because it is a technical change which does not impact on the rights of residents.

Other Characteristics

We have not identified evidence that there is any particular impact in relation to pregnancy or maternity, gender re-assignment, sexual orientation, religion or belief or marriage and civil partnership.

Recommendations and Conclusion

There is limited recent research on the size of the mobile home sector the characteristics of residents, but we were able to reach conclusions on equalities impacts. We found that the change from RPI to CPI for pitch fee uprating under the Mobile Homes Act would have a small positive impact on people with protected characteristics of age, disability and race (Gypsy/Travellers) because they are more likely to be living in mobile homes and therefore to benefit from a slowing in cost rises. People with a disability and Gypsy/Travellers are more likely to be at risk of experiencing poverty^[25] while older people are more likely to be on fixed incomes. We will continue to keep statistical measures under review and the provisions in the Bill provide for amendment to uprating in secondary legislation rather than primary legislation in future, to allow for timely changes.