Housing association residents overcharged huge amounts in service fees

Michael Savell and his neighbours in Greenwich noticed they were being charged for a personal gas supply despite not having one

London residents have accused their housing associations of overcharging them thousands of pounds for services they have not used.

Some tenants were charged to have rubbish removed from a completely different estate, while others had to pay over £300 to change a light bulb.

A group of neighbours in Greenwich even managed to reclaim £318,000 in fees from their housing association.

The housing associations involved have reimbursed residents for "errors" made.

Housing associations provide affordable homes for leaseholders and tenants who pay annual service fees which generally range between £600 and £2,000.

The service charges, which are not regulated, cover items such as garden maintenance, CCTV, communal boilers and lift servicing.

Michael Savell, a resident of Optivo association in Greenwich, said he first started looking at his service charge accounts in 2015 when he noticed a charge for personal gas supply totalling £23,000.

"This was obviously incorrect as the only gas coming into the building is for the plant room and the commercial kitchen, neither of which are service chargeable," he said.

He told the BBC he and board members of the residents association challenged the cost with the senior management of the housing association.

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"This led to us reviewing other charges that were suspicious and eventually led to refunds totalling over £318,000 and reductions of a further £109,000 in the charges for 2017-18," he said.

"I would urge everyone to study their service charge statements and launch challenges wherever possible.

"Our experience shows that they are certainly not always right and there are massive overcharges coming out of your pocket."

Optivo said it had addressed service charge inconsistencies left from a previous landlord but strongly refuted some of the claims made by Mr Savell.

A spokesperson said: "We explained to residents that due to the complexity of the scheme, it would take some time to unpick and resolve all the issues relating to the previous landlord.

"Our thorough review has now resulted in an adjustment to charges and residents' accounts were credited accordingly."

Ed Spencer from Bethnal Green has managed to recoup over £25,000

Ed Spencer, a One Housing Group resident in Bethnal Green, recouped over £25,000 of fees from the period 2016-2019, but said he and his neighbours were still waiting for an explanation of many charges imposed on them from 2019 to now.

This includes a concierge service costing £130,000 a year, which Mr Spencer says does not correlate with the £25,000-a-year salary paid to the three concierges.

One Housing said the charges were not incorrect, but it no longer held the records relating to them to prove so.

As for the concierge costs, it said the fees included back-office costs, add-on costs such as national insurance, pensions, holiday and sickness cover, training and materials relating to the service.

Joanna, from New Cross, found her housing association, Hyde, had been overcharging residents £2,000 for rubbish removal from an entirely different estate.

She said: "This is just the tip of the iceberg. They have been charging us for flats and houses that are not part of our estate, as set out in our lease. We had to pay a fee to the land registry to check this."

So far Joanna and neighbours have recouped £500. Hyde admitted the "minor errors", and promised to reimburse residents where other fees have been mischarged.

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The Social Housing Action Campaign (SHAC) has launched a campaign on platform Find Others to urge housing associations to return potentially millions of pounds for incorrect charges.

Suzanne Muna, SHAC's secretary, told the BBC service charge abuse had been going on within the housing association sector for years.

"It is one of the top two causes of complaints from our members, often combined with declining standards of service and an increase in disrepairs."

She said the group had seen evidence of tenants "being charged upwards of £300 to change a lightbulb, £9,000 for communal electricity in a block of just seven flats, and payments for public spaces, lighting, and waste removal.

"There have been charges for lifts where none exist, and concierges that are absent from the estate. Another example was a charge for a permanently flooded car park that couldn't be used."

She added the campaign "will allow housing association tenants and residents to come together on an unprecedented scale".

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