Part 4Additional control provisions in relation to residential accommodation

Chapter 1Interim and final management orders

Interim management orders: making and operation of orders

110Financial arrangements while order is in force

(1)

This section applies to relevant expenditure of a local housing authority who have made an interim management order.

(2)

“Relevant expenditure” means expenditure reasonably incurred by the authority in connection with performing their duties under section 106(1) to (3) in respect of the house (including any premiums paid for insurance of the premises).

(3)

Rent or other payments which the authority have collected or recovered, by virtue of this Chapter, from persons occupying the house may be used by the authority to meet—

(a)

relevant expenditure, and

(b)

any amounts of compensation payable to a third party by virtue of a decision of the authority under section 128.

(4)

F1If the interim management order is not made under section 102(7A), the authority must pay to such relevant landlord, or to such relevant landlords in such proportions, as they consider appropriate—

(a)

any amount of rent or other payments collected or recovered as mentioned in subsection (3) that remains after deductions to meet relevant expenditure and any amounts of compensation payable as mentioned in that subsection, and

(b)

(where appropriate) interest on that amount at a reasonable rate fixed by the authority,

and such payments are to be made at such intervals as the authority consider appropriate.

(5)

The interim management order may provide for—

(a)

the rate of interest which is to apply for the purposes of paragraph (b) of subsection (4); and

(b)

the intervals at which payments are to be made under that subsection.

Paragraph 24(3) of Schedule 6 enables an appeal to be brought where the order does not provide for both of those matters.

F2(5A)

The Secretary of State may by regulations make provision about how local authorities are to deal with any surplus in a case where the interim management order was made under section 102(7A).

(5B)

In subsection (5A) “surplus” means any amount of rent or other payments collected or recovered as mentioned in subsection (3) that remains after deductions to meet relevant expenditure and any amounts of compensation payable as mentioned in that subsection.

(6)

The authority must—

(a)

keep full accounts of their income and expenditure in respect of the house; and

(b)

afford to each relevant landlord, and to any other person who has an estate or interest in the house, all reasonable facilities for inspecting, taking copies of and verifying those accounts.

(7)

A relevant landlord may apply to F3the appropriate tribunal for an order—

(a)

declaring that an amount shown in the accounts as expenditure of the authority does not constitute expenditure reasonably incurred by the authority as mentioned in subsection (2);

(b)

requiring the authority to make such financial adjustments (in the accounts and otherwise) as are necessary to reflect the tribunal’s declaration.

(8)

In this section—

“expenditure” includes administrative costs;

“relevant landlord” means any person who is an immediate landlord of the house or part of it;

“rent or other payments” means rents or other payments payable under leases or licences or in respect of furniture within section 126(1).