Following a review, new billing arrangements are now in place for major works, with leaseholders being invoiced their yearly contribution towards major works costs on estimate in advance, alongside the April and October service charges.
The change in billing affects only those schemes planned major works delivered under the 10 year major works term contract. These new contractual arrangements that were commissioned in 2017, will help deliver a more efficient service for major works billing, greater programme certainty and more accurate budget estimates.
The format and content of the new bills has been shaped through consultation with lessee representatives from the four resident area panels. It has also been amended as a result of feedback from leaseholders who received these bills in the 2017-18 financial year. The accounts include a colour scheme, blue for day to day charges and green for major works charges.
The estimates will be calculated based on the anticipated spend in each financial year. We will be taking the overall scheme budget and dividing it over the expected duration of the project, using the planned start and end dates of the works.
Key benefits of changing the billing process:
- You can see the planned works and costs in advance. As the estimates are based on the programmed annual budget estimate, they will be sent to you before the Section 20 Notices. Your statutory notice will still be sent for all schemes where any leaseholder liability exceeds £250 and will include further details of whole scheme costs together with the opportunity to submit your feedback. The earlier billing in no way affects your statutory rights.
- Earlier notification about works will enable you to get involved and ask questions sooner on in the process.
- Lower administration and management costs within your major works bills as a result of improved processes.
- For lessees who do not want to make payment before the works have been consulted on or completed, there is an option to opt out of paying half-yearly, and to defer payment until the final account is settled for the entire scheme.
- Payment options will be offered on major works separately from day to day service charges. For major works costs, we will offer the maximum instalments available on each annual bill, ensuring the length of instalment terms will be greater for large schemes spanning two or more years. We will be applying the existing payment options to each half yearly bill rather than to the entire estimated liability, which will mean that you have considerably longer to clear estimated accounts.
- This gives an earlier opportunity to apply for additional ‘help assessments’ on repayments.
The changes were made as a result of findings from a business process review, which followed feedback on major works from customers. We hope the changes will address issues lessees have historically raised.
Over the coming months lessees will be asked to share your views and feedback. In the meantime, please download the frequently asked questions leaflet about the change to the major works billing and how the processes will work. If you do have any further questions, please don’t hesitate to contact our customer services team.