How to keep discretionary licensing schemes within budget

With the announcement last month of the priorities for the upcoming reform of local government funding (and the 2025 consultation to be carried out on that reform), hard pressed councils will be looking forward to a proposed shift “to a fairer system which matches funding with need.”
Whilst the final policy outcomes from this consultation may include various housing provision elements it will be the case that private rented sector discretionary licensing schemes will still be required to pay their own way via licensing fees charged to landlords. Indeed, the 2019 independent review of licensing made clear that one of the “key mechanisms by which selective licensing achieved effective change” was that “It focuses resources on areas of concern whilst simultaneously generating revenue to contribute to the costs involved”.
However, one should always keep in mind that while the revenue generated from fees contributes to reducing costs incurred, it doesn’t offset all of those costs. Hence, ensuring as much certainty as possible in budget planning is paramount when setting up licensing schemes.
If, for example, the licence fees are set too low, the scheme is likely to be less successful than anticipated; fewer property inspections are carried out; administrative resources may be stretched; recruitment and retention can be adversely affected; and, the resources of other teams, such as Legal, within the local authority can be affected. These effects can be amplified if the authority discovers that there are actually more privately rented properties within the designated area than were initially estimated.
In particular, chapter 10 of the review points out that “The process of making a designation is perceived to be highly complex and bureaucratic, requiring the investment of significant resources before a licence is granted …. streamlining of the application process would be welcomed [by the local authorities surveyed].”
The utilisation by a local authority of a delivery partner such as Home Safe can greatly assist that local authority in keeping costs within budget as the scheme, post designation, progresses. Costs can be fixed in advance for various parts of the licensing process such as online application systems or the carrying out of property inspections. Indeed, with regard to inspections, the review does also point out that whilst using such an alternative approach is not suited to every type of scheme “authorities using a delivery partner report consistently positive outcomes, so it may be worth consideration by an authority at the planning stage”.
Planning and streamlining are key words in this arena and, factoring in to those the fixed costs gained by using a delivery partner such as Home Safe, an authority can be enabled to keep within budget, protect existing resources and produce the required community benefits.