The Housing (Right to Manage) Regulations 1994 (the RTM Regulations) allow a Tenant Management Organisation (TMO) to take over the running of housing services (such as collecting rents and service charges and organising repairs and maintenance) from the council. Tenants do not have to do these tasks themselves - they can employ staff; use council housing staff who will be seconded to the Tenant Management Organisation (TMO); or employ a managing agent. The responsibilities of the council and the TMO are negotiated and set out in a management agreement.

All tenants’ groups exercising the RTM must follow the procedures laid down in the Regulations. This involves an ‘Initial Feasibility Study’ to prepare for the setting up of a TMO. If tenants vote in favour, an agency will carry out a ‘Full Feasibility Study’ to prepare the tenants' group for its chosen role in housing management. An agency is defined as an ‘Approved Person’ under the RTM Regulations. This guide includes information on the role of the agency.

Compliance with statutory guidance is a condition of RTM grant at Feasibility and Development stage and lack of compliance is included as grounds for clawback of grant.

It involves a rigorous and demanding process, lasting three to four years and should only be undertaken by tenants’ groups which are prepared to devote the time, effort and commitment needed. Tenants will, with the help of an agency, receive comprehensive advice and thorough training to ensure that they are competent to take on management responsibilities.

The RTM is only available to tenants of local authorities. Tenants of housing associations do not have a statutory RTM. The Corporation’s Resident involvement policy (2004) sets out a wide range of ways in which residents of housing associations can become involved in improving their landlord’s services. The Corporation's Involvement Policy is currently under review and a revised Policy is expected to be published in the spring of 2007. This does not mean that housing association residents cannot be involved in the management of their homes where they choose to, but that it is a matter between associations and their residents. Where residents want, and are able, to take on management responsibility, the Corporation expects associations to work constructively with them to fulfil that obligation.

Quality Assurance checks

With effect from April 2007 the Corporation intends to introduce a programme of monitoring visits to developing TMOs.  The purpose of the visit will be to ensure that the grant provided by the Corporation through the Tenant Empowerment Programme is being spent in accordance with the schedule of conditions and that the organisation has adequate financial monitoring systems in place.

The framework is being further developed so as to include all TMOs and will include Agents within the quality assurance and monitoring process.

Getting started

In order to comply with the RTM Regulations, council tenants must set up a tenants’ group (the TMO) with an appropriate constitution, and appoint an agency from the List of Approved Persons to help them through the RTM process. Agencies will also provide general advice on how to go about the RTM. Tenants’ groups are strongly recommended to involve their council as early as possible in their considerations.

Further information and guidance is provided at:

• The Modular Management Agreement
• The Guide to the RTM gives additional information on the issues to be considered and outlines the steps to be undertaken at each of the above stages of the RTM process
• Preparing to Manage, including guidelines for assessment of competence of a TMO
• Managing the Money available from tenantempowerment@housingcorp.gsx.gov.uk
• Learning to Manage, a good practice guide for the development of Tenant Management Organisations

Tenant empowerment will be a key component of a local authority’s housing strategy and tenants’ groups should work in close co-operation with their councils throughout the RTM process, but particularly when commissioning an Options Study or Pre-Feasibility Study. This will ensure that the opportunities and any constraints of developing a TMO are fully explored from the outset and that there is a sense of joint ownership of the process.

Setting up a TMO with Right to Manage Grant Funding

Under the RTM Regulations, local authorities are required to support the development and setting up of TMOs. However, RTM grant is made available to help tenants consider the management options and then to provide support through the RTM process. RTM grant will fund 100% of the cost of an application for grant for Options Studies, Pre-Feasibility Studies and Feasibility projects. RTM grant will also fund 75% of the cost of an application for grant for a Development Study, the remaining 25% of the funding being provided by the local authority.

RTM grant is also available to an agency to promote RTM to tenants’ groups. Information is available on the role of the agency and a List of “Approved Persons”.

RTM Grant supports the RTM process through the following stages (guidelines for the timescale of each stage are given in brackets).

Either 1a Options Study (6-9 months)
RTM grant is available to enable council tenants to work with an agency to undertake an Options Study where tenants want to consider tenant management under the RTM. Tenants’ groups appoint an agency to help the group to consider issues of concern to tenants and the various ways the tenants could become involved in the way their homes and estates are managed. The agency will offer advice on the tenant management options and, if appropriate, will help serve the RTM Notice. The grant is paid to the agency for work carried out on behalf of the tenants’ group.

Options Studies for tenant involvement that are not expected to lead to the tenants' group serving a RTM notice on the council and setting up a TMO are no longer generally available to tenants' groups.  Detailed guidelines for Options study grant are available.

Or 1b Pre-feasibility Study (3-6 months)
Where a tenants’ group has decided that it wishes to exercise the RTM, grant is made available through an agency to carry out a Pre-Feasibility Study. This will provide the group with initial training and will carry out other preparatory work to help them serve the RTM Notice on the local authority. Additional information on this funding stream, including details of the application and grant claim processes for a Pre-Feasibility Study are provided in the Pre-feasibility grant section.

NB:  RTM grant is generally available for EITHER an Options Study OR a Pre-Feasibility Study.  Only in exceptional circumstances, e.g. where the tenants’ group is completely unconstituted at the beginning of the Options Study, will RTM grant be made available for a short Pre-Feasibility Study to be carried out after the Options Study has taken place.  This will enable any additional work required  to enable the RTM Notice to be served.  The grant available for the short PFS will be limited to no more than 50% of the cost of an equivalent full PFS.

2 Feasibility Study (6-9 months)
RTM grant is paid to a TMO, through an agency, after tenants have exercised their RTM, to carry out in depth work to help tenants to decide how much involvement they want, which option is best for them and if it will work. Additional information on this funding stream, including details of the application and grant claim processes for a Feasibility Study are provided in the Feasibility grant section.

3 Development Study (18-24 months)
RTM grant is paid direct to a TMO to cover the costs of the development stage of the RTM process, which includes negotiations on a Management Agreement with the local authority to take over elements of the management of the tenanted properties. The TMO must employ an agency in order to assist with such things as ensuring the group is competent to manage, the registration of the TMO and the negotiations with the local authority over the management agreement. Further guidance on the role of the agency is given in the section The role of the agency. Additional information on this funding stream, including details of the application and grant claim processes for a Development Study are provided in the Development grant section.

4 Promotion Pool
RTM Grant is paid to an agency to provide information and advice to tenants’ groups on the various options available under the Tenant Empowerment Programme. Additional information on this funding stream, including details of the application and grant claim processes are provided in the Promotion pool grant section.