Service charge review and cost apportionment project supporting the transition to transparent, property-specific charging across a large housing portfolio.
The client
The Royal Borough of Kingston manages a large and varied housing portfolio. The Council appointed FFT to support the transition to a more transparent and evidence-based service charge framework, aligned to the services provided at individual properties, blocks and estates.
The project
Royal Borough of Kingston (RBK) wished to move their current fixed service charge arrangements to a more reflective position of recovering the true costs from residents, moving away from a ‘pooled’ service charge. Whilst the new approach would continue on a fixed service charge for General Needs residents, supported with variable service charges to Leaseholders, RBK required support in developing the individual service charge elements at a property, block and estate level.
Our role
FFT worked with RBK to:
- Understand and identify the services provided by both in-house Direct Labour estate services teams and 3rd party external contractors at a block and estate level
- Identify the specific costs relating to each estate, supported by creating hourly rates for internally delivered services based on actual cost data
- Mapping services to blocks to provide a detailed register of all properties requiring a service charge and the amount, supported by evidenced workings of the cost build up
- Providing ongoing internal support and guidance to RBK teams and stakeholders on understanding the transition from a standard charge to an estate/block specific service charge
- Supporting on resident consultation, feedback and overall education around the changes to service charge costs and provision of evidenced based reasoning
- Providing resulting data sets to inform housing management and finance systems and formal rent notices for residents
This was a 12 month project which required a high level of involved and integration with the RBK internal teams. This included regular project briefings and updates, working with local councillors on supporting resident communication strategies. A large part of the project was also to work alongside RBK finance teams to understand the service charge recovery position, budgetary management processes and requirements for ongoing financial reporting.
Services provided
The challenges
The key challenge for this project was supporting the communication to residents and local councillors. This was a shift away from previous practice in terms of applying service charges and required a high level of cost based evidence and detail to assure residents that revised service charges were fair, transparent and appropriate for their property. This level of engagement added to the overall robustness of the project outcomes.
Added value
Due to the overall length of the project FFT was embedded with RBK and worked closely with all teams. Due to this advice was provided on a range of service charge related issues that became apparent during the project. This included assisting in the drafting of new tenancy agreements and service charge policies to support the new approach. A lot of emphasis was placed on working with finance to arrange budgets and reporting to support future service charge allocation. During the project RBK also moved from Keystone to NEC and FFT provided a range of advice and support in the development of the service charge module to be aligned with the revised approach. Additionally, the project has allowed RBK to improve financial contract management controls to ensure costs are provided for all service chargeable elements in a way which retains transparency for residents.
The outcome
From April 2025 onwards RBK have been using the new approach and apportionment of service charges based on actual costs – reducing their annual under recovery of service charges, all of which is reinvested into estate improvements an area of previous under investment. RBK have been provided with a detailed workbook which can be updated annually to set their new service charges. FFT provide a small level of ongoing annual support checking the revised service charges for 2026 / 2027.