Warwick Building Service Charges increase by 40% (yes, fourty)! CBWRA announces no action to be taken on audit or in challenging electricity costs

The latest service charge demands from Rendall and Rittner show that service charges will increase by 40% for the year commencing 1 April 2023. My service charge has increased from £ 247.71 to £347.05 a month (40%). Do your own calculations here using this online calculator.

The average rate of inflation in 2022 was around 10% and is currently declining, forecast to be 6% over whole of 2023. It is true that energy costs have increased at a rate well above inflation and energy costs are a significant part of the internal block costs but why have Rendall and Rittner estimated that electricity costs for Warwick 1 to 3 will increase from £70,000 (2023) to £255,000 by end of 2024 which would be an increase of 264%?

Whatever way you look at it, this increase makes no sense at all and must be challenged. That requires a proper audit of the service charge accounts and challenging unjustifiable costs and practices, using professional advice from an expert (preferably not one that has given residents incorrect advice about Right to Manage and not one which charges £250 an hour despite not being a qualified accountant). I identified a management audit as priority on my manifesto for 2023 Chair elections and while on the CBWRA committee (for most of 2021) I argued constantly for a full management audit, but this was blocked by on the spurious ground that it might damage the objective of a ‘collegiate relationship ‘ with Rendall and Rittner and scare tactics were used such as suggesting that the an audit might cost £70,000 (based on no evidence at all) . An audit was again promised in January 2022 but nothing happened until late 2022 when Roger Southam was asked to carry out some sort of preliminary audit. Although we know that the findings were not good for Rendall and Rittner, the CBWRA committee has refused to shared the report with residents and now says (CBWRA committee meeting notes March 2023) that:

”No action is to be taken on this for the moment. The Treasurer is preparing the RA accounts and a draft budget for the next year. We need to collect subscription fees. App is the biggest cost although a reduced price was negotiated by the Treasurer for 2023. The RA also needs funds for any costs that might arise out of RTM. Therefore, before committing to other line items such as the accounting audit, it has to be clear that there are funds within the budget.”

Putting on one side the fact that residents have not been consulted (as ever) this of course is total nonsense. What is a higher priority than challenging the inflated service charge costs? And what money is currently being spent on Right to Manage? None of course because CBWRA is nowhere near being able to initiate a Right to Manage application, which requires having 50% of leaseholders signed up (not to mention the contract retendering which Berkeley Homes may or may not initiate which would block a Right to Manage application in the short term). They have also subsequently engaged Urang ( a form which I located and directed to the committee) to handle the RTM application, and Urang are not charging any fees up front and this is in effect a ‘no win no fee’ agreement.

It should also be possible to find a consultant who will take the audit forward on a no win no fee basis. Apparently Roger Southam originally offered to do just that but then seemed to change position – the reason given being that he would not be able to approach all leaseholders to sign them up for this deal. Again this makes no sense – why would he not be able to do so? Unless of course CBWRA did not have a list of leaseholders to share with him, or that their list is a very long way from complete. If that were the case then it would be hard to explain how they managed to ‘contact all leaseholders at least once’ (as they claimed) for the purpose of the CBWRA Chair elections.

Although they do not wish to spend money on taking the audit forward, apparently the CBWRA committee are happy to spend £18,000 on ‘seasonal community events’ whatever they may be. I would suggest that taking forward the audit as a matter of urgency might be a slightly higher priority than these hypothetical events, for which the demand or purpose is far from clear. If the CBWRA committee are going to continue with the ‘no audit’ policy then clearly residents, without resident consultation, clearly residents will need to take action themselves, because there is absolutely no way that this increase can be accepted. Please feel free to get in touch if you would like to discuss (residents@chelseabridgewharf.org.uk).

Category : Chelsea Bridge Wharf Residents' Association, Rendall & Rittner, Rendall and Rittner Commission on energy supply, Right to Manage, Roger Southam, Service charges, Uncategorized, Warwick Building
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