Crisis talks are underway to minimise the fall-out from the collapse of a housing charity based in Preston.
Three councils - Preston, South Ribble and Lancaster - are all involved in “urgent” discussions with Methodist Action (North West) to prevent more than 150 tenants being made homeless.
The award-winning charity, which has its headquarters in Penwortham, put itself into voluntary liquidation on Tuesday due to cash problems.
The future of its tenants, and up to 50 private landlords who have leased houses to help Methodist Action’s work on homelessness under the banner A Place To Live, is unclear.
So too is the effect it will have on the homeless shelter it runs in Fox Street, Preston, where staff say they are “working on a solution to sort it out.”
Two concerned property owners who have contacted the Post claim alarm bells were ringing more than a year ago about the running of the charity which is independent of the Methodist Church.
One, Nigel Brook, who leased his late father’s house in Waterloo Road, Ashton, to the organisation in 2013, said: “It became apparent to me in 2018 that Methodist Action were not adequately managing the property and were not paying the full agreement rent into my account.”
Mr Brook said he believes Preston Council must have been aware of ‘mismanagement’ by MANW before now, but cabinet member for communities Coun Nweeda Khan insisted: “I certainly wasn’t aware there were any problems.”
Another landlord, who owns 13 properties on the Methodist Action books, revealed she had gradually reduced her portfolio from 27 over the past two years because of concerns she had about how the charity was being run. “I knew they were being mis-managed and so I’ve been taking my properties back slowly,” she said. “I knew they wouldn’t be able to sustain it the way they were going.”
Methodist Action, which has its roots in the congregation of Preston’s Central Methodist Church in Lune Street, dropped the bombshell on Tuesday afternoon in a letter to landlords.
The statement said: “The board of the charity met on Monday evening with an insolvency practitioner and in view of the financial position has resolved to place the charity in voluntary liquidation.
“Although you will receive information directly, we wanted to write to you in advance to let you know we are holding urgent discussions with local councils to discuss the process of sorting out our leases with you so that you will not suffer financial loss and our tenants will not be made homeless.”
The charity has been working in partnership with local councils for the past decade to provide affordable housing for homeless individuals and families.
Private landlords taking part in the scheme lease empty houses to Methodist Action and receive a portion of the tenant’s housing benefit in the form of rent.
Nigel Brook explained: “I was approached by Preston City Council and introduced to their Empty Homes Project in 2013 after my father vacated our family home due to illness and subsequent bereavement.
“As I work overseas I was happy to accept their proposal to have the property both renovated - at my own cost - and let through MANW, particularly as Preston Council had emphasised their partnership with MANW to deliver their Empty Homes Project.”
But he became concerned things were not going smoothly as long ago as 2017 when the house appeared to be deteriorating in condition and repairs were not being carried out. Mr Brook and other landlords are now seeking legal advice over what to do next to protect their properties.
The owner of 13 houses on the charity’s books, who asked not to be named, added: “As of yesterday between 40 and 50 landlords have no access to their own properties and the tenants effectively turn into squatters.
“Many of these tenants are vulnerable people and they are now living in properties where they don’t have a contract anymore. This charity was set up to stop vulnerable people dropping through the cracks in society and to get people off the streets.
“As landlords, we leased our properties to Methodist Action to use for housing these unfortunate people and for that we just get housing benefit when all costs have been deducted.
“I’ve talked to other landlords and they are clambering to get legal advice over what to do next.”
Fox Street Community
Desperate attempts are being made to save Preston’s Fox Street Community following the collapse of Methodist Action.
The refuge provides a shelter for up to 20 homeless men in the city centre and has been operating since 2008.
And as soon as staff were informed of the charity’s liquidation, talks began to find a solution aimed at keeping the hostel open. A spokesman told the Post: “We don’t know really what’s going on at the moment.
“This is very much in the early stages.
“But we are working on a solution to sort it out.
“Hopefully Fox Street is not going to close.
“Meanwhile the place is being run as normal and we will just have to see how we go on.”
The charity supports the homeless and disadvantaged across Lancashire.
It has its roots in Preston dating back to 1978 and social action projects on homelessness being carried out by the congregation of the Central Methodist Church in Lune Street. But it is independent of the church itself.
In 2015 its Empty Homes programme renovated 107 properties and brought 222 bedroom spaces back into use. Their work with the homeless led to the foundation of the Fox Street Community in 2008 and then the establishment of a charity to work as an umbrella organisation.
Methodist Action (Preston in Central Lancashire) was set up in 2010 and a year later the charity changed its name to Methodist Action (North West) Ltd.
Councillor tells of shock at collapse and denies knowledge of troubles in 2017
A leading Preston Council member admitted she was “shocked” by the sudden demise of Methodist Action.
But Coun Nweeda Khan, who is cabinet member for communities and social justice, hit back at suggestions that the authority had known the charity was in trouble as long ago as 2017.
“That’s news to me,” she said. “I certainly wasn’t aware there were any problems.
“As far as I knew they were functioning very well and were delivering what they should have been delivering. We have been working very well with them.
“This has come as a big surprise. It is shocking. And I have every sympathy with the tenants and landlords who are affected by this. They are very important to us.
“We are 100 per cent doing all we can to help and we are working with them to find a solution.
“But it is early days at the moment and I’m not really in a position to give any further information.”
Preston City Council has been in partnership with Methodist Action through its Empty Homes Project, finding accommodation for the homeless.
In Lancaster and Morecambe, the charity worked with the city council to provide affordable homes for tenants in urgent need of help. A spokesman for the authority said: “We are aware of the situation regarding the liquidation of Methodist Action North West.
“The council is holding urgent discussions with MANW to assist in finding a solution to ensure the affected residents’ homes are secured.”
And in South Ribble, Coun Matthew Tomlinson, cabinet member for finance, property and assets said, “We are aware of the current position of Methodist Action North West.
“We have a very small number of properties which could be affected and we will be meeting with them as soon as possible find out more about the situation.”