Unable to reset user passwords in 3.5.1

In 3.5.1 the option to change users passwords from the User management page within settings has dissapeared.
There is a reset password email check box but that seemingly doesn’t work either there is no way of restoring a users access to their account. (Email not send to user)

Is this a bug or do I need to set some form of environment variable to get it working?

This is using the open-source version.