2019 has had a lively start in terms of housing regulation and as we continue to await the government’s consultation of the Hackitt Review and the Social Housing Green Paper, there are several changes social housing providers should keep abreast of.
In March, the National Housing Federation (NHF) launched their “Together with the Tenants” initiative aiming to strengthen the relationship between tenants and housing associations. Housing associations boards are required by the NHF Code of Governance to be accountable to their tenants and residents. Tenants and residents should be clear what to expect from their housing association landlords, and tenants can then report on how landlords are performing against these commitments. Further to this, the NHF are advocating a ‘Voice for Tenants’ steering group that would provide a strong national voice for social housing tenants and residents. Members of the NHF should fully consider the proposals set out by the NHF which have encouraged housing associations to contemplate how they would implement the process.
There have been some policy updates as well:
In March ‘The Fitness for Habitation Act’ passed into law and supplements ‘The Landlord and Tenant Act 1985’ that deems a property unfit for tenants and adds ‘any prescribed hazard’ as described in the housing health and safety rating system. There has been a recent increase in repair claims due to greater awareness on tenants’ ability to claim, and this is likely to further increase claims against landlords. Therefore, providers need to ensure all properties meet the new legislation while continuing to satisfy the Decent Homes Standard.
On 28th March 2019, the RSH updated the ‘Regulating the Standards’ document which sets out the approach the RSH takes to regulation, what providers can expect of the regulator, and how the RSH ensures that standards are being met. Key changes from the updated April 2018 document are:
- more frequent (biennial) In Depth Assessments for the largest and most complex providers;
- increased ownership by boards of stress testing as well as demonstrable understanding of how the economic cycle and individuals shocks impact their organisation;
- and the RSH being authorised to issue an interim regulatory judgement on providers deemed to have undergone significant constitutional change or a group restructure.
In February 2019, the government set out its plans to increase social housing rents by consumer price index plus 1% for five year from April 2020. The RSH has drafted a new Rent Standard which outlines the management and rent setting for the new rent settlement plan. The current 12-week formal consultation ends 30th July and allows social housing providers, tenants and stakeholders to feedback on the draft Rent Standard. Although very much welcomed by the sector, external risks such as a downturn in the economy and/or the impact of Brexit on the housing market may force the government to increase rents at Consumer Price Index (CPI) – rather than CPI+1%.
It is now a year since the RSH updated the VfM standard, to include mandatory reporting on 7 metrics. While a lot of the attention of the new standard is on the numbers and benchmarking, the RSH remains focussed on organisations fully embedding VfM at all levels, so the story alongside your metrics is critical in displaying to the regulator your organisation fully embraces VfM. .
Overall, the RSH wants RPs to perform efficiently, and demonstrating that is as much about understanding what drives your costs, as it is about keeping those cost low in a race to the bottom.