Let's have a debate on the future of social housing regulation - here are my first thoughts

Since the Cave Review more than ten years ago regulation has been built on two plinths:

– Finding a way to mimic shareholder pressure and

– Treating tenants as children.

After the hapless floundering of Carillion, the eye watering greed of Help to Buy pay-outs to directors of so-called housebuilders and the egregious failures of train companies, the first plinth is gone. We need to find a better way of stimulating the right sort of behaviour.

Cave decided to call the report Every Tenant Matters which is a bit like another report of the era called Every Child Matters. Of course Every Child Matters dealt with the steps we needed to take to prevent another case like Victoria Climbie. But the choice of title set the tone for housing that applies today. What is the job of the regulator? It’s to keep tenants out of harms way. Just as you would with a child. Many tenants I speak to are angry about this. Good.

The Green Paper that is about to come out as part of the response to Grenfell is a chance to set a different tone.

It’s time to treat tenants as equal partners and reject the simple notion that the market solves all problems.

Here are my first thoughts. There are two models. One spells things out in a lot of detail. The other keeps it at a high level. I am just looking at housing management for now. You can make a case for going upstream and looking at strategy and development. But that’s for another day.

None of this brings in any extra money. So it is not a panacea.

Do you think these principles will help or get in the way?

What are your ideas?

Option One – Detailed regulation

Pros: Clear set of rules

Cons: May be expensive to operate

Some professionals are hostile to any echo of the Audit Commission regime:

  1. Keep social housing safe and in a good state of repair (based on objective survey data – safety not limited by restrictive interpretations of current law – proactive approach needed – end of bare compliance culture)
  2. Landlords must not behave in monopolistic ways (by abusing the power imbalance or taking undue advantage of housing shortages)
  3. Add to the net supply of housing each year in areas of need (in line with targets agreed with councils)
  4. Act to boost affordability (don’t inflate land or house prices, including 106 prices, and private rents – don’t use service charges to circumvent national rent policy)
  5. Ensure there is a strong tenant voice with the same access to professional advice as landlord bodies
  6. No social housing buildings, revenue and balances to be used for any purpose other than social housing and closely related activities (to be defined – it will change over time)
  7. Requirement on boards, councillors, executives, staff and contractors to treat tenants with respect – regulator to promote the interests of tenants, not landlords
  8. Regulator to have sufficient resources to spot and deal with problem cases directly (avoid conflict of interest of consultants)
  9. Regulator to publish online in an easy to use format key comparative data on landlord performance
  10. Regulator to assess the housing management performance of landlords on an objective basis (self-assessments from landlords can be part of the evidence base)
  11. Regulator to ensure management costs and service charges are appropriate – not just rents
  12. Ditch the distracting vagueness of co-regulation: the board is in charge, it must regulate itself – if it fails to do so the social housing regulator should step in and act as a police force not a partner
  13. Mergers and trading ventures should make the returns specified in advance or face consequences (where losses/shortfalls are incurred these must be recovered in full from the sponsoring executives, councillors and board members – bonuses cannot be a one-way street)
  14. Applies to councils as well as associations (the aim is to prevent another Grenfell – tenants in K and C say they had no influence over the Council due to their low numbers – so the electoral safeguard did not apply – the ballot box is not a failsafe – we need regulation).

Option Two – High level regulation

Pros – simplicity of aims

Cons – open to interpretation – pressure on regulator or third parties to fill in the detail

  1. Keep tenants safe
  2. Ensure the landlord stays solvent
  3. Build affordable homes

This should also apply across councils and associations.

By Alistair McIntosh, HQN Chief Executive

We are keen to hear the thoughts of our members on this issue. Do you agree with the points raised by Alistair or do you have you own suggestions? Do you believe the regulation of the sector needs fundamental change, and if so how should these changes be implemented? Please leave your thoughts on our dedicated members' forum (you will need your Housing Quality Network members' login), or if you prefer your response to be private you can email us at thenetwork@hqnetwork.co.uk.