Mopping up regulation
The probable merger of the TSA and HCA could clean up the legislation, says Hugo Stephens, partner and head of housing at Cobbetts
The dissolution of the Tenant Services Authority and its likely merger into the Homes and Communities Agency means the wheel will have turned full circle, and once again, the investment and the regulatory arms of the housing body will be handled by the same agency. However, the Housing and Regeneration Act 2008 gave the HCA considerably broader investment powers than those of the old Housing Corporation, and also changed the regulatory regime that the TSA has done so much to develop.
The merger
The merger will undoubtedly present a number of legal and regulatory issues during the bedding-in period, which will concern many - not least lenders. They have repeatedly stated that they derive great comfort from the fact that housing is well-regulated. In a time when access to funding is still ‘challenging’, adding to their concerns by making changes to the regulator could have unwanted repercussions on funding for registered providers.
The merger will not, however, mean an abolition of regulation. Housing minister Grant Shapps made that clear in his speech at the Chartered Institute of Housing’s conference in Harrogate two weeks ago - although he did say that he was looking at whether all the TSA’s powers would need to be retained. We will have to await the result of the consultation announced by the minister at the conference for the details, but he was at pains to reassure funders that their concerns would be given full consideration.
So, the short-term issue is the lack of certainty. Funders will want to be sure of the regulatory position and that the TSA will continue to act forcefully when required until it is formally dissolved and its powers transferred.
New legislation
The minister confirmed that there will be a period of consultation, and the necessary legislation will be included in the Decentralisation and Localism Bill in the autumn.
This requirement for primary legislation presents an opportunity to resolve an issue that has arisen under the Housing and Regeneration Act 2008.
The act requires a registered provider of social housing to actually own (or take steps to own) social housing. But many of the housing groups have non-asset owning organisations as their parent bodies. As a result, the TSA had to publish transitional provisions requiring these non-asset owning parents to either acquire some social housing or de-register. Given the popularity of such organisations, the government may take this opportunity to rectify the problem.
In the short term, the time and cost implications may seem not to justify the result, and there will certainly be no immediate savings. In the long term, however, the merger should enable closer co-operation between the investment arm and the regulatory one, providing a single point of contact for organisations involved in housing - to everyone’s benefit.
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