New standards mark shift to economic regulation
Social landlords will have to comply with a value-for-money standard as part of a new regulatory framework published yesterday.
As Inside Housing revealed last week, there are several major changes to the role of the regulator ahead of the transfer of regulatory responsibility from the Tenants Services Authority to a new committee in the Homes and Communities Agency on 1 April.
The changes to the framework will reflect the future distinction between economic and consumer regulation. On the economic side, the committee will seek to ensure the financial viability of private providers and will scrutinise boards for the effectiveness of their oversight.
Meanwhile, on the consumer side, the regulator will take a more hands-off approach and will only intervene on delivery of services if there is potential for serious harm to tenants. As part of the government’s localism agenda, tenant panels, councillors and MPs will be expected to deal with minor breaches of consumer standards.
As Inside Housing reported last week, part of the framework has been redrafted following criticism from landlords and other organisations.
The changes from the draft document include the dropping of a requirement to demonstrate that providers have examined alternative delivery models, including mergers or third-party contracting, to improve value for money.
Anthony Mayer, TSA chair, said: ‘Although the government has required significant changes to the 2010 standards framework, this new framework retains at its core the principle of co-regulation.
‘Boards and councillors are responsible for the viability and proper governance of their organisations, and the effective service delivery and accountability of their tenants.
‘The TSA board’s top priority has been to ensure that we develop a regulatory framework that will maintain the confidence of all those with interests in the sector - whether landlords, lenders and investors, taxpayers or tenants. The priority is to ensure that social housing businesses are well run and can withstand the challenges of a difficult financial environment and housing market for the long term.’
Julian Ashby, chair of the HCA’s new regulation committee, said: ‘We are grateful to the TSA for giving the regulation committee the opportunity to influence the new framework following the closure of consultation. We now look forward to working with the sector on its implementation. We will focus on governance, viability and value for money in response to increasing risks in the operating environment.’