Ask the Experts blog
What affordable rent really means
Traditionally, intermediate rent housing (at 80 per of market rent) has been developed for key workers who are unable to afford to buy or rent a home in high value areas; rather than for the groups that have traditionally rented social housing. It is likely that this will continue to be the case with the new intermediate housing predominantly being built in high value areas and rented to working households with relatively modest means.
Two distinct tenures will therefore develop for two different groups. Increased numbers of intermediate homes will be provided for working households with modest means while the stock of social housing will continue to decline because of right to buy sales and the re-letting of homes at intermediate rents.
The fact that intermediate rents and social rents are already similar in low value areas means that the new policy will not bring forward any additional homes in these low value areas.
In high value areas – especially London – there is a significant difference between social and intermediate rent and significant demand for intermediate rent homes. It is likely that the policy will have its most significant effects in London and other high value areas in bringing forward more intermediate homes but at the same time reducing the stock of social housing. There are fears that this could lead to people who need social housing having to move out of high value areas into low value areas. This would include a gradual exodus of social tenants from inner London.
The programme is said to be open to local authorities as well as housing associations. However, the government’s self-financing proposals for local authorities include the introduction of a borrowing cap that would effectively prevent local authorities from undertaking any new borrowing and therefore prevent them from doing any new build. The headroom that the previous government intended to create for local authorities to fund new development by using a 7 per cent discount rate in calculating opening debt with self financing will now not be created as the present government has decided to use a 6.5 per cent discount rate.
There are those in the sector who consider that the provision of additional social homes should be a higher priority than the provision of additional intermediate homes. This is certainly the view of elected members in a number of authorities and the view of board members in a number of housing associations. They may wish to look at ways of developing social housing without grant. One way of doing this would be to develop to building regulation standards rather than to Homes and Communities Agency standards.
A housing association chief executive recently told me that he regarded the Homes and Communities Agency standard as adding significantly to costs while providing nothing that would be valued by tenants. In contrast a civil servant at Communities and Local Government told me that developing at building regulation standards would be regarded by government as a backward step. It will be interesting to follow developments here.
Finally – will the policy deliver the 150,000 new homes that the government would like to see? Many in the sector have suggested that with the banks still unwilling to lend at favourable terms this will not be the case.
Adrian Waite is managing director of management consultancy AWICS and a member of Inside Housing’s expert panel covering management, finance and strategy. A full briefing on affordable rent is available on his website
Has equality gone as far as it can? Clearly not.
Equality for women in the workplace has gone as far as it can go. So there is no need for further legislation. A target of 50/50 is hopelessly unrealistic because fewer women than men want to be senior managers. So says Catherine Hakim a sociologist at the London School of Economics in a report to be published by the Centre for Policy Studies.
Of course this doesn’t fit with the evidence on equal pay produced by the Human Rights Commission which can be summed up as the gap is closing so slowly that without further legislation it is unlikely to have closed for our great grand draughts never mind our daughters. There is evidence that some women, partially those with family commitments have the ability but not the desire to be senior managers but this is also true of a growing number of men. This lack of ambition should in its self prompt questions such as what is it about senior management that is turning some very able people off? Then there is the anecdotal evidence that women are losing out in management restructurings designed to reduce the overall number of management posts. Its middle management posts that are being cut the very areas women have successfully occupied in the public sector.
Restructurings results in redundancies but also opportunities. In my experience men respond to these opportunities by banging in an application if nothing else it will show them I am ambitious. They are not put off by the range of responsibilities, gaps in their experience or the significantly higher salary. The thinking seems to be why not me and if they appoint me then obviously they think I can do it after all no one is expected to know everything from day one. Typically when I have asked able female colleagues why they did not ably for a senior post in the new structure they have been put off by the high salary. One such colleague summed this up by saying for that sort of money they will expect too much. The women I worked with as a coach and mentor had a tendency to focus more on their lack of experience in some aspects of the job and have unrealistically high expectations about what someone new in the post ought to know and be able to do from day one.
The current wave of management restructurings involve merging services resulting in fewer managers but with greater spans of responsibility won’t inhibit the over confident from applying but might put off those concerned about their lack experience and knowledge of services they would be responsible for.
So has equality gone as far as it can? No clearly not. Do we need legislation to speed up change? Clearly we do. Is a 50/50 profile of senior management teams an appropriate and realistic target? No because in areas like local government the workforce is 80/20 in favour of women so why would the target be 50/50?
Blair McPherson is author of An Elephant in the Room - an equality and diversity manual, and Equipping Managers for an Uncertain Future both published by www.russellhouse.co.uk .
Inside Housing’s Women in Housing special issue is published tomorrow.
What you might need to think about in 2011
The season for vintage comedy has been in full swing. During one Laurel and Hardy rerun, I’m sure I heard Oliver Hardy say to Stan Laurel, ‘This is another fine Pickles you have got us into’ – although that might have been the sherry!
Now Christmas is over, secretary of state for Communities and Local Government Eric Pickles’ plans are no laughing matter for housing professionals.
So what are the landmark issues for 2011? The Decentralisation and Localism Bill of course, the finalising of the Homes and Communities Agency guidance on the new grant regime, the finalising of Universal Credit are the obvious ones.
Here are the points I think housing professionals need to get serious about:
1. Localism means you need for local market knowledge:
With the introduction of new ‘affordable’ rents up to 80 per cent of market rents on new developments and up to one in four re-lets, it is important that development teams start with an excellent understanding of local housing markets.
What are the local factors that make any new homes attractive?
Excellent market awareness is important if new funding contracts with the HCA are to heavily depend on matching homes to customers who are within striking distance of a market rent i.e. the private sector. Are our new homes going to be sufficiently attractive to private renters at this discount?
How robust is the market understanding in the varied local authority areas that larger associations work in? We have come a little unstuck on this in the past with low cost homeownership homes that we have not been able to shift as a result of falling demand. It may be the case that the market place for renters at higher rents is not the same as those we have dealt with on the low cost home ownership front.
2. Benefits could come with getting to know local authority decision-makers:
It will become more and more important to get good ‘inside’ knowledge of how local authorities are making their decisions. With big cuts in the pipeline for local authority services, it would be extremely worthwhile for housing associations to have excellent formal and informal links with key local authority colleagues.
The potential for helping share some of the ‘pain’ by offering, for example, a service or a small amount of cash, might pay dividends, particularly if this generates opportunities for further partnership working or just a ‘feel good’ factor about ‘association X’. This is particularly important if nominations agreements need to be renegotiated.
Unfortunately this is time consuming and should probably extend beyond sitting on the formal liaison boards. It’s also a challenge to associations with a large number of local authorities to talk to.
3. Loan to value ratios need careful consideration:
Some associations’ gearing covenants i.e. the upper limit, set by the lender on a borrowers total borrowings, but which is off-set by the reserves and grant, may start to look a bit shaky as grant diminishes.
Gearing limits are usually set into loan documentation and have an upper limit.
A common calculation for gearing is loans/reserves and grant, but with less grant in the equation, the gearing figure increases and may not be off- set by a bigger cashflow from higher rents.
So closer monitoring of gearing covenants is essential. Some forward thinking about when gearing covenants might start to nudge up to the limit, if the grant goes down, might pre-empt a discussion with lenders; which these days often means a re-pricing upwards by our banking friends, and so is to be avoided if possible.
4. There could be an opportunity for small housing associations to take on more work:
As localism gets some traction with local authorities, the sheer scale of making this work effectively over a large number of local areas might mean that larger associations will want to consider devolving housing management to more local, smaller associations. This is an opportunity for those who have argued that smaller associations have better links with communities.
So smaller HA’s might want to consider talking to larger housing associations and vice versa about managing homes contracts.
Perhaps organisations could consider setting up a wholly-owned commercial subsidiaries to manage non-charitable housing schemes? Income could be remitted back to the charity via Gift Aid.
5. Taking repairs and maintenance work in-house could be an option:
With VAT having increased to 20 per cent, this might be is a good time to start thinking about what advantages an in-house, direct labour organisation might make.
The headline advantages are:
- no VAT and
- better control over the quality of work
But setting up a DLO will require some planning and building up skills in-house. Depending on size of your organisation, perhaps start small and build up the team. What about starting with re-lets with an in-house team dedicated to do re-let repairs and decorations for example?
Don't shoot the messenger
Last week I posted a piece about those workers in care and support roles who abuse the system and their service users by wilfully holding down two or more jobs on concurrent hours.
There was a range of responses, from the person who acknowledged world-wearily that this has been going on for years, to one or two who suggested that my only motive in raising the issue is to drum up more business for Real People.
Just to put the record straight, Real People is not a personnel consultancy business as such; it’s a social enterprise, the primary objective of which is to help raise people management standards in the sector. It is part of Broadway, the homelessness charity, of which I have been HR Director for many years. Yes Real People does generate some income to be gift-aided into Broadway’s work with our homeless clients, but if I were writing articles with a view to generating consultancy business, I would stick to writing bland ‘apple pie and mum’ advice about non-controversial issues.
I acknowledge the response from one person that management must take a lot of the blame; I would not deny this and have written many articles about the need for improved people management in service provider organisations. I also acknowledge that the majority of those working in care and support are hard-working, committed people and the ones I’m talking about are a minority. But they are a very significant minority. And the first task of good management is to select only the right people with the right attitudes to do the best by their service users and keep all the rest out.
My sources of information on this significant minority of fraudsters, cheats and abusers (which I would estimate to be in the region of 15% on average across all social care services, including elderly, homelessness, mental illness and learning difficulties, substance misuse) are myriad, of long-standing, and reinforced by new examples on a weekly basis. I could write a book but here are a few recent examples:
- Despite the fact that at Broadway we have very stringent recruitment and selection standards and techniques, every year we withdraw an average of 25% of our job offers when our referencing throws up a history of wrong-doing on the part of the candidates. The majority are front-line staff whether we like it or not.
- A recent example was someone currently working in a hostel for elderly homeless men who our researches revealed to have been struck off the nursing register a few years ago for abuse and neglect of elderly patients – including, leaving an elderly person to lie soaked in urine while he made phone calls.
- We recently inherited thorough TUPE a support worker who it transpired, after a bit of rudimentary detective work, had been holding down the roles of assistant project manager for one homelessness provider and support worker for another, on concurrent hours. The astounding thing was that this had been going on not for 13 weeks or 13 months but for 13 years. Thirteen, unlucky for some – in this case, as with all others like it, the service users. Of course the management (or lack of it) that allowed this to happen holds a very large degree of the culpability here, but that doesn’t take away from the fact that individuals like this must be held personally accountable for their own dishonesty, and we must take vigilant measures to keep them out of our services.
Whether I write under my Broadway hat or Real People hat, I’ll remain dedicated to promoting the necessity for good people management, support and staff development in all social care services, and highlighting examples of good practice as well as poor.
I, like plenty of others, am fed up to the back teeth with seeing people like the above getting around the sector with impunity because of their own dishonesty and the negligence of employers who don’t do thorough staff selection and pre-employment screening and don’t manage staff performance properly. As the other respondent I refer to said, it’s been going on for years, and I won’t keep quiet about it until I see a change.
Abuse of the elderly
A friend of mine working for a community project recently went round picking up elderly people from their homes to take them on a day trip. When he arrived to pick up a resident from a home run by the care subsidiary of a large group RSL he was shocked to find what he did. The elderly man sitting looking forward to his trip but unable to go as he was soaked in urine where he clearly hadn’t been changed for hours, the care staff nowhere to be found and, when they were found, an attitude of non-interest and non-committal. When he went in to the old man’s room he saw and smelt a scene of squalor which told him that leaving residents unchanged and unclean was the order of the day.
This is an example of the shoddy standards that are to be found in all too many services for vulnerable people within our supposedly caring and professional sector. And I can guarantee that the most cursory of investigations into what’s going wrong will reveal a home or a hostel where there are – perhaps - one or two reliable and committed staff who are totally overworked in teams where there is a great deal of wrongdoing going on among their colleagues. Some of those colleagues are seldom in work and when they are they aren’t doing what they’re supposed to. Much of the available management time is diverted into dealing with specious grievances and half-cocked disciplinary investigations (the latter often ditched when management loses its bottle in the face of vexatious counter grievances).
One of the most common scams is the staff who have two jobs (or more), often both full-time, running over concurrent hours, in two different organisations. This particular brand of fraud is endemic in the care and supported housing sectors. In many cases these staff get away with it for years, begging the question why service managers and HR don’t spot the signs and start some close undercover investigation the minute they have any grounds at all for suspicion. Or why the hard-working staff who must have their suspicions don’t feel able to report these.
These are some of the things you need to be alert to:
• The candidate whose references shows a pattern of intermittent persistent short-term and longer-term absence, and shouldn’t therefore be taken on in the first place. Or conversely Word Art or other fake references compiled by friends which show a suspiciously over-clean record of attendance along with other tell-tale signs. Line managers and HR staff must be trained to spot dodgy references.
• The worker who is forever swapping shifts and coming up with last minute excuses for inability to attend work or certain activities. And then goes off with a long-term illness.
• The person who is absolutely inflexible about changing their pattern of work in any consultation around changes to service provision, often citing their responsibility for a dependant as the reason. Honest, hard-working people with carer responsibilities are always prepared to consider some flexibility.
• The behaviours above are frequently accompanied by a specially cultivated style of interpersonal aggression, framed around the language of harassment or discrimination, designed to make managers back off asking any awkward questions about absence.
Where you see any of these signs, you should start making discreet enquiries to get to the bottom of what’s really going on, hiring a private investigator if necessary.
Moonlighting to draw down two salaries while not putting in a full week’s work with either employer may be as old as the world of work itself, but in social care it leads to abuse, neglect and death and as a sector we have a duty to stamp it out.
What this means for choice, independence and dignity
Service cuts, changes in housing benefit, reduced funding for Supporting People and new rules for disability benefits disproportionally affect social housing tenants and combine to reduce choice, threaten independence and undermine people’s dignity.
The choice for many elderly or disabled people will be become a burden for your family which you don’t want to do or go into a “Home” where you don’t want to go.
People have more control over their own lives and retain their independence in their own flat with their own front door. Where as in a residential home they quickly become institutionalised fitting into the routine of the place, doing not what they want to but what makes life easier for the staff.
The loss of choice and independence is quickly followed by the loss of dignity. It’s hard to retain a sense of self worth and pride when you are surrounded by confused and incontinent “Residents”, when you have no real privacy and when people are “Toiletted” before and after every communal meal and bathed once a fortnight.
Public sector budget cuts at a time of growth in the number of older and disabled people means that thoses without the money to buy care and support will endure rather than enjoy life.
The greatest post war achievement of the public sector was to extend life we now risk making thoses extra years a misery for many.
Root of all evil
The economy is a mess, the national debt out of control. If we want to know why we need to look no further than poor people management – the root of all the evil that has beset the commercial sector (think about the banks and the behaviour of their ‘leaders’) and the public and voluntary sectors, under-delivering at too high costs because they employ the wrong people and don’t manage them. Many social housing organisations and local authority housing departments have well-managed and accountable staff teams; but then again many don’t, and certainly not consistently across all their services. There are those that tolerate under performance on the part of at least half of their managers and staff.
Now the sector will be forced to cut jobs, big time. Many organisations will be sad to lose staff who have made a great contribution but really can’t be afforded. But at the same time they will see this as an opportunity to shed their worst performers, and thus achieve more effective organisations which can survive and grow despite swinging cuts in income.
Thousands of people are about to be hoiked out of work. Some will fail to pay their mortgages and rents, spiral into depression and substance misuse, and will swell the homeless population. Consequently there will be a need for more social housing and associated support services.
Therefore, the organisations which are about to shed their worst performers will need to keep on recruiting new people – as remaining staff leave and need to be replaced, and as the government is forced over time to pump back more and more funding to support people out of the dire straits into which many will fall.
So will their Boards and senior executives have learned anything from the wasteful mire into which they have dragged their organisations - and ultimately the country - through their poor selection practices and failure to properly implement performance management processes? Will they therefore be able to benefit from the ‘clean slate’ shortly to be on offer once they have sliced out those managers and staff who contribute nothing but trouble? I doubt it. They know who they need to get rid of, but track record to date suggests they will fail to get their heads around how those people got into post in the first place and were able to run amok for years before their employers were presented with a watertight business reason to get rid of them.
In the meantime, the government’s notion that all the people about to be flung out of public and voluntary services will miraculously become employed in and promote the growth of a newly booming commercial sector is laughable. Get real. A significant proportion are UNEMPLOYABLE because they’ve been allowed to get away with murder for years, unchallenged in the absence of firm and consistent management within their employer organisations and protected to the hilt by an employment law regime which has pretty much scotched the concept and practice of personal responsibility for anything in the workplace.
Helen Giles is a member of Inside Housing’s expert panel, focusing on human resources and staff development issues. Ask Helen a question in the forum
Recipe for disaster
So the government is supporting the running of public services by co-operatives. Oh the immutable nature of human folly! I daresay most of them are too young to remember the heady days of the 1970s and 1980s when the co-operative movement featured so large in the social housing sector that almost every other small housing association or homelessness agency were run on co-operative lines as ‘collectives’.
Millions of public pounds were slopped down the sluice while those of us employed in collectives had an extended party, or should I say bunfight. Clients’ interests always at the bottom of the agenda while we vied with each other in facilitated sessions (all paid for by housing grants) debating which group among us was the most discriminated against. So much so that one of our companion organisations, Homeless Action, was widely and affectionately known as ‘Pointless Faction’.
And like the legendary 40 Californians changing a lightbulb, it took a minimum of 18 months to get a decision on anything at all, be it tea bags versus tea leaves for the kitchen, the introduction of a new arrears policy or the taking on of a new scheme.
Every employee could benefit from at least 30 days’ per year sickness leave on top of their holidays because there was no manager to suggest you shouldn’t. And if any member of the self-managing team suggested that you shouldn’t, they were soon slapped down as an oppressor.
Many will know the story of how when Evelyn Waugh was chastised by a friend who asked ‘How can you have such a vicious tongue when you’re a Roman Catholic?’, he responded: ‘Well just imagine, dear lady, what I’d be like if I wasn’t a Roman Catholic.’ And so the government might say that slowness in decision-making, waste, and poor customer service have been a feature of public services when they’ve been run within hierarchical structures, to which I would reply, just see how bad it can get when you do away with management. Or flatten it out. They just have to come and ask those of us who were there the first time around to see the failure of the Utopian dream.
Helen Giles is a member of Inside Housing’s expert panel, focusing on human resources and staff development issues. Ask Helen a question in the forum.
