Corporation should have stopped this nonsense

Having looked closely at the performance of the Housing Corporation I do not believe that the mechanisms are in place to stop a repeat performance. The players and the circumstances may be different but without stronger leadership and regulatory enforcement the results could be the same.

In the case of Ujima, the homes of more than 5,000 families were put at risk. Because of the impact on my constituents, I have investigated what happened in some detail and have been shocked at what I found.

After my prompting, the police are investigating allegations of criminal activity and have made three arrests.

But what of the corporation? Research by this magazine has revealed that it has had to do more with fewer resources. But despite this overstretch, it is my firmly held belief that the corporation failed in its duty.

According to whistleblowers I have spoken to, the corporation was told that Ujima was breaching its loan covenants in January 2007. How could the regulator have known this, yet still given Ujima a clean bill of health for viability the following June? Six months later Ujima had plunged into the red. Ujima became known in the sector for its grandiose schemes, such as Project Jerusalem. Its aim? To become one of the top five associations within five years. The corporation must have been aware of this nonsense — it would have demanded £1 billion worth of investment each year for five years. The considerable concern within the sector about what happened at Ujima isn’t fading. The corporation’s approach to regulation is set to form the backbone of Oftenant — the new regulator of social housing. If things do not change quickly, this sector is in for a very bumpy ride.