Power to the people

Oh how we try in housing to be both accountable and commercial. We use metrics from the market to show efficiency and, when it suits, we remember our roots as small local organisation. 

As associations have increased in size we keep using terms like ‘being accountable to our community’ when we mean providing services we think the community need.  At the same time, we also talk like bankers and house builders. No wonder our tenants, our staff and political leaders are confused.

Merthyr Valleys Homes is a traditional stock transfer housing association trying to square the circle of not being the council and yet somehow being accountable to our community. 

We feel we are the custodians of the housing that had been built by the people of Merthyr Tydfil over the past 100 years.  So we believe we have this wider civic duty but we are not accountable to our community.

Merthyr Valleys Homes plan to spend £800m in Merthyr Tydfil over the next 30 years, and organisations this big need good governance as much for the tenants’ and employees’ benefit as for the regulators and the funders.   

We began a search for a new model that better suited our culture, our heritage and communities.  Over the last 18 months we have looked at lots of different structures and at Rochdale Boroughwide Housing we found a model that seemed to fit our needs.

Rochdale Boroughwide Housing has moved away from the paternalistic relationship between landlord and tenant, employee and employer, and instead has created a relationship between each that is mutual. 

Rochdale is, of course, the home of the co-operative movement, and the roots of this model are clearly co-operative. But there is one striking difference from a pure co-operative, and there is a good reason for that difference.

The Rochdale model allows only tenants and employees to be share members and they, in turn, elect a members’ body to represent them. This representative members’ body has a number of specific functions, including:-

• The membership body is elected by the members and is therefore representative and accountable
• They can appoint the chair, the chief executive and the board of directors, and can also dismiss them (this is an adult relationship and with this power comes responsibilities and constraints)
• They set the values and the strategy for the mutual organisation.

The difference between this model and a traditional co-operative is that the board of directors are appointed on merit, for their skills and expertise, not just as a result of their membership.  They bring the business acumen, the treasury management skills and experience of managing highly paid executives, all the things that make running a board difficult.  

But as the board of directors has been appointed by the members (tenants and employees), they take this responsibility on, on behalf of the members and work to a set of values and within a framework that the tenants and employees have defined.

Parallel to our search for new structures, the Welsh Rugby Union was going through a period of change and this influenced many of our employees as to the merits of a mutual model.  For those outside of Wales, the status of rugby is similar to football in England during a pre-world cup period. 

The Welsh Rugby Union is a members’ organisation owned by the rugby clubs of Wales.  It might the biggest and most successful sports business in Wales, but it is owned by its members. 

Over recent years these members felt that the organisation’s values were wrong, and they set about changing the direction of travel.  They elected new people on to the management committee. 

They changed their strategy, they appointed a new chair to the board of directors that was more in tune with their values, and surprise, surprise, they are now looking for a new chief executive!

To many employees, this was demonstrative of the real power of the membership model and a professional board working in the values of a wider representative membership. 

We are currently consulting tenants and are now seeking support from our three important stakeholders the funders, the local authority and the Welsh Government.  We are planning a Special General Meeting in November followed by elections and appointments with a very appropriate go live day of the 1 May 2016.

Mike Owen, chief executive, Merthyr Valleys Homes