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Do we really need to be more commercial?
Sector board members and executives are increasingly drawn from a narrow “commercial pool” and are becoming disconnected from their communities, warns Mike Owen
You hardly ever see an advert for a board member or a chief executive where the key skill requirement is not commercial experience.
How has the belief that the only people who know how to run any business are people who work in the private sector or people who have used public money and act as if they operate in the private sector?
“We have a love affair with the private sector that shows all the judgement of me as a teenager.”
So relentless has been the pressure on the public sector, so strong has been the narrative that public is bad and private is good, that we no longer even question the continued marketisation of housing organisations.
We have a love affair with the private sector that shows all the judgement of me as a teenager.
Going right back, who remembers going on Chartered Institute of Housing visits to British Gas to learn about customer care? Then there was a clamour to model our business and be like Virgin – or at least that was until we all went on their trains and used their broadband.
For a brief period it was Tesco and how they knew the shopping habits of every customer; shame they did not know how to put their profit and loss in the right year.
In more recent years we have had the comedy gold of “what if Apple or Uber ran housing?”. And now we are trying to learn from insurance companies and dot-coms about how we can use artificial intelligence to reduce costs.
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Have we reached the point when the board and the executives who run most housing organisations have all come from this narrow commercial pool that they have no relationship or empathy with, and are now totally disconnected from the communities they house?
I nearly used the term communities “they serve”, but the ethos of public service and accountability is almost extinguished in social housing.
“Accountability is battling with commercial decisions.”
However since the tragedy of Grenfell Tower we have all heard renewed calls for greater accountability and a stronger voice for tenants. But as a sector we are no nearer defining what this will look like, especially when accountability is battling with commercial decisions.
When political commentators outside of housing and housing association tenants are saying “give tenants a voice!” they are not thinking of housing patting itself on the back for tenants sitting on the interview panel for a new caretaker or some big data analysis telling us that people want smaller accommodation.
We all know by now how tenant participation works, we all know the multitude of models to get a tenant perspective into a decision, but what we have still to learn is how to share power.
We need to be talking about how to call the board and executive teams to account to balance the drive for commercialisation with a new drive for accountability.
This imbalance of power between housing organisations, their residents and local communities is magnified even more when regeneration and demolition are discussed.
A popular fringe event at the Labour Party conference last autumn was Paul Sng’s film Dispossession, a film that connected as it portrayed the powerlessness of communities when regeneration occurs. The mood of the conference was angry and it was seeking solutions.
We are now seeing the first signs of this change with the mayor of London proposing tenants’ ballots when demolition is planned. So if some local authorities have lost the trust of the mayor of London and Jeremy Corbyn on regeneration then the position for undemocratic housing associations looks even more problematic.
Many housing associations have long since lost their social purpose and have become increasingly unaccountable to anyone but their balance sheet.
Over the past few years we have seen the emergence of a new type of mutual housing associations that goes back to this original social purpose and in the case of Rochdale Boroughwide Housing and Merthyr Valleys Homes giving tenants and their employees’ real power.
“Many housing associations have long since lost their social purpose.”
At Merthyr Valleys Homes we have seen this shift in power as the tenants and employee members together elect a representative body who appoint (and can dismiss) the non-executive directors and the chief executive to run their housing on their behalf.
We have seen a changing dynamic with the board being both professional and highly skilled but also being truly accountable and answerable to tenant members.
Last year an Inside Housing survey of high-rise blocks found that less than 1% had sprinklers.
Over here in Wales it can be no coincidence that the only blocks of high-rise flats with sprinklers are in the two mutual housing associations – Bron Afon and Merthyr Valleys Homes – where tenants have real power.
If tenants in all the high-rise blocks of flats had real power and influence, would they really have made efficiencies at the expense of their own safety?
Housing needs to find a way not to just to finance new build housing, but to share power – and it needs to find it quickly.
Mike Owen, chief executive, Merthyr Valleys Homes
