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The governance lessons social landlords need to learn from the Consumer Regulation Review
The English housing regulator’s recent review of consumer regulation contains advice that housing providers need to pay heed to. Here’s a handy checklist to prevent you falling foul, writes Kelsey Walker
The Regulator of Social Housing (RSH) has just published its latest review of consumer regulation and there are some key messages for boards and councillors on how compliance with the consumer standards depends on good governance and organisational culture.
The 2018/19 annual review sets out the key themes arising from casework and some examples of cases considered against each of the four consumer standards, which are:
- Home – keep homes safe, decent and in a good state of repair
- Tenancy – let homes and manage tenancies in a fair, transparent and efficient way
- Neighbourhood and community – keep the wider area clean and safe, help tackle anti-social behaviour, and promote community well-being
- Tenant involvement and empowerment – understand and respond to the diverse needs of tenants, provide choice and opportunities for involvement, and resolve complaints fairly and promptly
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There were just six regulatory notices issued in the period covered by the review (from 502 referrals and 77 investigations). This reflects the RSH remit in that it can only investigate when there are reasonable grounds to suspect actual or potential serious detriment to tenants as a result of breaching the consumer standards.
All of these were for breaches to the Home Standard (fire safety featured in five out of the six), although other standards have been breached in previous years and others will be captured by the 2019/20 review.
There is real value in reading through the anonymised cases where consideration has been given to breaches against all standards as these show how the regulator considers evidence and balances judgements, and how these cases can still reflect on the regulator’s view of governance even when there isn’t a breach to the consumer standards.
There are strong links to governance in all of the cases. The point is made that compliance with the consumer regulations requires effective governance and risk management in place and that registered providers (RPs) should assess their own compliance to the consumer standards.
Our experience of supporting RPs to do this suggests this is not a one-size-fits-all review, and the level and depth of assurance needs to match the risk across each of the standards. The review states that robust reporting and assurance arrangements should be in place for effective oversight of compliance by boards and councillors.
“The point is made that compliance with the consumer regulations requires effective governance and risk management in place”
So, while keeping tenants safe in their homes is a constant theme, the review also points out how the handling of complaints effect the level of trust and confidence tenants have in landlords, and good analysis can enable early warning indicators to be acted upon.
In demonstrating compliance across all aspects of the consumer standards, RPs need to consider how they engage with their tenants, deal with neighbourhood issues and allocate properties.
Approaches to accountability and transparency in these areas goes to the heart of organisational culture and their social purpose.
It is important to understand the root causes of failing to comply with the standards, and the RSH encourages RPs to share their learning beyond their own organisation. Many of these root causes relate to:
- Weak data reconciliation
- Poorly designed or implemented systems and controls
- Inconsistent record keeping
- Gaps in assurance due to contractual and management arrangements
Self-referrals by RPs represent a significant proportion, 31%, of all referrals.
The regulator notes without comment, but with interest, that one in seven of referrals come at the time of an in-depth assessment notification – the point being made here is to note the obligation to report actively under co-regulation responsibilities.
I would also note that those self-reporting organisations that notified early and demonstrated a speedy and thorough approach to resolution remained compliant on governance, but others where there were longstanding known concerns dipped to G3.
If your governing body has not yet had the conversation about the circumstances in which it would report to the RSH, the discussion around this annual review would be a good time to do it.
Kelsey Walker, director, Savills Housing Consultancy
