Ashby flags 'unexplained' cost differences

The chair of the regulation committee at the Homes and Communities Agency (HCA) today revealed the first indications of findings from a ‘regression analysis’ project looking at landlords’ costs.

Mr Ashby, speaking at the Social Housing Finance Conference in London, said: “There are still huge variations in housing association costs and that’s part of what we are going to be using to provide additional challenge in the context of IDAs [in-depth assessments].” He also warned the sector still has a poor reputation on efficiency.

The HCA will look at value for money in all future IDAs of landlords, using the data from the HCA’s regression analysis. A regression analysis is a statistical tool that involves isolating factors that might influence costs – such as managing a large portfolio of supported housing – in order to attain a better picture of a landlord’s costs compared to the rest of the sector.

Following his speech, Mr Ashby explained that even when taking into account particular pressures on housing associations’ costs – such as social care – there were still large, unexplained variations in costs.

Mr Ashby also said the Value for Money (VFM) standard would be included in the HCA’s review of standards later this year. He added that there was scope for “deregulation” in certain consumer standards, but did not expand on which ones.

Mr Ashby added that the renewed appetite for mergers in the housing sector could mean that half of housing association stock could be owned by “a dozen” organisations in the future.

However, he warned that larger housing associations were not automatically more efficient than smaller ones.