CLG refuses to sign off on Cosmopolitan inquiry

The Homes and Communities Agency regulation committee had hoped to secure the go-ahead to commission an independent review into what went wrong at the 14,000-home association and investigate the regulator’s effectiveness in its handling of the crisis.

However, the CLG has refused to sign off on the work, believed to cost more than £10,000, on the grounds it is too expensive.

The regulator is now believed to be looking at other ways of procuring the work, although it is not clear what this involves.

The CLG’s decision was criticised by Keith Exford, chief executive of 58,000-home Affinity Sutton, who said: ‘I would have thought it was eminently sensible to undertake a review of the unique circumstances that led to Cosmopolitan getting into trouble, so we can learn from what happened and to ensure the regulator is in the best place possible to respond if the same sort of thing were to happen again.’

A spokesperson for the HCA said: ‘We’ve said publicly that what happened at Cosmopolitan, and the regulator’s activities in response, will be the subject of an independent review.

‘This is important because of the serious nature of the failings at Cosmopolitan, and the need for the sector, including the regulator, to learn lessons from it.

‘We’re currently considering options as to what form the independent review should take.’

Liverpool-based Cosmopolitan ran into financial trouble as a result of loss-making leases taken out to fund its student housing business.

A spokesperson for the CLG said the department supports the proposal for a review. She said: ‘We are discussing with the regulator how to take the review forward in the most effective way.’

Cosmopolitan was eventually taken over in March by Sanctuary, which is understood to be carrying out its own separate review of the case.