Luminus non-compliant over governance and gas safety failures

Luminus was downgraded to a non-compliant G3 for governance today after a damning judgement from the Homes and Communities Agency (HCA) found serious weakness in its governance.

The provider was also found in breach of the ‘Home Standard’ after putting its tenants at risk of “serious detriment” through its failure to keep up-to-date gas safety checks.

In a statement responding to the judgement, Luminus said it intends to “make this a year of new beginnings for the benefit of all”.

Following an in-depth assessment (IDA), the HCA said it lacks assurance that the board of the Huntingdonshire-based organisation “is maintaining effective control over Luminus and its activities”.

It plans to build 100 units per year, and has recently launched an outright sale programme in London and Cambridge, including a £48m investment in an external property development company.

But the HCA found “material weaknesses” in the information provided to the board about the risk of these ventures which “have not been effectively challenged”.

“The board does not receive sufficiently detailed information to allow it to effectively monitor and make decisions on the investment, and has not effectively challenged that situation,” it said. “The regulator has concluded that board members of Luminus are not discharging their duties with adequate skill.”

During an internal audit last June, Luminus also found 25% of a small sample of properties did not have valid gas safety certificates.

Following a further assessment, it was identified that more than 1,000 properties had not had a valid gas safety certificate for at least some part of the previous two years.

The board did not inform the regulator and “did not seek to understand the root causes of the failure”, the HCA said. It said Luminus is adopting new policies as a result.

In a statement, Mike Forrest, newly appointed chair of Luminus, said the gas safety failings were “unacceptable to us as a company that is known to have genuine care and concern for our residents’ well-being”.

He added: “The board, in acknowledging the judgement will, as part of its reflective process, consider diligently the evidence adduced by the HCA from the IDA, when this is provided.

“We are here to serve our communities, and the board, executive and all the staff team intend to press forward and make this a year of new beginnings for the benefit of all.”