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Scottish association told to merge following governance failures
A housing association has been told to find a merger partner, 18 months after the Scottish Housing Regulator intervened over serious governance failures.
The regulator has now told Wishaw & District Housing Association it will extend its intervention for a year while it seeks another landlord prepared to merge with it.
It appointed manager David Jepson to work with the association after it intervened in February 2017, who was later replaced by Sue Philpott.
Ms Philpott carried out a strategic review and “concluded that the option to merge with another RSL would provide the best opportunity for Wishaw & District to meet its strategic objectives”, according to the regulator.
It noted the governing body had recognised the serious issues and risks the association faced but “it has been unable to sufficiently strengthen and sustain its governance and leadership capacity in accordance with the regulatory standards [and] continues to rely heavily on the support of the statutory appointees to maintain effective governance”.
Wishaw & District will seek expressions of interest from landlords and Ms Philpott will stay for a further year to oversee this process.
The regulator will also increase the number of its appointees to the governing body from five to seven.
Wishaw & District’s problems stemmed from a site it bought for £1m in 2010 but “over the years it has failed to progress and agree with partners the development of the site”, the regulator said.
An options appraisal in 2016 revealed “serious risks” with the development and a subsequent investigation revealed “serious governance failures”, “significant weaknesses in risk management” and “serious financial risks” as a result of buying the site.
Wishaw & District owns and manages 1,021 homes and employs around 22 people. As of
March 2017 its turnover was around £4.95m and debt per unit was £10,772.
The association has been contacted for comment.
Update: at 12.55pm on 16.8.2017
This story originally reported that David Jepson had been appointed by the regulator as a statutory manager, carried out a strategic review and would remain for a year to oversee this process.
In fact, Mr Jepson was replaced by Sue Philpott in September 2017, who carried out the review and will continue to stay in role to oversee the merger. While this was not made in the regulatory judgement, we are happy to correct this mistake.
