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Scottish housing association ‘faced insolvency’, regulator reveals

A Scottish housing association “faced insolvency” before the regulator intervened, a report has revealed.

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A Scottish housing association “faced insolvency” before the regulator intervened, a report has revealed #ukhousing

The Scottish Housing Regulator (SHR) has released new information about its work at Antonine Housing Association, a 338-home association that was subject to extensive intervention over a number of years.

It revealed that Antonine was unable to pay back outstanding loans and so was at risk of insolvency. The association also did not comply with Scottish standards for housing quality and energy efficiency.

SHR reported it was first contacted about Antonine in late 2015, when a third party made “allegations of improper conduct and mismanagement”.


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In February 2016, it visited Antonine to investigate the capabilities of its governing body and found that the association could not demonstrate that its governing body had been properly constituted.

The governing body then commissioned three independent investigations into the allegations and into Antonine’s wider governance.

SHR said that an independent investigation found in August that year that Antonine’s governing body had only two legitimate members. The regulator intervened the following month for the first time. It intervened again the following year over a breached loan covenant.

This was all SHR announced at the time, but its report has now revealed that in September 2016, Antonine’s sole lender required it to repay its loan by the end of the calendar year – something Antonine could not afford to do.

The regulator said that as a result, Antonine “faced insolvency”.

According to the report, Antonine’s problems also included:

  • No up-to-date business plan
  • Failure to comply with legislation
  • Inaccurate regulatory returns
  • Governing body members didn’t fully understand their roles
  • No effective assessment of governing body members
  • Little active management of its relationship with its lender
  • Poor understanding of risk, including financial risk
  • Poor quality of information about the condition of its homes
  • Failure to review and apply policies
  • Weakness in procurement practice and little evidence of value for money
  • Failure to pursue grant funding and other government support
  • Ineffective relationships between staff and governing body

SHR said: “Working closely with Antonine’s lenders, the statutory manager, within extremely tight timescales, secured a short extension to the repayment schedule and then alternative funding.

“This averted insolvency, which would have had ramifications for Antonine and, potentially, the wider [registered social landlord] sector.”

As part of its rescue plan, the much larger Caledonia Housing Association acquired Antonine in October 2018. SHR’s report said that Caledonia offered Antonine’s tenants a rent guarantee, £1.45m of investment in their homes over five years, a £20,000 neighbourhood fund and a tenant committee to make decisions.

The regulator said that Antonine has improved considerably since intervention and tenants have benefited.

Caledonia has been contacted for comment.

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