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North East council to scrap ALMO after 18 years
A North East of England council has confirmed plans to close down its arm’s-length management organisation (ALMO) after 18 years.
South Tyneside Council’s cabinet signed off on the decision to bring its housing services back under direct control last week, after a tenant consultation.
All members of staff at the 16,500-home ALMO, South Tyneside Homes (STH), will transfer across to the council, the authority said.
It is the latest ALMO to be scrapped. A string of local authorities has been moving their services back under direct control amid funding and operational challenges.
STH, which is wholly owned by the council, reported a deficit of £7.7m in its last full year, as operating costs outweighed its turnover of £56.3m.
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Jim Foreman, the council’s lead member for housing and community safety, said the move would allow it to “identify areas for improvement and create a joined-up, streamlined housing service fit for the future”.
He added: “Bringing all housing services together also means we can make better use of resources.”
STH was launched in 2006 to access the Labour government’s Decent Homes Programme, which councils couldn’t access directly. However, that funding no longer exists.
The decision also comes as councils gear up to face inspections of their housing services under new Regulator of Social Housing (RSH) powers. It will be the first time local authorities have been inspected physically since the Audit Commission was abolished in 2010.
A report prepared for South Tyneside Council’s cabinet pointed out that the new standards “look beyond the bricks and mortar of the home and consider management of communal spaces, area management and anti-social behaviour”.
The report added: “To respond effectively to these specific expectations from RSH we must ensure that all services to tenants and leaseholders are aligned and integrated wherever possible.”
The ballot of tenants had an 11% response rate, with 94% of those responding being in favour of moving services back in-house.
On the plans for STH, the report said the ALMO will “need to be closed as a separate entity, including informing Companies House and the RSH, closing off final accounts and transferring any existing contracts”.
Other councils to have moved services back in-house in recent years include Manchester City Council, Newcastle City Council and Haringey Council in north London.
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