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Notting Hill Genesis merger: former chair to vote against plans

The chair of the housing association that became Genesis is set to vote against its mega-merger plans at a crunch vote next week.

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Former chair of Paddington Churches to vote against Genesis/Notting Hill merger #ukhousing

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There will be a crunch vote on the Notting Hill/Genesis merger next week #ukhousing

Notting Hill and Genesis have been planning a merger which would create one of the largest housing associations in the country, with 64,000 homes across London and the South East.

But to pass the merger, which has been the subject of protests from some tenant groups, shareholders at both organisations must approve the plans by a two-thirds majority.


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Robin Sharp, former chair of Paddington Churches Housing Association which merged with other associations to become Genesis in 2011, wrote a letter to current Genesis chair Dipesh Shah earlier this month announcing his plans to vote against the merger.

In the letter, seen by Inside Housing, he outlined a number of concerns about the plans, some of which Genesis are understood to dispute. An extract is published below.

Linda Wade, a shareholder at Notting Hill and a Liberal Democrat councillor at Kensington and Chelsea Council, told Inside Housing she would also be voting ‘no’.

She said she was concerned about a move away from the organisations’ original purpose of providing low-cost housing.

There are 102 shareholders at Notting Hill and 55 at Genesis – a mixture of residents, founders, current and former board members and people with an interest in social housing. It is understood many are also planning to vote in favour of the merger.

Each group of shareholders must approve the plans by a two-thirds majority at a vote next Tuesday, with a confirmation vote to be held on 1 February.

A Genesis spokesperson said: “Mr Sharp is entitled to his views about the merger. Of course, we welcome his stated opinion [in the letter] that the merged organisation would be an improvement in key areas. Meanwhile, we are looking forward to next week’s vote of shareholders.

“We believe that a merged organisation will be able to raise customer service standards even higher, contribute better to tackling the housing crisis by delivering more affordable homes and have more influence with local, regional and national government.”

A spokesperson for Notting Hill said: “We believe that as a merged organisation we can achieve more than we can separately. We want to build more homes across London and the South East to provide more families with a place to call home.”

A redacted version of Mr Sharp’s letter is published below. Inside Housing has removed some allegations Genesis has demonstrated to be inaccurate.

Mr Sharp's letter

To get to the point straightaway I am disappointed to find that several of the positive statements and promises made on behalf of the board in the recent informal shareholders’ events, as well as in our one to one, are not reflected in the prospectus and rules now circulated. The fact that the documents
arrived on the last working day before the Christmas and New Year holidays and included the new rules (which had not been exposed during the informal events) has made scrutiny quite difficult for me in the time window I have had. Please excuse any misunderstandings due to this constraint.
The number of events for shareholders and the openness with which they were conducted came as a pleasant surprise in contrast to the secretive and corporatist approach of the last two decades, which had led Genesis to the brink of disaster. I had begun to think that with your arrival there was a change of tone and style, though I accept that the fundamental problem for housing associations with a clear social purpose is the Treasury’s refusal to inject adequate subsidy into new provision. Specifically my concerns are:

• No repeat of Kate Davies’ statement at the joint meeting that sales of valuable street properties in the two associations’ heartlands would be brought to an end;
• No reference to the intention of the merged association to remain connected to the community in its heartlands and unlike some other big associations to maintain the shareholder base – promises also made by Kate in her intervention;
• No assertion that the merged body will be able to borrow at interest rates significantly lower than those available to them separately;
• No real case made for being bigger, including no evidence for the promise to provide 400 more dwellings than would otherwise be the case – I believe there are figures available show that it is medium sized HAs that build more homes than the largest ones.
• No confirmation that there will be more expressly social housing, as compared with the incredibly low output of social housing last year: rolling affordable and social housing into one category of “general needs” provides huge wriggle room for this vital element of what the association essentially exists for;
• The trouble with the “resident promise” is that many promises of better service have been made before and if they are not delivered there is little that residents can do;
• By contrast there is no response to my suggestion of bringing back advisory area boards with resident participation as a way of raising the resident voice in governance without threat to the association’s financial integrity;
• Your promise of a mini-due diligence report as I requested has not been delivered and there are no due diligence reports at all for shareholders. I would be very worried if the two boards had reached
their decisions on the basis of the information given to shareholders;
• Provision 8.1 of the resolution/s makes the outcome subject to the necessary consent, approval or other required authority of funders, but we are told nothing about whether these consents have been
forthcoming or are likely to be forthcoming;
• It is not clear if there are resolutions (plural) to vote on or just one resolution on 16th January – having just one vote excludes the possibility that shareholders could approve the merger in principle but want changes to the new rules or other details.


For all these reasons I can’t support the plans as currently put forward, even if I believe that Genesis merged might be slightly better than Genesis on its own. I would like to see the two boards consider further what has emerged from the consultations and be much more transparent about the drivers for the proposals. I will be asking my proxy to vote accordingly.


With best wishes
Robin Sharp CB
Founder member and first chair of PCHA

Genesis is understood to have issued a rebuttal to Mr Sharp’s points to shareholders ahead of the vote, disputing the accuracy of some of his points, and issuing further explanation on others.

It is understood the merged organisation plans to only sell a minimal level of void properties which are no longer fit to be let. Genesis has also drafted a ‘resident promise’ which will ensure it is a “community-based organisation” with local staff and ‘locality plans’ developed by residents. It is using this process to develop a means of resident engagement, with resident input.

The housing association believes the merger will allow it to borrow more cheaply, with additional capacity to raise finance and better access to grant through the potential for ‘strategic partner’ status. Of the additional 400 homes it believes can be delivered as a result of the merger, Genesis expects 120 to be for low cost rent, and thinks it will build more specifically social rent homes than it would had it not merged.

Resident scrutiny panels have carried out reviews of services in recent years, resulting in changes to the management of repairs, service charges and complaints.

Detailed due diligence was provided to both boards ahead of their approval of the merger, and discussions are ongoing to receive consent from lenders. Shareholders will vote once on a resolution to merge, and will not be able to change the rules which are written to comply with requirements of both sets of shareholders, the Financial Conduct Authority and regulators and are based on a National Housing Federation template.

A spokesperson for Notting Hill Housing Group said: “We believe that as a merged organisation we can achieve more than we can separately. We want to build more homes across London and the South East to provide more families with a place to call home.”

Plans for the merger were first announced in July last year.

Additional reporting by Danielle Aumord

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