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Social housing sector ‘under scrutiny’, warns regulator
Social landlords face significant risks to their reputations, with the sector “under scrutiny” as it confronts tough choices on standards, safety, decarbonisation and housebuilding, the English regulator has warned.
Delivering a speech to the National Housing Summit yesterday, Fiona MacGregor, chief executive of the Regulator of Social Housing (RSH), noted that “the backdrop against which providers are working in is one of increasing pressures, heightened expectations and, in some areas, significant uncertainty”.
She added: “The sector is under scrutiny and the choices and decisions providers are and will be making speak to the culture of sector and individual organisations and will significantly impact reputation.”
But she said: “Social housing providers are emerging from the pandemic having demonstrated their ability to flex and really focus on the needs of tenants, to manage unforeseen challenges and in a position of comparative financial strength.”
Housing associations, for-profits and local authority landlords are coming up against “hard choices” about “whether to maintain standards, deliver safety improvements or for decarbonisation” as well as balancing investment in existing stock with new supply, Ms MacGregor said.
“If, or where, we see providers materially reducing forecast expenditure over the next five years, you can expect us to ask questions and seek an explanation of your approach,” she told delegates.
“In the current climate, the reputational risk for providers that are not maintaining their tenants’ homes to the required standards should not be underestimated.”
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Despite many providers already “delivering good customer service”, she said, “feedback suggests that there is real variability in the quality of services delivered to tenants”, with consumer regulation changes looming.
Emphasising the importance of using good data to support asset management decisions, Ms MacGregor said this “is an area that needs work in many organisations and is an area that providers can, and should, be getting on with”.
While acknowledging that the choices faced by social landlords “are not easy when there is uncertainty about the future requirements”, she stressed that “uncertainty cannot be a reason to ignore the issues”.
Elsewhere in her speech, Ms MacGregor warned against overreliance on income from new build market housing sales amid “longer-term macro-economic uncertainty”, as well as basing debt-heavy business plans on assumptions that low interest rates will continue.
She also issued a warning to the growing number of for-profit providers ahead of new requirements from the Social Housing White Paper, saying: “It is the landlord issuing the tenancy, not the managing agent, that needs to ensure that tenants have influence and engagement.”
Predicting an increase in mergers across the sector, she said consolidation can help providers “deliver more of their core social purpose” but, Ms MacGregor added, “it will be very important in the current circumstances to be able to demonstrate that a larger organisation does not have to be a remote one”.
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