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Surpluses and minuses

London’s 15 largest housing associations are set to post surpluses of more than £1bn in their annual accounts - a new record.

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So here we are again.

London’s 15 largest housing associations are set to post surpluses of more than £1bn in their annual accounts - a new record.

L&Q’s surplus is £174m - another record breaker - while Peabody breaks the £100m barrier for the first time.

Indeed, the surpluses of these 15 power houses are not a million miles away from the overall surplus level recorded in the Tenant Services Authority’s global accounts for the entire sector in 2010/11.

Like the tally of goals conceded by the Brazilian football team this week or an induction evening at a WeightWatchers club, the figures just get bigger and bigger.

This is a news story that has inherent dangers for the sector. If associations are poor at communicating the reason for these surpluses - and let’s face it, in the past they haven’t all been great - then all sorts of problems lie ahead.

Senior housing figures will be well aware that salary and surplus figures prompt ministers and MPs to demand immediately that associations build more homes and improve their record on value for money.

A report last year by Savills and Affinity Sutton, Profting from Values?, contained a clear warning: if the sector becomes seen as ‘focusing on business objectives at the expense of its customers and communities’, there will be ‘implications’ for their independence, with increased regulatory attention likely to follow.

It added that associations should be ‘clear and unapologetic’ about reporting surpluses, but equally ‘clear and accountable about how they use these to invest in better homes and services in line with their values’.

Landlords don’t just need to be ready with answers when the inevitable questions arise - they need to be proactive from the outset.

They have to make it clear to tenants, ministers and other stakeholders precisely what the surpluses are for: helping to attract investment, develop homes and invest in communities, among other things.

Surpluses aren’t something associations should shy away from.

But if it turns into a stick to beat them with, they should be questioning their communication strategies.


READ MORE

Betts pushes to lead parliamentary inquiry into surplusesBetts pushes to lead parliamentary inquiry into surpluses
Betts pushes to lead parliamentary inquiry into surplusesBetts pushes to lead parliamentary inquiry into surpluses

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