The Social Housing Regulator

Business as usual -

All change

A short history of the TSA

• Cave Review – “Every Tenant Matters” – in 2007• Emphasis on protecting consumers who

have little choice over landlord or accommodation

• Cross domain regulation – same regulation for all types of providers (housing associations, local authorities, and new for-profits)

• Co-regulation with graduated investigation and intervention powers

• TSA established in December 2008• Introduced new regulatory framework• Principles of co-regulation• Outcome oriented standards framework

• The new government has expressed different views on the role of the regulator and a review was undertaken

The Review of Social Housing Regulation

• Emphasised the importance of economic regulation

• Maintaining lender and investor confidence, and protecting taxpayers remains vital

• Consumer regulation largely moves from the Regulator in favour of local solutions

• The role of consumer regulation will focus on setting clear service standards for social landlords

• Our economic and consumer regulation functions to be transferred to a statutory regulation committee within the HCA

• This committee will exercise statutory regulation functions independently within HCA

• The change from TSA to a social housing regulator within HCA is proposed in the Localism Bill

• The Bill is now at Report Stage in the House of Commons

• The Localism Bill includes provisions for: o Establishing the Regulation Committee in the HCA

o Transfer of regulatory functions to the HCA Regulation Committee

o Reforms to allocations policy - greater powers for local authorities to decide

o Greater flexibility of tenancies - shorter, fixed term tenancies, from two years in length

o Powers of the HCA in London transferred to the Mayor and GLA

Social Housing Regulation to become part of the HCA

The Regulation Committee

• Independence

• TSA functions are transferred to the Regulation Committee

• Decides its own procedure

• Membership

• Up to 7 members including the Chair• HCA Board may appoint one member

• Objectives defined in statute

As the social housing regulator

We have five strategic priorities to April 2012, when the new arrangements should come into effect:

• Ensure we realign our regulatory policies to implement the Government’s new approach to social housing regulation

• Ensure our continued economic regulation is effective and maintains the confidence of lenders

• Ensure we deliver change and cost savings in a way that is fair to staff and ensures the regulatory functions are properly resourced within the context of a future fee regime

• Ensure we continue to work with key stakeholders in a co-regulatory way

• Ensure we work collaboratively with HCA, GLA and DCLG on the transition programme

Social housing regulation to April 2012

• The TSA is responsible for regulation until

legislation transfers the function to the HCA’s Regulation Committee

• Maintaining the integrity and effectiveness of regulatory operations remains central to the regulator’s activities

• The published regulatory framework and providers’ obligations has not changed and continues to apply until it is changed

• Legal form of the regulator does not change providers’ regulatory obligations

Economic regulation

• We have a clear track record of strong economic regulation and despite a challenging environment, this will continue

• Delivering new homes: there are new challenges for how we support the delivery of new homes

• We will work with the sector to develop a greater focus on how providers deliver value for money for the taxpayer

• We will continue to review financial information from providers and publish our quarterly analysis of the sector and engage with the people that we regulate

• We will continue to be an intelligent regulator taking account of the wider economic environment in which providers operate

The new role of the social housing regulator in consumer regulation• Old regime

• Local Offers • New regime

• Local Offers, plus• Democratic filter• Enhanced role of the Ombudsman• Regulator will only intervene in cases of

‘serious detriment’ – the new test• Tenant panels

Consumer regulation

• It will be for boards to decide how best they meet the new localism agenda but they will need to consider how they engage positively with and resource effective partnerships with local government and their tenants

• Providers will continue to work with tenants to ensure co-regulation continues to flourish in local communities

• There was near-universal support from providers in submitting Annual Reports for tenants

• Good examples of co-regulation and local co-operation between providers, tenants and other agencies

• Local Offers in place by April 2011

Introduction of fee charging• We are undertaking work to prepare for the introduction of

fee charging, as per our powers in Housing and Regeneration Act 2008

• The earliest introduction date is April 2012, but we can't be more definite as it is subject to a number of external factors that are not in the regulator's control

• We are considering a range of options for how that fee regime may look and the amount of fee income to be recovered

• Fee regime will be built around a set of objectives including fairness

• The fee regime will include an element of transparency about the activities being carried out by the regulator so providers should be able to understand what they are getting for their fee

• We will ensure that the sector is involved in the development of a fee regime and will engage in consultation prior to implementation

• We are aware of the budget planning processes of providers and will ensure that timely information is provided in order to allow budget planning for potential fee payers

Difficult times, resilient sector

• Latest figures from the quarterly survey demonstrate that the social housing sector remains resilient in an uncertain economic environment

• The sector has remained attractive to funders as evidenced by £2.3 billion of new facilities arranged in the 9 months to 31 December 2010

• The number of unsold low-cost home ownership (LCHO) homes continued to decrease, falling a further 7% to 3,817

Difficult times, resilient sector

• The Global Accounts 2009/10 show some significant landmarks for the sector:

- Housing Association assets reached £100bn for the first time - An increase of over 100,000 units in

management- Rental income from social housing over £10bn- Global interest cover in excess of 100%- The stock transfer sub-sector moving into overall surplus - Sector borrowing increased by £2.8bn during the year, and grant from the HCA increased by £3.1bn

Affordable rent programme – TSA role

• TSA will review proposals to ensure viability is maintained and they are capable of delivery

• Early liaison and consultation with Local Authority partners is key to successful delivery

• The framework document was launched by the Minister on 14 February 2011

Affordable rent

• Core product for the HCA’s 2011-15 Affordable Homes Programme

• RPs entering into delivery agreements allowed flexibilities to manage existing stock to support new supply e.g. converting a proportion of vacant social rent units to AR

• TSA has consulted on changes to the Tenancy Standard

Affordable rent

• HCA timetable for the programme:

o 3 May 2011 – Deadline for submission of offers

o May and June 2011 – Assessment/negotiation of offers

o 20 June – 4 July 2011 – National aggregation and analysis of programme

o 4 July – HCA London Board, Ministerial and national HCA Board sign off of aggregate programme (subject to provider contracts)

o July 2011 – Initial contracts signed

Working with stakeholders

• Our approach to co-regulation supports the Government’s localist agenda and we will bring forward proposals for reform of regulatory policies that enhance and reinforce co-regulation

• We will consult with stakeholders in how best to develop regulatory policies that will meet the needs of all of our key stakeholders

• We will explain how, when and why we are proposing to change the regulatory framework, how we have taken account of all of our stakeholders’ views and the reasons for our decisions

Working with stakeholders

• We are working with DCLG to implement the proposed reforms in the Localism Bill and with stakeholders to ensure that regulatory policies deliver the required objectives

• We will set out a clear timetable for the changes we propose to make and will do this ahead of the transfer of regulatory functions to HCA

• We are committed to collaborative working to establish what the ‘serious detriment’ test looks like

Conclusions and actions

• The new framework is one year old and its strengths are widely recognised

• Co-regulation is about boards being the primary point of accountability – this is established in the current framework and will continue in the new framework

• Regulatory requirements continue and we will continue to operate the system to maintain confidence in the sector and statute commits to continuing independent regulation for this reason

• Our commitment is to openness and transparency in how we will consult on changes to the framework

• We will develop a greater focus on VFM to take forward the conclusions of the review of social housing

Tenant Services Authoritywww.tenantservicesauthority.org0845 230 7000

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