CLG consultation on the Housing and Regeneration Act 2008 (Registration of Local Authorities) Order 2009

General

CIPFA welcomes, through the Cross Domain Order, proposals to allow the Tenant Services Authority to register and therefore regulate Local Authority providers of social housing.

In CIPFA’s view, this will give greater consistency to service delivery for social housing tenants and contribute to raising standards.

CIPFA has some concerns, however, that the proposals should not increase the administrative and reporting burden on Local Authorities. To this end, the TSA and other organisations which regulate Local Authorities will need to work effectively together. There are many areas of overlap in inspection, regulation and powers to deal with poor performance and failing organisations, between the audit commission, the government and the TSA. The detailed mechanisms need to clarify how these operate to the benefit of tenants and residents.

The current consultation paper on “The Reform of Council Housing Finance” will have an impact on the regulation of both ALMOs and local authorities with retained stock. The proposals around the TSA will therefore need to accommodate the changes proposed in the consultation paper Reforming Housing Finance in the event that the latter are adopted.

Turning to the detailed issues and specific questions posed in the consultation, CIPFA’s views are as follows:

Question 1:  Do you consider that the Cross Domain Order would provide a framework to allow:

• The Tenant Services Authority to regulate local authority landlords in an effective and proportionate way?

• The Tenant Services Authority to regulate in a manner which ensures that it can achieve its fundamental objectives?

The regulation by the TSA of all social housing providers should enable it to achieve its fundamental objectives and deliver on the Cave review. The framework will need to be flexible to accommodate changes as a result of the proposals in “The Reform of Council Housing Finance” which is currently out to consultation.

Question 2: Do you agree that all local authorities who currently retain ownership of social housing stock (regardless of management arrangements) should be subject to registration with the Tenant Services Authority?

This would mean that organisations such as ALMOs who manage rather than own social housing stock would not be registered with the regulator directly.
CIPFA welcomes the fact that local authorities will not need to individually register but be automatically registered on April 2010.

Question 3: Do you agree that all social housing stock owned outright or acquired on a long-lease by a local authority should be subject to regulation by the TSA?

CIPFA agrees that all social housing stock owned outright or acquired on a long-lease by a local authority should be subject to regulation by the TSA. Fees will need to represent value for money to those who register.

Question 4: We propose that information burdens arising from new regulatory framework should be minimised through making best use of information already in the system (information already produced by local authorities for public reporting and internal management purposes). Do you agree that this approach will enable the TSA to gain a good understanding of performance without adding burdens to local authorities? 

CIPFA welcomes the suggestion that the information burdens should be kept to minimum using existing published information. This however may have practical difficulties due to the local nature of much of the reporting. The detail and nature of most performance reporting is determined by local organisations based on tenants and local authority views, there may therefore be little consistency. Many organisations however operate a performance management framework containing much of which will be common between them. This may be a more fruitful source of information.

The approach could go further by undertaking that any additional standard information requirements would be offset by a corresponding reduction in information requirements elsewhere

Question 5: We propose that the TSA would have the same power to set standards for local authorities on matters of housing management as for housing associations. Any nationally applied performance indicators would need to be set by Government and included in the National Indicator Set when next refreshed. Do you agree that this approach would provide the TSA with the necessary powers to set standards across all providers of social housing?

CIPFA supports the general aim of improving clarity and transparency for tents by requiring all social landlords to provide services to the same standards regardless of the nature of the organisation structure. However caution needs to be exercised in setting standards across all providers of social housing because standards will need to take into account the total resources available – and there does not currently exist a level playing field with regard to resources across social housing providers.

Again, the proposed changes with regard to self financing may indicate a need to review information needs.

Question 6: Do you agree that the proposed regulatory and intervention powers will be sufficient to enable the TSA to promote high standards for tenants?

In CIPFA’s view, the regulatory and intervention standards proposed should be sufficient to promote high standards. 

Question 7:  Do you agree with our proposals to pass the power to grant consent from the Secretary of State to the TSA in situations where local authorities wish to enter into a management agreement with another body to take over management of all or part of its housing stock?

We agree that the granting of consent for agreements to delegate housing management functions for the local authority to another body should be with the TSA not as currently the Secretary of State.

These proposals should not however lead to costs to local authorities being greater than existing audit regulation fees.

Question 8: Do you think that the impact assessment broadly captures the types and levels of costs associated with the policy options?

The evaluation has been undertaken on the basis that the Audit Commission will have the primary responsibility of assessing financial viability in local authorities. Should the reform proposals for Housing Finance Reform be adopted, then potentially the TSA may have a more active role in regulating the financial viability of the HRA. There would then be consequential costs to this increased role.

We welcome the consultation with local authorities of this and the potential costs of cross domain regulation to them.

Question 9: Do you think that the impact assessment broadly captures the types and levels of benefits associated with the policy options?

No further comment other than see under response to Question 7.

Question 10: Do you agree that the impact assessment reflects the main impacts that particular sectors and groups are likely to experience as a result of the policy options?

No further comment other than see under response to Question 7.