Independence...Integrity...Value

February 2014

Feb 9th 2014, 14:39

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24th February 2014

This week I will be in London for our seminar and workshop: ‘All You Want to Know about Local Authority Housing Finance 2014’. We are almost fully booked. I am looking forward to meeting the delegates and hope that everyone will find it a useful day. We will also be holding a session in the North in June and another in London in November. If you would like more details or to book a place please see: http://awics.co.uk/lahfin.asp

The book that accompanies the seminar and workshop: ‘All You Want to Know about Local Authority Housing Finance 2014’ is also available for purchase. This is my ‘best seller’. More details and an online ordering facility can be found at: http://awics.co.uk/local_authority_housing_finance.asp

I am also busy this week with Impact Housing Association where I am Chair. This morning I have been to Penrith to meet our Finance Director and Audit Chair to discuss our Treasury Management strategy. Despite the ‘credit crunch’ I am pleased to say that we are still able to receive good offers from the banks when it comes to loans – including loans of up to 25 years at fixed and variable rates. We have also been successful in renegotiating the terms of existing loans to increase our ‘gearing’ ratio enabling us to continue to borrow to fund much needed affordable housing.

Impact’s monthly board meeting will be held at Cockermouth on Thursday. The main items on the agenda are Treasury Management (hence today’s meeting) and the future of supported housing in Cumbria. Impact is a major provider of supported housing with schemes for the young, elderly. single men and women, domestic violence victims and others. We see providing these services as of critical importance to our mission to provide support for vulnerable individuals and communities that includes but goes well beyond the provision of housing.

The February edition of the ‘AWICS Housing News’ has now been published. It includes articles on:

  • Housing Associations continue to be financially stable
  • Severnside Housing Association and Performance
  • Irwin Mitchell takes Sandwell Council to Judicial Review
  • Oldham Council finds innovative ways to provide new homes
  • Scottish Local Authority Housing Income & Expenditure
  • Service Charges
  • National Housing Federation – Housing Finance Conference & Exhibition

Your copy can be freely downloaded from: http://awics.co.uk/dynamicdata/data/docs/awics%20housing%20news%20-%20february%202014.pdf

Previous copies of the newsletter can be downloaded from: http://awics.co.uk/HousingNews.asp

We have also published a new brochure about our interim management services that can be downloaded from our website at: http://awics.co.uk/dynamicdata/data/docs/awics%20interim%20management%20brochure.pdf

Have you ever wondered why local authorities and economic development agencies focus their attention on ‘Inward Investment’? As a student of economic geography in the 1980s I remember being told that many of the economic problems of developing countries arose because they were too dependent on ‘inward investment’ that led to any surpluses leaving the country and vulnerability to closures. We have seen this problem in the United Kingdom with ‘inward investors’ being induced by government into locating somewhere only to move on when the grants run out or when a better opportunity arises somewhere else. Whenever I hear that jobs have been secured because of ‘inward investment’ my pleasure is tempered by wishing that we had more local businesses that were able to invest. Perhaps local authorities and other agencies should shift their emphasis away from ‘inward investment’ to encouraging the foundation and growth of locally based business.

17th February 2014

Our next seminar and workshop is ‘All You Want to Know about Local Authority Housing Finance 2014’ that will be held in London on 26th February 2014. I am currently putting the finishing touches to my presentations. Thanks as always to those who are attending. The session is proving popular as always but at the time of writing there are still a few places available. We will also be holding a session in the North in June and another in London in November. If you would like more details or to book a place please see: http://awics.co.uk/lahfin.asp

Our latest briefing paper on ‘Scottish local Authority Housing Income and Expenditure’ is now online. This briefing paper summarises and comments on the Scottish Government’s latest ‘Local Authority Housing Income and Expenditure’ statistics. A copy can be freely downloaded from: http://awics.co.uk/sclahfinbp.asp

This week I will be interviewing people who have applied to be members of the board of Impact Housing Association where I am Chair. We were pleased to receive twelve very strong applications, from which we have short-listed six for interview. The interviews will be conducted by me, our Vice-Chair Ken Meek and our Chief Executive Mike Muir. I am very much looking forward to meeting the candidates. More information about the board of Impact Housing Association is contained on their website at: http://www.impacthousing.org.uk/board

My book ‘All You Want to Know about Service Charges in Social Housing’ is proving popular. We are making a good number of sales and are getting good feedback from customers. One customer from Somerset wrote to say:

“I recently purchased the above book which I have found extremely informative and helpful.”

It is possible to find more details about the book and to order a copy from our website at: http://awics.co.uk/bookschs.asp

Last week the Chartered Institute of Public Finance & Accountancy (CIPFA) Education & Training Centre (CETC) appointed me to their panel of authors. The CETC is the largest and most successful provider of courses for the CIPFA Professional Qualification. Their courses deliver examination pass rates that exceed CIPFA’s average pass rates sitting after sitting. Studying with them helps to prepare students for a successful career in public services financial management and beyond. CETC is part of the CIPFA group and has operated for over 25 years. It has locations throughout the United Kingdom where they deliver a wide range of high quality courses and support to students. My role will be to assist with the authoring of training materials. This role compliments my existing role as an examiner in management accounting for CIPFAs International Public Financial Management certificate. More information about CETC is available on their website at: http://www.cipfa.org/training-and-qualifications/cipfa-education-and-training-centre

10th February 2014

I have just put the February 2014 edition of the ‘Public Services News’ online. This month’s edition includes articles on:

  • Local Government Finance Settlement in England 2014/15
  • 2014/15 Budgets in Croydon, Brighton and Denbighshire
  • Autumn Statement and Local Government
  • Government plans £25billion in post-2015 cuts
  • Scots support increase in Council Tax
  • AWICS customers – Oldham, Croydon, Lambeth and Southwark - nominated in LGC innovation awards
  • CIPFA takes top honours at accountancy awards
  • Assessment of Company Profitability
  • Tullie House Museum and the Crosby Garrett Helmet
  • UNISON survey reveals debt problems caused by Christmas

Your copy can be freely downloaded from: http://awics.co.uk/PublicServicesNews.asp

I am rather interested by the different approaches to Council Tax in different places. Most authorities have opted for either minimal increases or a council tax freeze. However, Brighton & Hove City Council has caught the headlines with a proposal for a referendum on a 4.75% increase. Cumbria County Council consulted on a council tax freeze or a 2% increase, the majority of respondents favoured a 2% increase but in the event they went for a freeze! Meanwhile in Scotland, a majority of voters are found to favour increased Council Tax as a way of funding improved services. The government’s policies on freezing Council Tax and localising Council Tax Benefit are also having the interesting effect of meaning that in many areas it is only the poorest people (those entitled to Council Tax benefit) who are seeing significant increases in what they have to pay!

I see that local authority and housing association landlords are making significant increases in their rents in 2014, presumably prompted by the restrictions that the government is proposing to place on social rent increases from 2015 onwards. This is an interesting chain of events: the government proposes limiting rent increases from 2015 onwards to the consumer prices index plus 1% rather than the retail prices index plus 0.5% plus £2 a week saying that it wishes to protect tenants from significant real increases in rents; and the social landlords (understandably) respond by increasing their planned rent increases for 2014!

Last week I presented an in-house session of ‘All You Want to Know about Service Charges in Social Housing’ for St. Albans District Council. I have previously provided them with in-house training in local authority housing finance so it was good to go back again. Their housing service is very well managed and I was pleased to get feedback that included:

  • Good mix of time spent on discussion and exercises
  • The presentation maintained my interest throughout
  • Presented what could be dull and boring information in an engaging and informative manner

Our seminar and workshop on ‘Developments in Local Authority Housing Finance’ will be held in London on 8th July 2014. This popular seminar and workshop is designed to keep people up to date with developments in local authority housing finance. Details are now available on our website at http://awics.co.uk/devts.asp

3rd February 2014

This week I will be presenting an in-house session of ‘All You Want to Know about Service Charges in Social Housing’ at St. Albans District Council. I am looking forward to visiting St Albans again and to meeting the people there. Service charges seem to be a subject in which there is increasing interest within social housing.

It is interesting to see how the government is gradually eroding the benefits that local authorities have seen as a result of self-financing. First there was the ‘debt cap’ that prevents councils from using their own resources to improve their housing stock or build new homes; then there was the change to rent policy that leaves some local authorities with a ‘balck hole’ in their business plans; and now there are the proposals from the Homes & Communities Agency that housing associations and local authorities should sell their highest value stock

On the face of it, this appears like a sensible move. Sell a house in a high value area and generate a capital receipt that will pay for two in a low value area. However, as Ken Lee (Director of Resources at Wigan & Leigh Housing, Chair of the CIPFA Housing Panel and contributor to AWICS newsletters) points out in ‘Inside Housing’ this week, this move will make it more difficult for councils to manage their debt. He said that local authorities that took on debt in 2012 as part of self-financing agreements had calculated repayments based on projected rental income. Only a limited amount of capital generated from capital receipts can go towards repaying the debt under the deals. I wonder what the government’s next move will be?

The first AWICS seminar and workshop of 2014 will be the ever-popular ‘All You Want to Know about Local Authority Housing Finance’ that will be held in London on 26th February 2014. I am currently in the process of finalising my material to ensure that the session is fully up to date with new developments including experience with self-financing and welfare reform, the changing relationship between the general fund and housing revenue account, and the implications of the government’s new policies on setting social rents after 2015. For more information or to make a booking, please see http://awics.co.uk/lahfin.asp

It is interesting that the Homes & Communities Agency is now encouraging housing associations and local authorities to build more one-bedroom flats. One of the reasons why I have been sceptical about the ‘under-occupation penalty’ is that if the government was really serious about reducing under-occupation it would have been encouraging the development of one-bedroom flats for single people and childless couples to down-size into, and would be extending the policy to tenants who are retired. It now seems that they are attempting to do the first of these things but I would still be surprised if they did the second. It is also interesting that housing associations are reluctant to build one-bedroom flats as they see this as responding to short-term welfare policy rather than long-term housing need.

The latest book in our ‘All You Want to Know about…’ series. ‘All You Want to Know about Service Charges in Social Housing’ can now be ordered online. It runs to 93 pages and is a fully up to date overview of this important subject. Details are available on our website at: http://awics.co.uk/bookschs.asp

Our latest briefing paper on the ‘Assessment of Company Profitability’ is now online and can be freely downloaded from http://awics.co.uk/AssessofCompProf.asp

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