May 13th 2019, 11:36
Blog 13th May 2019
In this week’s blog, I refer to: Housing; Local Government; Scotland; Regulator of Social Housing; Housing Associations; Rents; Ministry for Housing & Local Government; Welsh Government; Local Government Association; Children’s services; Peer Reviews; Spending Review; Fair Funding Review; Liz Truss MP; Seminars & Training.
We published the May 2019 edition of the ‘AWICS Scotland News’ last week. The 'AWICS Scotland News' provides news and analysis of many aspects of public policy including housing and local government in Scotland. It is freely available.
New Council Houses in North Lanarkshire
This month's edition includes articles on:
The Regulator of Social Housing launched a consultation last week on a revised Rent Standard for housing associations and local authorities that will come into effect from 1st April 2020. The consultation closes on 30th July.
The consultation follows the issuing of a Direction by the Ministry for Housing & Local Government to the Regulator to revise the rent standard as follows:
The draft rent standard covers: the 2020 limit, social rent, fair rent, affordable rent and moving between different types of rent. It includes ‘rent flexibilities’ with registered providers able to set rents at 10% above formula rent in supported housing and 5% above in general needs housing. Private registered providers may be exempted from the standard where the regulator feels that respecting the standard would jeopardise their financial viability.
Fiona MacGregor, Chief Executive of the Regulator of Social Housing said that:
“This consultation focuses on whether we have appropriately reflected the Government’s Direction to us. The Direction itself has previously been consulted on by Government. Our aim is to ensure that the setting and management of rents is clear and easy to understand for all registered providers of social housing.
“The long-term rent settlement should help provide a stable financial environment for the social housing sector to make the best possible use of its resources in supporting the delivery of new homes and effectively managing and maintaining properties, while protecting the interests of social housing tenants.”
Meanwhile, Julie James AM, the Welsh Minister for Housing & Local Government has announced that the Welsh government will issue the new rent settlement when responding to the Independent Review of Affordable Housing Supply before the end of July. This follows their surprise decision to restrict rent increases in 2019/20 to inflation only.
Bramble Court in Brampton, Cumbria. An Extra Care Elderly scheme developed by Impact Housing Association while I was Chair.
We are holding seminars on ‘All You Want to Know about Housing Association Finance’ in London and Leeds during July.
Housing Associations face significant financial challenges because of which it is now more important than ever that everyone involved in the governance, management and operations of housing associations has a working knowledge of housing association finance.
These seminars provide a solid grounding in the basics of housing association finance and are a useful introduction and overview of this important subject. They cover all aspects of Housing Association Finance including Income, Expenditure, Development, Capital Finance and technical financial issues.
In my work for the Local Government Association, providing financial briefing papers for peer review teams, I often find that Councils are having difficulty in resourcing effective children’s services within constrained budgets. There is significant service pressure around services for special educational needs.
I was therefore interested to read the speech made by Liz Truss MP, the Chief Secretary for the Treasury, as part of the Local Government Association’s debate on the spending review. She said that:
“We recognise that more funding is needed in special educational needs and children’s services, and I am looking at that in the spending review… Councils are spending more money on that, but I don’t want to see that squeezing the schools’ budget because we see that schools are under pressure… Those children with special educational needs are a real priority in the spending review.”
She also made some encouraging comments about devolution and local autonomy, even describing a local income tax as an ‘interesting idea’. She said that:
“I want to make sure that local government funding is sustainable. We are still a very centralised country. The next three years is going to be more of a transition about how we get there. But you need to be realistic about where we can get to in the next three years… Local authorities and local communities need to get more benefits of business success so if more houses are built and businesses started up, they need to see more of the proceeds.”
All this sounds very encouraging, but as I have noted in previous blogs, there is every likelihood that the planned three-year spending review will be downgraded to a single-year budget and that it may be more about further reductions in public expenditure than anything else.