On the 8th of June, Julian Ashby, chair of the Homes and Communities Agency regulation committee (HCA) wrote to 350 housing associations voicing his concerns about the sector’s procedure when it comes to efficiency.
According to the letter, the HCA plans to “reinforce” value for money regulation whilst taking a closer look at whether landlords are getting a good value for money in practice.
Ashby wrote: “‘It is concerning that there is such a wide variation in headline social housing costs. This level of unexplained variation must, at least in part, be due to differences in operating efficiency of different organisations.”
Tony Bryan, CEO of Vantage Business Solutions says,
“VFM and efficiency savings are back at the top of the HCA’s agenda and this did come as a surprise, especially following the government’s announcement of 1% rent reductions.
The current global accounts and HCA regression analysis does not explain the full picture of why costs vary so much. Housing providers need to strike the right balance between time spent on understanding why their costs are higher, and a focus on delivering actual sustainable efficiency savings as the clock is ticking.
The challenge is having the skills and resource to identify inefficiencies, understanding cost drivers and then doing something about it through a sustainable approach.”
According to Inside Housing, David Montague, chair of the G15 group of London housing associations, said the regulator’s strengthened approach to value for money could “only be a good thing for the sector.
They also went on to state that The National Housing Federation (NHF) published research showing ‘housing associations’ overhead costs have fallen from a median of 13.6% of turnover in 2008/09 to 11.8% in 2014/15.
If you would like to learn how Vantage Business Solution achieved sustainable savings of 24.5% pa in partnership with our housing association clients feel free to contact us on 0151 342 5989 or email Tony Bryan at tbryan@yourvantage.co.uk.