Regulator should avoid using numerical development targets or comparing landlords’ delivery under new regime, says NHF and G15

The Regulator of Social Housing (RSH) should avoid making direct comparisons of landlords’ delivery or development capacity under its forthcoming shake-up of economic regulation, sector bodies have warned.

The RSH in June published a wide-ranging discussion paper called More and Better Social Homes which outlined dozens of new ideas for regulating the sector. Among them was a proposal asking RPs to publish an appraisal of their development capacity and, where they can develop, to set themselves a target for new homes built.

In its response to the RSH’s call for evidence, the National Housing Federation said: “Boards should assess their capacity to deliver more and better homes, taking account of local need, investment in existing homes, funding, expertise and risk appetite.

“The regulator should seek assurance that this process is taking place, while avoiding the use of numerical development targets or direct comparisons between landlords. “

NHF warned that greater interventionism from the regulator to scrutinise landlords’ plans and performance would disempower boards and divert money and time away from providers’ core activities.

The G15 group of large housing associations in London said responsibility for deciding how capacity is deployed should remain with boards, informed by residents’ priorities and responsibilities to residents.

It added: “RSH should not seek to establish a separate regulatory view of a provider’s theoretical maximum development capacity. This would blur accountability between boards and the regulator by moving beyond regulatory assurance into decisions about how much development a provider ought to undertake.

“Publication of comparable capacity figures could add to that risk by allowing those figures to become de facto delivery targets, irrespective of changes in scheme, market or investment conditions.”

In its response, the Chartered Institute of Housing said smaller and community-based landlords have raised concerns about the RSH’s language on using development capacity and increasing efficiency.

It said: “Community-based organisations may have different priorities to those of larger landlords, as they must focus on, and act upon, the priorities of residents, which may require a greater focus on investment in existing homes and neighbourhoods rather than building new homes, for example.

“Flexibility and an understanding of the diversity of the sector is needed to reflect that organisations know their residents best and should make decisions to meet their needs, within the existing regulatory framework.”

As reported by Housing Today last week, the Northern Housing Consortium has called on RSH to acknowledge how locally-led regeneration can improve the quality and quantity of social housing stock.

Jonathan Walters, chief executive of RSH, last month told the Housing Community Summit in Liverpool that the proposals to make providers accountable for delivery were “about accountability, not control”.

He said “We’re not interested in entering the boardroom and controlling what you do. That is your job.” He stressed however that “not building new homes is not an option.”

The RSH call for evidence closed last Wednesday. Detailed proposals will now be drawn up for a formal consultation.