Housing Corporation News Release

Corporation proposes to improve its fourth traffic  light

16 March 2007            Ref: 28/07

Housing Corporation proposals to change  its fourth performance traffic light approach are set out in a consultation paper on revisions to its regulatory assessment process launched today (Friday 16 March 2007).
 
Under the current system housing associations are assessed on three key areas: viability; governance and management, as well as the performance of associations in their use of Social Housing Grant.

These proposals aim to modernise the Development section of the HCA, turning it into a more holistic assessment of an association’s investment performance. This reflects changes in the strategic environment that associations are operating within, and recognises that stakeholders, in considering how housing associations choose to use their resources, are not interested solely in the use that associations make of Housing Corporation funding.

Rather, it is an attempt to join up the information we have about asset management strategies and  investment plans so that we can recognise the value of the diverse contributions that so many associations make to the neighbourhoods in which they work; and which a narrow focus on Social Housing Grant precludes.

In proposing these changes the aim is not to interfere with the discretion of housing association boards to determine how available resources are used, but to ensure assets and capacity are used efficiently.

Housing Corporation Director of Regulation, Clare Miller said, "We want to work with associations, and other partner organisations, to meet the challenges of creating and maintaining sustainable neighbourhoods, and to deliver a step change in housing supply.  We look to associations to increasingly align their asset management and financial strategies to work towards these objectives.

"These proposals do not represent an increase in regulation or administrative burden. It is our intention to use information we already have from associations about their investment strategies and financial plans. We are not seeking to constrain associations but rather to enable and encourage innovation. I welcome comments on the general approach set out in the consultation paper, as well as on the specific proposals."

The consultation is now available.

Written comments and responses should be sent to:
Mick Warner
Head of Financial Regulation
Housing Corporation
4th Floor
One Piccadilly Gardens
Manchester M1 1RG
Email: mick.warner@housingcorp.gsx.gov.uk

The closing dates for comments is Friday 8 June 2007.

Media contact: Sandra White Tel: 0207 393 2094

Ends.
 
 Note to editors:

• HCAs were introduced in 2002 alongside the publication of the Regulatory Code.  Since then the basic format of the HCA has changed very little, continuing to focus on the three elements of the Regulatory Code - viability, governance and management - as well as the performance of associations in terms of their use of Social Housing Grant.

• The Housing Corporation is the Government agency responsible for investing in new affordable homes and regulating over 1,500 housing associations across England.  Its biggest ever investment programme of £3.9 billion for 2006-08 will fund 84,000 homes; 49,000 of these will be for affordable rent, and 35,000 will be for affordable sale through the Government's new HomeBuy initiative, helping people to get a foot on the property ladder.