Regulator: Business Agenda for 2023 with Jonathan Walters, Sean Stafford and John Stevens

John StevensNov 27, 2023 11:00:00 AM3 min read

Past events and going forwards: The Regulator of Social Housing

“A safe and secure home is the bedrock of peoples’ lives, that is absolutely crucial, if you can’t do that you kind of lose your right to be a social landlord, that’s the core part of the job. We also need more and more new homes and Board Rooms have to get the balance right.”

Jonathan Walters – Deputy Chief Executive of The Regulator of Social Housing, with 20 years’ experience across the the Housing Corporation, the Tenant Services Authority and the Regulator, described his current viewpoint across 4 areas:

Economic
Political
Operational
Regulation

Also commenting on the ‘Tenant Satisfaction Measures’ (TSMs) to be introduced from April 2023.

Details, Questions and Answers:

Economic:

‘The Winds of Change’ have moved from a helpful “Tailwind” for the last 10 years, including low inflation, low interest rates, availability of labour and a positive housing market, to now a challenging “Headwind” on the same issues and we are in the midst of the storm.

The rent inflation ceiling of 7% for 2023/24 “is much better than might have been” (3,5,7% in consultation) but some cost inflations are higher than CPI.

The current issue is balancing new stock versus existing stock.

Political:

Recent tragic events have shifted focus 180 degrees for politicians from the quantity to the quality of housing stock, key issues being:

Damp and Mould
Building Safety
Zero Carbon

Politicians are asking why are Landlords not spending enough on homes?

Operational:

It is hard to adjust the development pipeline quickly.

Stock demands will hit development expenditure, margins and credit ratings, with less ability to absorb further shocks.

Tough decisions have to be made by the Board and Management Teams.

Regulation:

The RSH is going to be proactive across all areas of regulation:

Governance
Viability
Quality of Service (Measured by ‘Tenant Satisfaction Measures’ TSMs from April 2023)

Tenant Satisfaction Measures (TSMs):

Part of the RSH role is to be responsible for the consumer regulation of the sector, ensuring:

Tenants have quality homes
Well managed
Holding Landlords to account

Alongside revised consumer standards, the RSH are introducing 22No ‘Tenant Satisfaction Measures’ (TSM) from April 2023 for landlords with 1,000+ homes:

10 TSMs are measured by landlords
12 TSMs are covered by tenant perception surveys

The annual reporting of TSMs is proposed to:

Let tenants see how well their landlord is doing
Give an idea of which landlords might need to improve things

Summary:

The ‘Winds of Change’ and political focus have turned 180 degrees and the sector are facing politicians questions about stock condition, for tragic reasons, rather than the lack of overall housing numbers that have compounded issues over time. The sales inflationary mechanism and low cost inflation of the last 10 years have also turned to challenge traditional models of ‘cross-subsidy’ from sales, at the same time the operating environment is even harder with rising costs and shortages of supply and labour. Stock quality, tenant satisfaction and keeping up new supply are the challenges in the Board Room. Regeneration may have a raised political agenda with ‘Levelling Up’ and stock condition but it is difficult, expensive and takes skills that are in short supply. Government Regulation of all Providers in the sector will be by proactive review of Governance, Viability and Quality of Service including new ‘Tenant Satisfaction Measures’ (TSMs for Landlords with 1000+ homes) from April 2023.