First the good news: housing associations are making more money. Nobody in social housing talks about recording a profit, of course, because that is not what social landlords were put on earth to do. But the bald facts show that associations' total surplus in 2010 after tax was £609m - up £406m on the previous year. Even associations set up following the transfer of ex-council homes chipped in for the first time, reporting a modest surplus of £56m. Normally they record deficits.
There was some criticism in 2009, when the sector's overall surplus fell from £319m to £203m. Associations should be capable of better, said finance directors, especially as turnover was rising. Last year's more impressive result came in spite of the fact that sales of homes (either outright or part-sales through shared ownership schemes) have not recovered to pre-credit crunch levels.
The Tenant Services Authority's analysis of housing association accounts, published on the same day as the Budget, shows surpluses from the sales of 'fixed assets' down 40% on 2008. But the TSA praised associations for controlling management and repair costs better, while the sums paid in impairment charges where associations have to write down the value of land they own fell by £20m.
But why, you might say, is all of this important? Historically, associations have ploughed surpluses back into not just housing but into other activities that benefit communities, including health and training. With councils reeling from government cuts, associations might be the best bet we have to ensure community services are not completely decimated over the next few years.
Liverpool Mutual Homes, the largest housing association in the city, has set up a £700,000 social dividend fund that offers grants to community groups for social enterprises and other projects. It would be surprising if other associations did not do the same thing, so proving that social landlords were part of the 'big society' long before anyone at Conservative Central Office came up with the idea.
Whatever happens, there will be far more money flowing through associations' balance sheets in the years to come as they raise rents for new, and some existing, homes to as much as 80% of market rates. While they will be expected to use much of the extra proceeds to fund borrowing for further development, there is no reason why some money could not be set aside to fund community services.
With the future of associations' charitable status being questioned in some quarters, what better way to show that they have not lost touch with their local communities and vulnerable people in particular?
Wednesday, 30 March 2011
Thursday, 17 March 2011
Homelessness falls, or is it going up?
Every three months, the government reveals how many people in England are classed as homeless. Publication of the quarterly statistics is largely ignored by the media, which is generally only interested in how much houses cost rather than how many people can't afford to buy, or rent, one.
The latest figures, for the period to December 2010, make slightly confused reading. On one hand, the number of households living in temporary accommodation fell to 48,010 and is 10% lower than during the same period in 2009
At the same time, local authorities are dealing with more cases of homelessness and, in nearly half of them, accepting they must do something about it. Just over 26,000 households made applications to local authorities between October and December - 42% of which were accepted as priority cases where the council must provide assistance. The total number of applications was up 23% on the corresponding quarter in 2009.
The number of homelessness cases where local authorities are under a legal duty to provide assistance had been declining since 2003, before starting to rise early last year. The government says it has now stabilised at about 11,300 cases per quarter, but it is too early to say whether the number will rise again, or start falling.
All of which begs the question, has the credit crunch and recession resulted in more homelessness or not? Given that the economic crisis was largely caused by reckless bank lending for mortgages and had a major knock-on effect on housing, one might easily expect the situation to be worse than it is.
According to the government figures, most people become homeless because of breakdowns in family relationships, with just 3% of current cases caused by mortgage arrears. During the recession of the early 1990s, the number of cases involving households with mortgage problems peaked at 12%.
More worrying at present is what happens to people requiring temporary housing. Under Labour, the use of bed and breakfast accommodation for families with children fell dramatically. Yet during the final quarter of last year, 660 families with children were in B&B compared with 400 at the end of 2009.
While this is just 2% of the 36,230 families with children in all types of temporary accommodation, it is a worrying trend that needs to be reversed immediately to avoid the problem of homelessness becoming far more visible to society as a whole.
The latest figures, for the period to December 2010, make slightly confused reading. On one hand, the number of households living in temporary accommodation fell to 48,010 and is 10% lower than during the same period in 2009
At the same time, local authorities are dealing with more cases of homelessness and, in nearly half of them, accepting they must do something about it. Just over 26,000 households made applications to local authorities between October and December - 42% of which were accepted as priority cases where the council must provide assistance. The total number of applications was up 23% on the corresponding quarter in 2009.
The number of homelessness cases where local authorities are under a legal duty to provide assistance had been declining since 2003, before starting to rise early last year. The government says it has now stabilised at about 11,300 cases per quarter, but it is too early to say whether the number will rise again, or start falling.
All of which begs the question, has the credit crunch and recession resulted in more homelessness or not? Given that the economic crisis was largely caused by reckless bank lending for mortgages and had a major knock-on effect on housing, one might easily expect the situation to be worse than it is.
According to the government figures, most people become homeless because of breakdowns in family relationships, with just 3% of current cases caused by mortgage arrears. During the recession of the early 1990s, the number of cases involving households with mortgage problems peaked at 12%.
More worrying at present is what happens to people requiring temporary housing. Under Labour, the use of bed and breakfast accommodation for families with children fell dramatically. Yet during the final quarter of last year, 660 families with children were in B&B compared with 400 at the end of 2009.
While this is just 2% of the 36,230 families with children in all types of temporary accommodation, it is a worrying trend that needs to be reversed immediately to avoid the problem of homelessness becoming far more visible to society as a whole.
Thursday, 10 March 2011
Why housing has to keep the right company
These are difficult times for companies set up by local authorities to manage and, in theory, improve their council housing.
Arm's length management organisations (almos) first appeared on the scene nearly 10 years ago, primarily to attract government money for bringing homes up to the decent homes standard. An admirable aim and one for which Labour probably isn't given proper credit, the standard usually involved installing new kitchens and bathrooms in what were often rundown flats and houses.
Almos were the main alternative to councils transferring their homes to a housing association (which could then raise money for the work via private borrowing). However, they would not have been necessary in the first place if Labour had stubbornly refused to give money directly to local authority housing departments.
A decade or so later, many of the 60 councils with almos have started to question whether they are really necessary, especially where decent homes work is complete. A few councils have gone so far as to abolish their almos and take management work in-house again.
In the meantime, the coalition government has annoyed councils that went to the lengths of creating an almo by suggesting that, when it comes to claiming grants for outstanding decent homes work, an almo is no longer necessary. Last month, the Homes and Communities Agency gave £379m of the £1.6bn it was handing out in grants to non-almo authorities. At the same time, 11 councils with almos that bid for money received nothing.
But that does not mean almos have no future whatsoever. Next month, in East Kent, a so-called 'super-almo' will start managing 18,000 homes owned by four district councils, including Canterbury and Dover. All four have completed their decent homes work, and so the motive now is saving money, not raising grants from the government.
The 'super-almo' model appears to be in line with the government's policy of councils sharing services and so cutting overheads. East Kent Housing, as it was named by tenants, aims to save £2.5m during the next three to five years.
Whether it will be first and last of its kind remains to be seen, but those that have waved the almo banner so enthusiastically since 2002 will be hoping that it represents a way of making sure they are still around for a few years yet.
Arm's length management organisations (almos) first appeared on the scene nearly 10 years ago, primarily to attract government money for bringing homes up to the decent homes standard. An admirable aim and one for which Labour probably isn't given proper credit, the standard usually involved installing new kitchens and bathrooms in what were often rundown flats and houses.
Almos were the main alternative to councils transferring their homes to a housing association (which could then raise money for the work via private borrowing). However, they would not have been necessary in the first place if Labour had stubbornly refused to give money directly to local authority housing departments.
A decade or so later, many of the 60 councils with almos have started to question whether they are really necessary, especially where decent homes work is complete. A few councils have gone so far as to abolish their almos and take management work in-house again.
In the meantime, the coalition government has annoyed councils that went to the lengths of creating an almo by suggesting that, when it comes to claiming grants for outstanding decent homes work, an almo is no longer necessary. Last month, the Homes and Communities Agency gave £379m of the £1.6bn it was handing out in grants to non-almo authorities. At the same time, 11 councils with almos that bid for money received nothing.
But that does not mean almos have no future whatsoever. Next month, in East Kent, a so-called 'super-almo' will start managing 18,000 homes owned by four district councils, including Canterbury and Dover. All four have completed their decent homes work, and so the motive now is saving money, not raising grants from the government.
The 'super-almo' model appears to be in line with the government's policy of councils sharing services and so cutting overheads. East Kent Housing, as it was named by tenants, aims to save £2.5m during the next three to five years.
Whether it will be first and last of its kind remains to be seen, but those that have waved the almo banner so enthusiastically since 2002 will be hoping that it represents a way of making sure they are still around for a few years yet.
Wednesday, 2 March 2011
A listening government?
Whisper it quietly but, just occasionally, the coalition government listens to criticism over housing. Last month, it backed down over plans that would have meant people claiming job seeker's allowance saw 10% of their housing benefit deducted it they did not find a job within a year.
Now it looks as if plans to radically change the terms under which families rent social housing are being quietly revised. Last year, you may recall, there was a huge fuss when David Cameron questioned whether, in future, council tenants should automatically get a home for life.
By the time proposals were published a few months later, social landlords were given the option of letting homes to new tenants for as little as two years, but there was no requirement. This week it was revealed that most councils and housing associations have no intention of offering such short tenancies.
As a result, the government now says that, while two-year tenancies remain an option, it expects tenancies will be for longer in most cases, especially where households include children or vulnerable people. Common sense, you might say?
Well, organisations such as the Chartered Institute of Housing are continuing to lobby for a minimum fixed term of five years. Others will say that is too short. The point is that, so long as it is left to the discretion of social landlords, it seems unlikely that any changes will be as Draconian as first seemed.
Some would argue that a council home should always be for life. But the fact is that social landlords offer a range of accommodation and will increasingly do so, especially if it becomes the norm to let newly-built properties at 80% of market rents.
In many cases, mobility has to be encouraged. Getting the balance right is going to be tricky, but at least the government appears to be leaving decisions to those that, in the main, understand and respect the needs of families on the housing waiting list.
Now it looks as if plans to radically change the terms under which families rent social housing are being quietly revised. Last year, you may recall, there was a huge fuss when David Cameron questioned whether, in future, council tenants should automatically get a home for life.
By the time proposals were published a few months later, social landlords were given the option of letting homes to new tenants for as little as two years, but there was no requirement. This week it was revealed that most councils and housing associations have no intention of offering such short tenancies.
As a result, the government now says that, while two-year tenancies remain an option, it expects tenancies will be for longer in most cases, especially where households include children or vulnerable people. Common sense, you might say?
Well, organisations such as the Chartered Institute of Housing are continuing to lobby for a minimum fixed term of five years. Others will say that is too short. The point is that, so long as it is left to the discretion of social landlords, it seems unlikely that any changes will be as Draconian as first seemed.
Some would argue that a council home should always be for life. But the fact is that social landlords offer a range of accommodation and will increasingly do so, especially if it becomes the norm to let newly-built properties at 80% of market rents.
In many cases, mobility has to be encouraged. Getting the balance right is going to be tricky, but at least the government appears to be leaving decisions to those that, in the main, understand and respect the needs of families on the housing waiting list.
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