The Ministry of Housing, Communities and Local Government has published the Social Housing White Paper (aka “The Charter for Social Housing Residents”) today, 17 November 2020. A full copy of the White Paper is available here.

The good news is that the 75-page document contains few surprises and, as expected, the focus is on health & safety and tenant empowerment. The government will be working with the Regulator for Social Housing (RSH) to create a strong, proactive consumer regulatory regime, strengthening the formal standards against which landlords are regulated and requiring them to:

• be transparent about their performance and decision-making – so that tenants and the regulator can hold them to account;
• put things right when they go wrong; and
• listen to tenants through effective engagement.

In case you haven’t yet had time to review the full document, our experts have pulled together some of the key points for you. This insight is intended as a high-level summary; for those with a bit more time, we will be publishing a more detailed commentary on the White Paper, with a particular focus on tenant engagement, to read with your morning coffee tomorrow.

Safety

As expected, health and safety is at the core of the White Paper. Three years and five months after the tragic events at Grenfell Tower, the following measures have been announced:

1. The RSH’s objectives will be updated to include explicit reference to safety and transparency. The RSH will overhaul its consumer standards to meet modern requirements.
2. Each registered provider (RP) must have a nominated person responsible for safety.  This may well be the same individual who will be accountable for higher-risk buildings under the Building Safety Bill. 
3. The RSH will liaise more closely with the Health & Safety Executive, once the Building Safety Regulator is created, to ensure appropriate sharing of information.
4. Formal consultations on further safety measures will follow, e.g. smoke/carbon monoxide alarms and electrical safety.

Most RPs are already compliant with expected health and safety changes, and are costing this up in their business cases. You may also have identified a senior executive able to take on the primary responsibility for health and safety within your organisation.  This is a rapidly changing area and so keeping on top of, and responding quickly to, developments will be essential in the coming months.

Accountability of RPs

Part of tenant empowerment is the ability for tenants to hold landlords to account. You can expect:

1. The RSH to instigate objective and subjective ways to measure tenant satisfaction, e.g. repairs, building safety, tenant engagement, community management and anti-social behaviour (ASB) measures. The White Paper goes as far as to set out draft tenant satisfaction measures.
2. RPs to be obliged to report to tenants on key information annually, including on tenant satisfaction, executive salaries and management costs – in each case relative to the size of the RP.
3. Each RP (regardless of size) must nominate a senior person to be responsible for ensuring compliance with the updated consumer standards. This individual will likely be the CEO for smaller RPs, or a senior executive for larger RPs/local authorities and will be responsible for customer service and driving any cultural change that may be needed.

Again, in our experience most RPs have already been making changes to measure tenant satisfaction, and to improve openness with residents. Now that more clarity is available on the likely measures, further adaptations can be made if needed.

Listening to residents and treating them with respect

The other part of tenant empowerment is around treatment of residents – moving the sector away from a perceived paternalistic approach to residents and towards respectful and meaningful engagement. The White Paper seeks to do this by:

1. Strengthening the Ombudsman – including placing its new complaint handling code onto a statutory footing. 
2. Speeding up resident access to the Ombudsman, e.g. by permitting earlier direct referrals by individuals. 
3. Requiring RPs to put in place best practice, and improve tenant engagement, as part of the improved consumer standards.

It is essential that all RPs review the Ombudsman’s complaint handling code and ensure their systems and processes (including advice to residents who complain) are updated accordingly. In particular, you must self-assess against the new code by 31 December 2020 and publish the results. 

It is hoped that the changes will also lead to great co-ordination between the RSH and the Ombudsman, which would be a positive result for all in the sector. 

Strengthened regulation of consumer standards

Running alongside the key themes of tenant empowerment and safety are the necessary regulatory “teeth” to ensure RPs must adapt accordingly.  These include:

1. The RSH proactively monitoring and driving compliance with the enhanced consumer standard, with additional enforcement powers to fall back on. This will include a new code of practice on the consumer standards plus routine inspections every four years for larger RPs (over 1,000 units) to ensure compliance. Whether these inspections will form part of a beefed-up IDA process, or whether they will be separate, is yet to be confirmed.
2. The “serious detriment” test for consumer standards will be removed, as expected, and RPs will be required to self-report to the RSH for breaches.
3. The RSH will grow, including recruitment of people with the necessary specialisms to support its new role, and the creation of an advisory committee to provide independent and unbiased overview of regulation of the consumer standards.

We will provide a full assessment of the updated consumer standards once these are available. In the meantime, RPs should review policies and systems for ensuring compliance with the consumer standard and make sure these are proactively monitored, with a system in place for self-reporting to the RSH if breaches are uncovered.

Quality homes and neighbourhoods

The desire to improve homes and neighbourhoods is reflected in the White Paper, with:

1. A review of the Decent Homes standard to bring it up to date; and
2. Tackling of ASB a priority.

The updating of the Decent Homes standard was fully expected, and most RPs are already working to their own internal quality standards that cover the issues likely to be included (e.g. energy efficiency and safety). Those internal quality standards will, of course, need to be reviewed in light of full details of the new standards once available.

Encouraging home ownership

The Government has not lost sight of its aim to encourage social housing residents into home ownership, and empowering them to buy their own homes. In particular, the White Paper discusses the number of new homes expected to be delivered and talks about the following initiatives that are being explored:

1. A new and more accessible shared ownership model;
2. A right to shared ownership for grant funded schemes; and
3. The voluntary right to buy pilot.

These proposals will be familiar to RPs but we will be horizon-scanning for developments and will publish further updates when these are available. 

Tightening current economic regulation

It is clear that regulation of the new consumer standards won’t be at the expense of the current governance and financial viability standard. Changes are expected here too, in particular:

1. Tightening up the definition of “non-profit” in the context of RPs;
2. Introducing a notification requirement where there is a change in control of an RP; and
3. Powers to examine financial records from those receiving money from RPs. 

These changes reflect the additional powers the RSH needs to regulate the new generation of “for profit” RPs more effectively.  This signifies that “for profit” RPs, and those working with them, can expect a higher level of scrutiny from the RSH moving forward. 

What to take away?

There is a lot to digest in the White Paper, although as mentioned above, most RPs are already compliant with the changes. The key takeaway, however, is that tenant engagement is more than mere lip-service – the voice of your tenants should be at the centre of everything you do. 

We wait with interest for the new consumer standards, but in the meantime we will be holding a webinar to discuss the White Paper further on 1 December. We hope that you will be able to join us then.