Moving Towards Better Housing- Scrutiny Commission on the Future of Council Housing Amanda Skelton Executive Director, Neighbourhood Services 4 March 2003

Where we started We need to meet the Decent Homes Standard and ensure quality and choice in all housing in South Tyneside The Government expects Councils to look at all options for housing management We are required to have a viable long term Business Plan for our housing stock We want the Best Deal for our tenants, for the Borough and for the Council The future ownership and management of the housing stock is a key decision for the Council

We have heard evidence from: HACASChapmanHendy Community Housing Task Force Housing Corporation Government Office for the North East Tenants Forum Trade Unions Head of Housing Head of Finance Executive Director, Corporate Development And have visited: Sunderland - LSVT Blyth – ALMO Derby Homes - ALMO

What we have learned Hacas Chapman Hendy Stock Transfer or ALMO would increase capital investment and would be the best options. Community Housing Task Force The Government is firmly committed to the 2010 target for Decent Homes Government Office for the North East Business Plan is ‘well above average’ but progress on options appraisal is essential to retain this Housing Corporation Have a role in supporting and regulating stock transfers

What we have learned (cont.) Executive Director of Corporate Development The future of the housing stock will have a major impact on the regeneration and sustainability of the Borough Head of Housing Achieving and maintaining Decent Homes cannot be achieved without extra investment. Housing Association and Local Authority rents will converge by Head of Finance Business Plan needs to be revised in the light of the Communities Plan

What we have learned (cont.) Tenants The vast majority of tenants have not been involved in the process and the Tenants Forum needs information and a clear way forward Trade Unions Generally, are against stock transfer and for stock retention with changes to the current subsidy system. Unison would prefer ALMO if change absolutely necessary.

What we have learned (cont.) From visits: Sunderland LSVT: Tenant focus has improved and investment has increased by £300million. Blyth ALMO: Seemed over-confident in ability to reach 2* rating. Some reservations. Derby ALMO: very positive and customer focussed from the start. Capital resource has substantially increased and extra staff have been recruited.

The Communities Plan – What we know now Financial position is not going to change if stock is retained. 3* ALMOs will have increased freedoms and flexibilities Stock Transfer/ PFI will be easier There will be a regional approach to housing policy Revenue position has improved due to management and maintenance allowances and Supporting People.

Retained Ownership & Management Strengths Tenants have landlord they know and trust Council retain asset and control Stability and morale Weaknesses Rent rises have no impact on investment levels Service needs to drastically improve Behind target on decent homes Investment on regeneration and environment curtailed

Retained Ownership & Management Opportunities Facilitates joined-up working Partnership schemes with Housing Associations Service improvement through Best Value Threats Falling stock levels and service cuts Demand will fall Performance rating will fall Regional Assembly Intervention

ALMO Strengths Tenants have landlord they know and trust Council retain asset and control Freedom and flexibility Tenant control increased Extra investment Weaknesses Upheaval will be hard work Staff work for company limited by guarantee Impact on central services Does not meet all investment needs

ALMO Opportunities New job opportunities Financial freedoms for 3 star Additional incentive for service improvement Partnership opportunities with tenants/others Threats Failure to improve Service level agreements Lack of commitment or capacity Time limited

Stock Transfer Strengths Full investment requirements met Impetus for change Major contribution to regeneration Weaknesses New landlord Set up costs Separation from Council

Stock Transfer Opportunities New job opportunities Financial security New culture Greater tenant empowerment Threats ‘No’ vote Lack of commitment and/or capacity to change Irreversible Council/ Company relationship Procurement process

PFI Strengths Government provides additional subsidy to pay for PFI payments to private sector service provider Opportunity for new build Weaknesses Not a whole-stock solution Complex and costly Lengthy process

PFI Opportunities Could be used to target specific areas/ estates Opportunity to set new service standards Threats Relatively untested, particularly in the long term Likely that PSP would have to make significant cost savings Two-tier housing service

Executive Director’s Summary Retention of Ownership and Management Missed opportunity ALMO Best of both worlds Low Risk - High Gain Benefits and Security for Tenants Stock Transfer A big step High risk – High Gain PFI Limited opportunity

Tenants’ Involvement Tenants perceive that their involvement to date has been substantially incomplete There is a need: For the Council to take a lead on consultation To establish Independent Advisor in a supporting capacity To clarify the options and the potential impact on tenants To involve as many tenants as possible in participative, enjoyable ways This must be done before the Council make a decision

The way forward Prepare a report for Cabinet in April 2003 from the findings of the Scrutiny Commission (to be agreed by the Committee on 1 April 2003) Plan and deliver major tenant consultation (Summer 2003) Revise Housing Business Plan (July 2003) Report back to Cabinet on tenants’ views (Autumn 2003)