The National Assembly of Wales’ Public Accounts Committee

Inquiry into Regulatory Oversight of Housing Associations




About Us:


TPAS Cymru works to improve the lives of social housing tenants in both housing and community matters, by promoting effective participation of tenants with their landlords and with other partners in issues that affect them. We have supported social housing tenants and landlords in Wales for over 25 years and have a strong track record in developing effective participation through training, support, practical projects and policy development.



This Response is based on:


·        Our experience of working with tenants and tenants groups and listening to their views.

·        Our observations and dialogue with our members and partners within the HA sector

·        Our membership of the RegulatoryAdvisory Group

·        Our work to improve partnerships between tenants and residents and their Housing Association landlords and other partners.



TPAS Cymru welcomes the opportunity to respond to the Public Accounts Committee Inquiry into Regulatory Oversight of Housing Associations and we have responded to each of the terms of reference as set out in the consultation paper;




1.            The effectiveness of the current Regulatory Framework for Housing Associations Registered in Wales? 


1.1   The current Regulatory Framework for Housing Associations (HAs) Registered in           Wales has evolved and developed since its inception. Welsh Government has           worked with the housing sector, including tenant organisations such as            ourselves, to continually develop and improve the framework to ensure it            operates effectively to protect tenants and investment in Welsh Housing   Associations.


1.2   Changes within the last 12-18 months including the establishment of an independent Regulatory Board (RBW) and a reinvigorated Regulatory Advisory Group (RAG) have been positive moves. As members of the RAG, we have seen an improvement in openness, dialogue and communication between the housing sector and Welsh Government which is helping focus the work of the Regulation Team. This is strengthening the co-regulatory approach and thus supporting HAs to provide quality homes and services to their tenants.


1.3   Published outputs from the regulation team have changed to much shorter           ‘exceptions based’ Opinion Reports and there are some doubts as to the value of      this information in enabling Tenants to see clearly how their landlord is      performing. The current reports do not appear to be widely used or relied upon             by Tenants.


1.4   In the interests of openness and transparency there are other outputs from   regulation, such as individual landlord self evaluations, which could be         disseminated more widely. A suggestion would be that landlords are encouraged           to ensure this information is advertised and made more widely available to their           tenants and other local stakeholders.


1.5   The framework continues to evolve and develop and we are supportive that the           principles underpinning the Regulatory Framework continue to be the right ones      i.e. that Tenants should be at the heart of regulation; that individual housing       associations should be responsible for their own actions; that regulation should      be open, transparent, consistent and proportionate; and that regulation is          founded on co-regulation.


1.6   The proposed revised approach to regulation, to include a focus on continuous           improvement and a clear Regulator’s ‘judgement’ are welcomed. This new     approach will need to be adequately resourced to ensure the Regulation Team   have the capacity to deliver the changed framework. The team will also need the      capacity to engage directly with tenants and stakeholders at a local level to      gather relevant intelligence and evidence as part of each HAs regulatory process.


2.       The effectiveness and quality of governance arrangements?


2.1 Without having an in-depth knowledge of each HA in Wales it is difficult for us to        make a blanket statement about the effectiveness and quality of governance        arrangements across the country. However, in general terms we have observed        consideration and work undertaken by boards and senior management teams to        improve governance over the last couple of years.  We’re aware that the quality         and effectiveness of boards seems to be improving and frameworks for good      governance including CHC Cymru’s ‘Code of Governance’ appear well understood            within the sector.


2.2 There has been a general shift in the sector towards more inclusive and rigorous        recruitment methods to help strengthen governance by widening skills and       diversity at board level.


2.3 Whilst many boards display a strong commitment to tenant involvement at board      level how meaningful and successful that is in practise seems to vary. Boards need           to explore opportunities to develop clear and direct links between their tenants and the work of the board. This could include engaging with tenants at strategic        level as well as offering opportunities for effective challenge of landlord     performance and decision making such as through tenant scrutiny.


2.4 Involvement of tenants in governance need not always directly translate into   board membership: if tenants feel they may have stronger voice and to challenge   and hold their landlord to account from outside of the board then this approach        needs to be made available to them.




3.       Whether the current regulatory regime is effective in managing and mitigating sector wide risks?


3.1 Housing associations face an increasing range of risks in delivering their objectives      and managing their businesses. Boards are expected to consider the extent to      which their strategies and business plans could cope with threats, including            changes in the economy, housing policy and related areas including welfare,    health and social care.


3.2 The current regulatory regime appears to be well focussed to respond to risks faced by the sector and the regulator plays a significant role in identifying          potential sector wide risks including producing a paper specifically on this.  The            document produced is useful for the sector, stakeholders and tenants, helping    them to         identify and prepare for broader risks.


3.3 The identification and sharing of new and emerging risks is also covered by a    regular agenda item at the Regulatory Advisory Group meetings.


3.4 TPAS Cymru’s experience is that tenants can provide useful evidence and        information regarding some potential local and service risks faced by their         landlord.  It may be useful for the regulation team to ensure they dedicate           sufficient capacity to enable them to engage directly with tenants and    stakeholders at a local level.  This would provide them with an opportunity to discuss any particular risks identified by them as part of the regulatory process.


3.5 More openness by the regulation team, where possible, would be welcomed   in        terms of the sharing of lessons learnt relating to managing and mitigating risks             e.g. how failure to manage risks by HAs is resolved by boards and how regulatory        interventions by the regulation team have protected tenants. This would help to        demonstrate the effectiveness of regulation and provide reassurance to tenants.


3.6 The proposed revised approach to regulation, including clear standards and        ’judgements’, should place a continued emphasis on risk and the HAs ability to        manage particular risks facing their organisation to protect tenants and investment in Welsh HAs.  




4.       The effectiveness of the co-regulatory approach in practice?


4.1 TPAS Cymru believe that Co-regulation remains a key element of the regulatory        framework and we therefore support the retaining of this focus.

       In a co-regulatory environment, honest, robust self evaluation is essential and offers mutual benefits. This approach raises expectations that individual HAs            assess their own performance honestly and challenge themselves to drive their   own continuous improvement.


4.2 Where co-regulation appears to be working well is where HAs see self-evaluation       as being fundamental to their organisation’s performance management and not         just part of the regulatory framework.


4.3 Some HAs appear to have devoted considerable resources to self evaluation with        boards also ensuring tenants are engaged in the process and provided with the        opportunity to reflect on the health and performance of the Association.           However, it is not clear if all HAs enable tenants to be engaged in self evaluation             ensuring it is a reliable view of the Association’s performance; this is despite of            clear guidance from the regulation team for them to do so.


4.4 Effective self evaluation is one of the ways in which a Housing Association can be        accountable to tenants, service users and other stakeholders by publishing

       an evaluation of their health and performance in a way that is readily accessible          to tenants. Many individual self evaluations are not made openly and easily       available by HAs in a range of accessible formats.  This lack of openness limits the           opportunities for tenants to challenge or validate their landlord’s performance     which would ultimately provide mutual benefit for all.




5.       The remuneration of senior executives of housing associations?


5.1 As independent organisations the remuneration of senior executives of HAs is a        matter for each HA board. However in the spirit of openness it is TPAS Cymru’s        observation that there is a need for HAs to have clear, transparent and published        policy rationale for setting senior executive pay. This could include a published        policy by a HA that states what the market position and rationale is for senior   executive pay decisions. Boards also need to be experienced, trained and             advised about remuneration.


5.2 Remuneration of senior executives should focus on whether HAs and their        tenants are getting the best possible value for money and return from their senior    executives’ investment.



TPAS Cymru – January 2017