Five key recommended improvements to housing association law

(Title Image: WLGA)

External Affairs Committee (Sub-Committee)
Stage One Report: Registered Social Landlords Bill (pdf)
Published: 31st January 2018

The Registered Social Landlords Bill (details here) was introduced to take housing associations back into the private sector following a re-classification as public sector bodies by the Office of National Statistics (ONS).

The ONS decision – based on Welsh Government involvement in the sector – led to fears that housing associations would no longer access private funding, potentially costing them £200million a year.

1. The Senedd should support the general principles of the Bill, but be wary of de-regulation

Everyone who gave evidence to the sub-committee said the Bill was necessary. Community Housing Cymru believed that if the ONS decision wasn’t overturned it would “fundamentally change” the way housing associations operate.

The Sub-Committee argued the Bill – which will remove some of the Welsh Government’s involvement in the sector – was a step towards de-regulation of housing associations and required “diligent risk management and monitoring”.

2. Cutting local authority housing board members is necessary, but there’s a need for clarity on “independent” board members who are also councillors

The Bill will restrict the number of local authority-appointed housing association board members to no more than 24% of a board’s entire membership. This is consistent with the governance arrangements in the rest of the UK, but the Welsh Government were keen to reassure local authorities that their membership would continue.

However, there was a need to clear up whether a councillor appointed to a board as an independent member in their own right still counted as a public sector appointee.

3. There needs to be clarity on when the Welsh Government can intervene in housing associations

Witnesses said the “threshold of failure” after which the Welsh Government can intervene in a housing association lacked clarity in the Bill. A new Regulatory Framework will regulate the sector and the Welsh Government confirmed that breaching this framework would pass that threshold of failure (“failure to comply with a requirement imposed by or under enactment”).

The Sub-Committee believes breaching the Regulatory Framework has to be specifically included in the Bill as a cause for intervention.

4. The Bill doesn’t do enough to strengthen the role of tenants

An equivalent Bill in Scotland had clauses whereby tenants have to be consulted and involved in any major decision taken by a housing association or social landlord. The Welsh Bill doesn’t and witnesses agreed that it should as long as it didn’t affect the reversing of the ONS’s decision.

5. The Bill needs close monitoring after being passed

There were some concerns over the Welsh Government’s retained regulation-making powers because it may put off funders if they believe there’s an open-ended opportunity for Ministers to change the law suddenly.

The Sub-Committee also recommended the Senedd conducts post-legislative scrutiny of the Act (if passed) to ensure tenants’ rights are safeguarded and that housing associations and social landlords are not selling land and assets in a way the Welsh Government wouldn’t otherwise expect.

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