George Walker - SFHA Chairs' Conference - 31 January 2020


31 January 2020

George Walker - SFHA Chairs' Conference - 31 January 2020

Good afternoon. Thank you so much for inviting me to join you today. I’ve spoken at this event for the last two years, and I’ve thoroughly enjoyed it. It’s nice to be back.

I’m delighted, as the Chair of the Regulator, to be able to speak with such an important group of people - chairs and governing body members from the RSL sector. I know how committed you all are to making your landlords effective and deliver for tenants. Thank you for all you do.

Last year I spoke with you about the future shape of social housing regulation in Scotland. Time flies! We’re already approaching the end of the first year of a new phase for social housing regulation in Scotland. As you know, our new regulatory framework went live last April. As did our new corporate plan, which sets out our priorities and describes how we will work for the next three years.

So with that in mind, I wanted to have a conversation today that reflects on our new approach, focusing on two themes:

  • early reflections on assurance statements; and
  • our regulatory priorities.

I’m also very keen to hear your thoughts on our regulatory approach through your survey, and discussing these with you. I’m particularly interested to hear the views of you as RSL chairs given the key role you play.

First let me share some early thoughts on one of the key features of our new framework – the annual assurance statements.

I spotted an article last week in Scottish Housing News promoting a governance masterclass being run by a Scottish housing training organisation. The article opened by saying that “2019 will be remembered as the year of the assurance statement”. Ah ha well even I’d need to say that’s just a wee bit of a stretch. But it definitely is true to say that they are one of the biggest changes ushered in by our new framework, and clearly an important new element of the governance landscape for landlords.

So, why did we do it?

Well, very briefly, our aim was - and is - for the statement to be a useful tool for a landlord’s Board, to help it consider the questions to ask and the assurances that it needs. And with that point in mind I’ll be very keen to hear what you’ve said about assurance statements through your survey.

As you all know, landlords submitted their first statement in October last year. So, how has the first round of assurance statement submissions gone?

Well, we received Assurance Statements from 179 landlords – that’s 95% of landlords – by the deadline on 31 October, and we got a further 7 pretty quickly thereafter. So that’s a good start I’d say.

The main problem with those that were late seemed to be a lack of planning around board and committee dates. One remains outstanding, a council, and we are engaging closely with it about their failure to submit.

Most – over 80% - of statements were on one page. Around 20% of landlords disclosed “material non-compliance” with Regulatory Requirements and a further 10% disclosed non-material non-compliance. Many more landlords made reference to having identified areas for improvement through the process of preparing the statements, but did not disclose details.

So, possibly a good indication that landlords have taken a very thorough, open and self-critical approach to assessing themselves against Regulatory Requirements?

Now, of course it is for Boards to decide what they should disclose. That’s possibly a conversation you’ve had within your own organisation. And of course, it is possible that we may have a different view about whether an issue is material or not, and so whether we give an RSL a status other than Compliant. It’s a judgement after all. Indeed, we may take the view that something that a landlord has disclosed is not material or is significant.

We’ll use the statement to help form our view of the landlord and to decide on any engagement we need with them. And we will normally engage with a landlord on its statement only when we need clarification or to discuss any material non-compliance the landlord has disclosed.

We are keen to reflect on what has gone well and what might have gone better in this first year of Annual Assurance Statements. So we are actively capturing the lessons from this first round.

We have this week just completed a programme of visits to ten landlords – 7 RSLs and 3 local authorities - to look at how they got the assurance to let them make their Annual Assurance Statement. Our visits generally involved talking to both governing body members and senior staff. We’ve been asking landlords about their experience in producing the first Annual Assurance Statements: the approach they took; and how they gained self-assurance, particularly around rent affordability and tenant safety.

What we get from these visits, along with our review of all the submitted statements, will help us identify the lessons for landlords and for us.

We’ll publish a lessons learned report by the end of March. But I can share with you today some very early emerging findings. I should say that these come with the caveat that back at the office we’re still reviewing and considering all the issues we covered during the visits.

Early indications from the visits are that RSLs are reporting increased self-assurance than before. They’ve told us the assurance process is a useful learning experience, including identifying of areas for improvement.

We’ve also heard feedback about a spirit of teamwork and co-production between staff and governing body members.

One area where there appears to be a recognition of room for improvement is in relation to tenant involvement. Some RSLs told us that they were unsure of the best way to involve tenants in the process or didn’t have time to gather tenant views. Some said that this would be an area of focus in year 2.

So, look out for our report in March. And I’d be very interested to hear your own thoughts on all this later in the session.

I’d like to turn briefly to our regulatory priorities. As I said in my introduction, we published our new three-year corporate plan last year. The plan describes what we’ll do and what our priorities are. Our priorities will be familiar to most of you:

Value for money and affordable rents – this is about landlords delivering a good service, at a price tenants can afford to pay. We know this is important for tenants. We know from feedback from our National Panel and from speaking to tenants’ groups that many have experienced difficulties in affording their rent or are concerned about the future affordability of their rent.

Tenant and resident safety - this is the most important responsibility on landlords. Most are proactive in meeting it. But, we are engaging with a number of landlords who have been unable to demonstrate that they meet these duties, including around asbestos and electrical safety. Late last year we wrote to landlords about this. And we’ll continue to highlight the importance of tenant and resident safety, and that landlords give tenants a clear way to raise any concerns.

Governance and financial health in RSLs – this is because strong governance is a platform for the delivery of good services.

Homelessness – making sure landlords do all they can for some of the most vulnerable people in our society. It’s one of the issues of our time, and - perhaps more than any other - the one where all of us need to pull together and bring what influence we can to bear.

As you know, local authorities have a wider set of homelessness responsibilities and activities than RSLs. Our homelessness focus, for local authorities, is how they deliver services for people who are homeless or threatened with homelessness. And homelessness is a key area of our engagement with almost three quarters of local authorities.

We all know how complex an issue homelessness is. And it’s not just a local authority issue. RSLs have a hugely important role to play, alongside a wide range of other agencies. I know that many RSLs have made significant contributions, working well with partner bodies. Effective partnership working between RSLs and councils is nowhere more important than on homelessness.

As part of our assessments, we examine how both local authorities and RSLs provide settled accommodation and support people to sustain their tenancy. And you may be aware that we have developed new indicators in our annual Charter return to help us do this.

There are significant developments in policy aimed at addressing homelessness. The Rapid Rehousing Transition Plan approach and Housing First in particular show the commitment of the Scottish Government to promoting new solutions, working with local authorities and other key partner such as yourselves.

In the context of these rightly high expectations, it’s important that you, as RSLs, play your part by looking at how your organisations can contribute to preventing and alleviating homelessness.

This could be through the support and services you provide to help prevent homelessness, maximising the number of lets you provide to people who are homeless and, once re-housed, your work with other partners to help support people sustain their home. This might include helping people to access benefits through welfare rights services and supporting people to manage their rent.

So, with that in mind, I’ll finish by urging you, and your governing body, to look closely at your organisation’s performance and commitment around homelessness.

Ask yourselves:

  • are we doing all we can?
  • is there anything else we can do to contribute?

Let’s all play our full part in improving people’s lives.