SHR Board Minutes - 24 February 2026 - Link House, 2c New Mart Road, Edinburgh

Present

Welcome, apologies and declarations

GC welcomed all to the meeting.  There were no apologies. 

CS declared that as TIS is currently appointed by Blochairn to advise tenants and he is also a Board member with TIS, he will not participate in any related Board discussions or decisions. 

There were no other declarations.  

The Board agreed it was grateful to Link Group Ltd for allowing it to use the meeting space.  

Consent Agenda

The Board noted and approved the consent agenda including:

• the Chair and Member activity report;
• 2 December 2025 Board minutes - subject to an amendment;
• ARAC update from December 2025;
• a private note of the Board workshop in January 2026; and
• the matters arising report.

GC updated the Board on recent meetings with the Sean Neil,  Director for Local Government and Housing, Scottish Government.

MC reported that an extraordinary meeting of the Housing 2040 Strategy Board is planned for 26 February 2026, which is focussed on the Scottish Government’s new housing agency. The Board noted MC attends for SHR and CS attends for Tenants Together Scotland.

The Board noted the ARAC Terms of reference annual review and approved these.  

The Board approved appointment of DJ to ARAC Chair from 1 April 2026 and noted a letter would be issued to confirm this.  It thanked EF for his work as ARAC Chair and noted he will remain on the Committee until March 2027.  

Action: RH to issue an ARAC Chair appointment letter to DJ.

Chief Executive’s report

MC presented on issues and developments that impact regulated bodies, the wider housing environment and SHR.  He updated the Board on the SFHA’s entitlement and benefits policy, highlighting procurement-led changes.  He also reported that SHR approved the voluntary de-registration of Link Housing Association, which was in relation to changes in the Link Group structure.   

The Board considered the report and discussed:

• the new national housing agency, noting the focus is on multi-tenure new housing supply and currently is not likely to include investment in existing homes.  It noted that in previous housing agencies regulation had been involved, but there is no legislative basis for this with the new agency;
• staffing for the new agency;
• RAAC, noting that it is just a one of series of stock condition issues that have emerged connected to component age and suitability;
• cladding, noting that the Scottish Government has not completed the data collection or analysis and SHR does not currently have access to it, although discussions are ongoing.  It discussed if there are risks around access or data gaps from a regulatory perspective and noted that SHR has the tools to collect further data quickly if required. It also noted that landlords are required to report related issues via notifiable events, making landlords’ stock knowledge ever more important;
• landlord approaches to stock condition surveys, noting the variety of approaches and that the Charter returns are based on the latest information available to individual landlords.  The Board also discussed structural and aging component issues emerging, noting that deeper and intrusive stock condition work can be required to clarify. 
• remediation, noting that for cladding that has been reported, the Scottish Government is leading on resolution discussions with landlords;
• information SHR receives about landlord asset management and planned maintenance programmes including assurances from landlords;
• legal advice SHR obtained in connection with the SFHA’s payment and benefits policy, noting this informed understanding of regulatory implications connected to procurement legislation changes.  It also noted that SFHA commissioned its own legal advice and that SHR does not share legal advice with third parties; and
• work Tenant Advisors did to review the information provided by landlords to tenants about SHR, noting aspirations to repeat, subject to resources.

The Board thanked MC and noted the report. 

Reviewing SHR’s Operating Model

MC presented proposals for a review of SHR’s operating model.  He highlighted the importance of the review to ensure that any approaches SHR adopts continue to demonstrate that SHR is delivering its statutory objective and functions.  MC reminded the Board that if the review results in change to SHR’s Regulatory Framework this would require a consultation exercise, which could impact timing.  He set out proposals for phases of review work covering:

• development of the 2026/27 operating plan including capacity to resource the review;
• delivery of the review through four workstreams from April to September 2026 covering:
  • public body duties and digital and business services;
  • regulatory approach;
  • stakeholder engagement; and
  • future legislation considerations. 

MC emphasised the importance of staff and stakeholder engagement as well as robust risk management.  He reported that SHR will adopt a programme management approach to the review, while being mindful of resource overheads.   MC reported the final phase of the review would be determined by the output of first two phases.  Finally, he explained the importance of communications and how will include seeking external perspectives. 

The Board considered welcomed the proposed approach.  It discussed:

• immediate budget pressures and overspend if no vacancies emerge during 2026/27, noting this is currently forecast as up to £270K overspend;

• the importance of establishing the Board’s risk appetite for any changes to SHR’s regulatory approaches, noting it and risk tolerance will need to be considered at every stage and that MC will bring forward options.  It noted that risk tolerance will need to increase, but that SHR would also look for mitigations and moderation tools.  It agreed the importance of understanding financial, regulatory and reputation risks;
• early feedback from stakeholders including UK Finance, who have noted SHR’s budget position and are keen to understand the implications;
• timing of the outcome of the current risk assessment and how engagement plans will detail work with landlords during 2026/27;
• importance of the Board involvement around risk appetite and tolerance, also noting planned work with Internal Audit around risk management;
• how SHR will balance the review work alongside continuing to deliver effective regulation.  It noted previous change exercise experience in SHR and the importance of a tight operating plan, including resisting taking on unplanned new work to protect capacity for the review;
• the forthcoming Scottish Government elections, noting the outcome will include working with a range of new stakeholders;
• scope to commission consultation work to support the review before the end of March 2026, noting that management capacity is restricted.  It welcomed that SHR will look for support opportunities throughout the review;
• the importance of identifying what SHR is compelled to do, what adds the most value and the consequences of not taking forward any aspects of SHR’s current work and approach, agreeing it is important to be explicit around this;
• external perspectives, encouraging MC to look beyond Internal Audit;
• the place of thematic work in the delivery of statutory functions and in the context of the Strategic Code for Regulators, noting SHR’s duty to monitor, assess, report and intervene and that how it does that is for it to determine;
• risks to tenants and service users, noting that this is currently covered in the Board paper template under contribution to statutory objective and regulatory priorities.  It asked MC to consider setting any risks out separately in Board papers. 

The Board thanked MC and his team.  It approved the proposed approach for the first two phases of the review of SHR’s operating model and noted the associated timescales.  It asked MC to take account of Board feedback around risk and other areas in developing and working through the review.  

Action: MC to implement the review of SHR’s operating model and take account of Board feedback. 

Outline Annual Report 2025/26

RH presented the outline annual report structure to the Board.  She highlighted how this is determined by the Financial Reporting Manual and that in general follows that of the 2024/25 format.  RH outlined the associated timescales including the consequences of a slightly earlier onsite audit work.

The Board noted a draft will be provided to it for consideration on 31 March 2026 and the process thereafter.  It approved the outline structure.

Actions: RH to develop a draft annual report narrative for the Board to consider on 31 March 2026.

People and Board survey outcomes

IM presented an overview of the 2025 Civil Service People survey and staff survey about the Board.  He highlighted the very positive feedback and reported that for overall engagement, SHR score remains strong and is equal second highest amongst the 102 organisations that participated in the UK.  IM explained the next steps around work with staff and Management Team. 

The Board welcomed the positive feedback.  In particular it welcomed scores around stress measures.  The Bord noted the context for the forthcoming team and Management Team discussions and that these are planned in a proportionate manner and agreed they are even more important given the forthcoming operating model review work.

The Board noted the results from the two surveys and thanked staff for participating and providing useful feedback, which it agreed it will take into consideration when agreeing future work plans.  

Budget update

IM presented the budget position at 31 December 2025.  He highlighted that the underspend is forecast as £60K for revenue and £12K for capital.  IM explained this is mainly the result of holding posts vacant in anticipation of the Scottish Government’s spending review and that some temporary recruitment created internal vacancies, which contributed to the underspend in the staff line.  IM reported that SHR does not expect to have to draw upon the contingency budget. He confirmed that underspend is returned to the Scottish Government. 

The Board noted the expenditure in the year to date and the current forecast outturn for capital and revenue budgets. 

Q3 Corporate Performance Report

MC presented the Corporate Performance Report for quarter three 2025/26.  He highlighted the importance of the report in tracking SHR performance and in the future the impact of the review on SHR’s other work plans. 

The Board thanked MC and noted the Corporate Performance report for quarter three. 

Regulatory engagement – serious casework

HS presented an update on the most serious regulatory casework.

HS updated the Board on engagement with Blochairn Housing Association.  The Board noted work to understand the stock quality and the funding that will be required to resolve component and safety issues.  It discussed potential lessons for all involved to take into account when considering development and regeneration work and if there is a role for SHR to commission something to draw these together, while noting resourcing limitations.  It noted that ongoing casework remains complex.   The Board noted that Blochairn’s engagement plan is available for others to consider in the context of their own organisations. 

The Board discussed wider issues around governance of development work and how governing bodies can be supported.  It discussed the role of Building Control, the importance of scrutiny and how failure tends to emerge from lack of knowledge or understanding.   It discussed the skill of landlord boards in handling development and how Audit Scotland work could help support them.  The Board noted the important role Clerks of Works play in protecting the landlords and the potential assurance gaps and risks of not having this oversight.

Following the discussion about Blochairn, GC welcomed CS back into to the meeting.

The Board continued to discuss issues around stock quality and how issues emerge.  It noted issues sometime only emerge at the point of something going wrong as issues may only be uncovered via significant intrusive survey work or while carrying out other unrelated works.  It agreed that it was vital that there is due diligence when building and noted this would be something for the new housing agency to consider further. The Board also noted that some components of previous development and regeneration work are now known to be beyond the intended lifespans.  It noted the funding risk, agreeing this is for Scottish Government to consider. 

MC explained that SHR is continuing to message the importance of stock quality knowledge and this will continue as landlords respond to the Scottish Government’s policy agendas. It noted that within a building, different elements will have different lifespans and these should be fully understood and inform maintenance programmes.  The Board noted that good quality specifications at the outset will assist maintenance programmes.  It noted the challenging decision context around volume and value for money and how mixed-use developments can have differing specifications.  The Board also noted these issues are experienced throughout the UK. 

HS also updated the Board on RSLs that are now compliant and on SHR’s work with local authorities.   She reported that several case conferences are planned that could impact the regulatory status and future engagement with some RSLs.  

HS confirmed that SHR cannot oblige landlords to participate in common housing registers and that policy on this is a matter for Scottish Government and individual landlords.  

The Board noted the updates.  

AOB

MC presented a draft response to the Scottish Parliament’s Local Government, Housing and Planning Committee and set out related timescales.  The Board considered the response and agreed it was important to reflect that SHR is currently holding vacancies to help the Committee understand the implications of SHR’s funding settlement.  The Board noted that this will be SHR’s last correspondence with the Committee before it prepares a legacy report for the next Committee that will be formed after the Scottish elections. 

Action: MC and GC to update the letter to reflect Board feedback and provide it to the Committee.  

Agenda planner

The Board noted the agenda planner and agenda plans for the next meeting in March 2026.  

Effectiveness of meetings and papers

The Board considered the effectiveness of the meeting and papers.  It agreed that it was content. 

DONMs

The Board will meet on 31 March 2026. 

Workshop

Following the meeting, the Board attended a workshop hosted by the Link Group Senior Management Team.   Scottish Government colleagues Matt Elsby, Deputy Director Better Homes, and Will Tyler Greig, Deputy Director More Homes, also attended.   

Breifings

Between the 24 February 26 and 31 March 2026:

• SHR publications
• Media updates
• Local Government, Housing and Planning Committee work
• Letter from the Cabinet Secretary for Housing to the Parliament on More Homes
• Consumer Scotland report