ESTUARY ANNUAL REPORT 2016 HOMES AND SERVICES MEETING LOCAL NEEDS
Annual Report 2016 Page one
Our vision
TO BE THE PREMIER SOCIAL BUSINESS IN OUR AREAS, MAINTAINING GROWTH AND EXCEEDING CUSTOMERS’ EXPECTATIONS Section one Chief Executive’s Statement
Section four Development
Section seven Housing and Communities
Section ten Value for Money
Section two Chair’s Statement
Section five Operations
Section eleven Board Members
Section three Our homes
Section six Property Services
Section eight Caring for and supporting people Section nine Corporate Resources
Section twelve How we run our business
Section thirteen Average rents per local authority area Section fourteen Financial Performance
“IN MY 34 YEARS WORKING WITHIN SOCIAL HOUSING I HAVE NEVER EXPERIENCED A PERIOD OF SUCH SIGNIFICANT AND...
Paul Durkin, Chief Executive
Annual Report 2016 Page three
Section one Chief Executive’s Statement
In my 34 years working within social housing I have never experienced a period of such significant and fast-paced change. The past year brought with it a change of government with a very clear focus on increasing the provision of home ownership opportunities as a means of addressing what almost everyone recognises is a housing crisis. At the same time, the government continued to roll out the implementation of its welfare reforms including the new Universal Credit. Perhaps the most significant and direct change was the implementation, from April 2016, of the first year of four in which social housing landlords must reduce the majority of their rents by 1% each year. Whilst on the face of it this would seem to be good news for tenants it will mean that we will need to review our services and programmes of work as we will have less money to spend on them. However, I can assure you that we will mitigate the impact as far as possible by re-doubling our efforts to constantly improve our efficiency and value for money.
And, looking ahead, there is more change to come. Probably most significant will be the impacts nationally, and within the housing sector, of the referendum decision to proceed with negotiations to exit the European Union. I will avoid the inevitably doomed temptation to predict what these impacts will be but the current levels of uncertainty will likely adversely affect our ability to borrow money to develop new homes, particularly as early indications are that an initial response is a falling away of property values and housing market activity levels. We are faced with a couple of years of uncertainty I fear. In terms of our performance during the year I have largely better news: Thanks to the efforts of all colleagues, and despite the impacts of welfare benefit reductions for some tenants, we achieved our highest rent collection rates across all tenures for several years and our rent arrears as a percentage of the annual rent debit fell as a result. At the end of the year all of our properties complied with the “decency” threshold and we are fully compliant in respect of gas safety with no properties having an expired certificate.
Satisfaction with the repairs service increased over the year although we are still working very hard with our contractor partners, Morgan Sindall, to further improve performance. 150 new homes (affordable rent and shared ownership) were completed during the year. Our financial performance during the year was also very good, adding further to the fundamental strength of Estuary whilst still supporting our growth. We remain committed to working directly with our tenants and, in this respect, there has been some excellent work done by the Federation of Estuary Residents and the Estuary Residents Services Review Panel identifying some specific service improvements for implementation. We are also ensuring that all tenants are fully aware of the implications for them of welfare benefit reforms. We continue to be very proud of the homes and services we provide, through our Supported Housing and Care service, for a number of the most vulnerable in our communities throughout Essex. I welcome the opportunity to extend my thanks to all involved tenants, colleagues, Board and Committee Members and partner organisations for the part they have played in another successful year in a difficult operating environment. Paul Durkin Chief Executive
That was a year that was... and there’s more to come!
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Annual Report 2016 Page four
Section two Chair’s Statement
As the Chief Executive states, the year has seen unprecedented change for Estuary Housing Association and the housing association sector more generally, and I want to open my Report by expressing my appreciation for the way the Board, the executive and indeed all Estuary staff have responded to these changes by mapping their impact for the organisation and our residents in particular and working to mitigate the risks which we might face as a consequence. As I write this, we are only just beginning to assess the impact of the referendum decision to leave the European Union which has already brought about a change in the leadership of the country with a new Prime Minister forming her administration. We wait to see what the effect of any changes in policy initiatives or emphasis by the new administration will have on the sector and Estuary. These past changes which we have tackled effectively as a team have if anything reinforced my confidence in the viability and sustainability of Estuary’s business model and leave us well placed to deal with the uncertainties we continue to face. We have continued to deliver new properties in a range of tenures, including the complex development of Vickers House in Romford and the high quality development of the
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Sunlight Laundry site in Southend, and we have met our targets under the agreements with the Greater London Authority and the Homes & Communities Agency. Looking ahead and recognising the need to generate surpluses to support Estuary’s affordable housing ambitions, our subsidiary Accession Homes Ltd has entered a joint venture with an experienced private sector developer to build 9 executive homes for sale in the London Borough of Havering. As a charitable organisation we do not distribute surpluses and can deploy our surpluses and the strength of our balance sheet to drive our core business of affordable housing in line with our own social objectives and coincidentally also Government policy. The turbulence experienced by the sector has also placed greater demands on the Board and I want to pay a warm tribute to my fellow Board Members for the way in which they have stepped up and grappled with these challenges. A recent Board Appraisal shows that we have the competencies and skills required to guide Estuary for the future and we are strengthening our Committees by recruiting independent external experts where appropriate to help guide the deliberations and decisions.
In September two of our members, Ron Horncastle and Adetunji Oyewunmi are coming to the end of their 9 year service on the Board. Both have deployed their financial and commercial expertise for the benefit of Estuary and we shall be sorry to lose not only that expertise but also the corporate memory which they brought to our meetings. They leave with my thanks and those of you all for the consistent valuable service they have given. We have completed a recruitment process and two new Board Members will join us in September. In closing I want to thank all my fellow Board and Committee Members our dedicated staff, led by Paul Durkin, the Chief Executive, our partners, stakeholders and above all our residents, a number of whom I was able to meet during the year. George Kieffer, Chair
Annual Report 2016 Page five
St Edmundsbury
Uttlesford
Babergh
1
1
1
1
6 38
Braintree
154
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Section three Our homes
198
Stock owned and/or managed as at 1/4/2016
Colchester
30 35
Harlow 3
Housing stock total
49 49
Tendring
8
9
47
90
241
99
296
3 Chelmsford
Supported Housing and Care
305
Shared Ownership Housing
430
Epping Forest
Brentwood
27 Owned Housing 3,586 general needs housing (this includes Intermediate and Market Rented housing)
Total
Suffolk Coastal
4,321
6
176
London Borough of Barking and Dagenham 9 133 142
London Borough of Redbridge
111 London Borough of Havering
8
5
25
175
20
180
53
4
203
Maldon
121
Thurrock
4 16
Basildon
41
37 3
Rochford
Castle Point
61 Southend-on-Sea
139
17
179
18
192
45
8
45
116
16
116
69
403
37
151
1256
527
407
1517
460
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Annual Report 2016 Page six
Section four Development
We are always looking for ways to increase the number of homes we can offer and believe it is important to build communities not just homes.
150 New homes completed 140 New homes currently in the pipeline These units are comprised of affordable rent and shared ownership.
Received grants totalling £10,405,000
130 New homes built 2014/15
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Sunlight Mews Homes: 27 Affordable rent: 19 Shared ownership: 8 HCA Grant: £675,000 Total Scheme Cost: £6,397,508
Section four Development Roneo Corner/Vickers House, Romford Homes: 93 Affordable rent: 56 Shared ownership: 37 GLA Grant: ÂŁ9,017,000
Section four Development Victoria Road, Romford homes: 24 Affordable rent: 14 Shared ownership: 10 GLA Grant: £730,000
Annual Report 2016 Page nine
Section four Development
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Homes and Communities Agency (HCA) and Greater London Authority (GLA) funded schemes completed by March 2016. ■ Essex ■ London
19 affordable Rent Homes
70 affordable Rent Homes
8 Shared Ownership
53 Shared Ownership
Total 27 Homes
Total 123 Homes
£ Grant £675,000
£ Grant £9,730,000
Stafford Avenue, Romford Shared ownership: 6 GLA Grant: £919,772 Total Scheme Cost: £931,282
Annual Report 2016 Page ten
Section five Operations
Although this year has seen considerable change in the political and economic operating environment, for the Operations Directorate it has been a year of consolidation and concentration on performance. The new staffing structure has started to really support our work to improve performance, most notably in our Income Team, who achieved the best rent collection performance in the last five years and our response to anti social behaviour and partnership working which has been commended by Essex Police as being “sector leading.” The Property Services Team has continued to deliver health and safety compliance, as evidenced by achieving 100% current gas safety checks across our stock. In Supported Housing & Care, we continue to provide person centred services to some of the most vulnerable people in society and
have achieved consistently “good” outcome scores from the Care Quality Commission following their inspections. We continue to work hard with our partners Morgan Sindall to improve our repairs and maintenance service which, although delivering increasing levels of customer satisfaction over the last year, is not yet delivering excellence. We understand this is often the most important service to our residents and we are looking to make significant improvements over the coming year. The Operations Directorate is largely a customer service function and, as such, we rely on a team of dedicated and skilled staff to deliver those services, together with our partners. I would like to take this opportunity to thank all members of the wider Operations Team for their continued hard work and commitment. Ian Martin, Executive Director of Operations
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Annual Report 2016 Page eleven
Section six Property Services
!Responsive Repairs
!Alternative Energy
2015/16 saw some much welcomed improvement in the quality of our repairs service with an improving trend in customer satisfaction and first time fixes. A great deal of hard work has been done to ensure our delivery model has evolved and changed and we look forward to seeing further improvements in the coming year.
We have continued to explore alternative means of keeping our residents homes warm and providing more cost effective systems.
"Investing in our planned maintenance
"Better, cheaper solutions We have been innovative in 2015/16 to ensure better value for money in delivering a number of projects to improve the living environment for our residents. This has included the use of air source heat pumps to provide affordable heating and hot water to properties that have no access to mains Gas and the installation of prefabricated extensions to cut down on construction cost and deliver much needed extra space quickly and cost effectively.
2015/16 saw us carry out over 1300 planned improvements to our residents homes at a cost of nearly £3,000,000 these included: £610,000 on Boiler replacements £770,000 on new Kitchens and Bathrooms and £655,000 on replacement windows and doors "Compliance Statutory compliance has remained high over the year with 100% compliance being maintained in key areas such as gas safety, water hygiene and communal electrical testing, ensuring our residents homes remain safe place in which to live.
We will continue to explore more innovative solutions to the challenges we face in delivery high quality solutions in times of reduced budget allocations and income.
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Annual Report 2016 Page twelve
Section seven Housing and Communities
Tenancy During 2015/16 the Tenancy team let newly built and refurbished homes to over 250 households . In addition the team visited approximately 830 homes to carryout both tenancy reviews and tenancy audit checks. As part of the process of letting new developments during 2015/16 we undertook a number of tenancy sustainment workshops with prospective new tenants highlighting both the tenants and Estuary’s responsibility. Estuary received over 1000 reports of various forms of ASB with noise nuisance being the highest reported issue. Despite our efforts we evicted 4 households for ASB demonstrating that Estuary takes seriously the impact that ASB has on the lives of its tenants. Rent collection Estuary exceeded past performance by collecting over 101.5% of the rent due and reducing rent arrears by over £200k when compared to the previous year. This performance was enhanced by the contribution of our specialist welfare experts who brought in additional rental income whilst obtaining over £60k in additional benefits directly for tenants. During the year we changed direct debit payments to allow tenants to pay their rent on any day of the month rather than just the 1st or 15th. Tenants welcomed this approach and the numbers of tenants paying by this method increased by 140 over the first 6 months. Thank you to the vast majority of tenants who pay their rent promptly!
We reviewed and strengthened the Market Rent team during 2015/16. One of the positive outcomes of this saw the team collect over 106% of the rent due and reduce rent arrears to their lowest level for over 5 years. In addition the team visited 99% of all homes!
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Annual Report 2016 Page thirteen
Section seven Housing and Communities
Over the last year we have continued to work closely with existing and formed a number of new Residents Associations. We currently have 8 Residents Associations spread across our wide geographical area and held meetings 25 times throughout the year. Federation of Estuary Residents Our Federation of Estuary Residents (FER) held their biggest ever AGM and a BIG day out in Southend in early September 2015. The event was a great success with 93% of residents who attended saying that they would recommend the event to other residents. Volunteering During the last year our involved residents gave approximately 500 hours of their own time to work on behalf of other residents and Estuary. Thank you for making a difference. Residents Scrutiny Panel Our Residents Scrutiny Panel (ERSRP) scrutinised our Former Tenant arrears work and made 15 recommendations to help improve performance. The excellent work of the panel was recognised when they were shortlisted for the National Customer Scrutiny Inspection awards.
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Record attendance at the FER AGM
2 residents went back to work after regularly attending the job club
8 Resident Associations
Volunteers gave 2234 hours
15 recommendations from the Scrutiny Panel
15 policies approved by the Federation of Estuary Residents
Amount of hours spent training last year was 160
Annual Report 2016 Page fourteen
This year has been about the quality of our services. This involved our first Care and Support conference. The theme was ‘making a difference’ and we concentrated on our key quality streams of: Confidentiality Communication
Section eight Caring for and supporting people
Dignity Home environment
Our committed, enthusiastic, knowledgeable staff make sure we provide good quality, personalised care and support. This year our staff have been the focus of our celebration of success; our first Care and Support Conference.
Social inclusion Safety Health and well-being Mealtimes and nutrition We know that our good practice in supporting people to make the most of all opportunities in these key areas means that we can make a real difference to people’s feeling of well-being. Awards were presented to staff who have demonstrated good practice and have made a difference in their everyday support of people. Staff were encouraged to be creative and to identify how to ensure that the service people receive was personalised and met their needs. Our nursing services have been participating in monthly workshops where they share best practice and provide clinical expertise across the services. The group have been supportive in the process of revalidation which is when the nurse needs to submit evidence of their good practice to the Nursing and Midwifery Council. We have worked hard to make sure that our services are seen as being value for money and are as efficient as possible. We have taken the management of our bank staff in-house. This has saved money and has allowed us to be more responsive to the needs of the people we support.
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Our work on making sure our services are good quality underpins all our endeavours. We have invested in a team of knowledgeable staff who work to provide internal audit and compliance and provide the services not only with expertise around meeting the standards prescribed by our regulator but also develop our services so that we don’t just meet but we exceed expectations.
Our services are regularly inspected by Care Quality Commission and are regularly described as ‘good’.
“Staff knew people well and treated them with dignity and respect. They were kind, caring and compassionate in their approach.”
Annual Report 2016 Page fifteen
Section eight Caring for and supporting people We supported a total of 177 people
We were inspected by the Care Quality Commission on six of our services to the key characteristics of whether they were safe, effective, caring, responsive and well led.
During the year we held five events for the people we support including a summer sports day
We have 154 permanent staff and 75 bank staff to provide this support
Five services achieved an overall ‘good’ rating, which means that they were achieving the standard. Only one service was judged as ‘requiring improvement’ and a service improvement plan was immediately created to ensure that the service will meet the standard well on the next inspection.
Voice newsletter produced quarterly
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Paulette Green, Woodgrange Drive Estate Third place winner of the Estuary in Bloom competition.
Annual Report 2016 Page seventeen
Section nine Corporate Resources
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I am pleased to report that the Corporate Resources Directorate had a busy, successful year. We rose to the additional challenges of a changing political landscape and policy arena, along with additional governance requirements of the Economic Standards and NHF Code of Governance 2015. We have taken account of a reduction in our future income, for the next four years, through the financial planning process whilst ensuring continued viability, alongside our ability to continue to develop affordable new homes for those in need.
Our Customer Contact Strategy implementation continued, with the introduction of the ‘One Number’ for Estuary, reducing line rental and call costs and improving the customer experience. Average monthly call volumes to the team have increased from 2,800 to 4,000 per month, with an average answer time of 11 seconds.
During 2015/16 we out-performed our budget and maintained our focus on Value for Money (VFM), whilst also introducing the new International Financial Reporting Standards (IFRS) method of accounting in our Financial Statements. We activated our Development subsidiary and commenced our first scheme of 9 outright sale units to provide cross-subsidy for the Association’s affordable development activity, ensuring appropriate facilities were in place without placing social housing assets at risk.
We delivered 265 sessions of training and development to our staff, with a total of 3,269 attendees. Many of our staff received more than one training session. This helps us to continue to deliver improved services, in line with our core values of Excellence, Care and Innovation.
We continued to develop our ICT Systems to improve efficiency and effectiveness, including Telephony system upgrades, with Session Initiation Protocol (SIP) line integration for enhanced Business Continuity and call cost savings; and continued Security Infrastructure upgrades and Customer Relationship Management system development.
We retained our Customer Service Excellence (CSE) Award for a seventh year, recognising our employees’ dedication to delivering customerfocussed services throughout the year.
The following pages set out a summary of the value for money provided by Estuary Housing Association Group, with a full value for money self-assessment 2015/16 accessible on estuary.co.uk/vfmsa1516 Amanda Ashley-Smith Executive Director of Corporate Resources
Annual Report 2016 Page eighteen
Section ten Value for Money
The Association is fully committed to providing value for money to our residents and the general public/taxpayers. We consider financial implications within all decisionmaking processes of the Board; and our aspiration of continuous improvement in all areas helps us to deliver increasingly high value for money. The Board is fully committed to delivering value for money and recognises its importance. It is vital, from a business perspective that we continue to seek and implement efficiencies throughout our operations. We must be able to demonstrate that we spend money in a way that achieves the best outcomes for the least money. This does not mean that the cheapest option will necessarily be the best and so we will strive to ensure that we get the balance right between cost and quality in all that we do. Our Value for Money Strategy is updated regularly. Efficiencies are recorded, monitored and reported via our business plan and annual reports; and savings are recorded using a corporate template throughout the year. Cashable savings of £949,384 were generated over the period 2015/16, a good achievement in the light of the previous year’s savings of £997,066; of £1,176,800 during 2013/14; and of £638,578 during 2012/13. In addition, the Association has undertaken significant service improvement initiatives during the year. An analysis of these savings at a departmental level can be viewed in our full VFM Self-Assessment, using the hyperlink at the end of this section. This year, we spent £19,034,000 on the acquisition, development and improvement of housing properties, ensuring that our core business, of providing homes for those in need of social housing, continues to expand.
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Our Treasury Strategy was reviewed during the year, to reflect the changed Housing policy environment and our additional facilities, and continues to target the generation of an operating surplus annually, in order to reduce our borrowing requirements for the development of further affordable housing. These surpluses supplement the reduced grants currently available for such development and along with the third party loans, which can be raised on our new homes, enable the Association to raise the necessary funds to complete the developments while at the same time maintaining gearing covenants at an acceptable level. Our VFM position is improved through a reduction in the value of interest payments required to develop new homes. Following the Management of Change process, which became fully operational and embedded last year, we have put in place a talent management strategy, to derive maximum value from our investment in staff training and development. Our teams have been designed in a way that supports the achievement of our business objectives and considers the changing external environment in which we operate. Our core values of Excellence, Care and Innovation are fully embedded within our culture and annual appraisal process; and drive performance improvements. The Board reviewed our Vision and Mission again this year, as part of our Business Plan and Corporate Objectives review, and have confirmed that these are still relevant and fit for purpose. Our Board Awayday in November focused on the future for Estuary and our response to the significantly changing operating environment. The impacts and potential implications of the summer budget 2015, voluntary Right to Buy agreement, ONS reclassification of the sector as Public Non-Financial Corporations. and the Comprehensive Spending Review were all discussed and considered. We have reviewed and/or created several strategies this year including our Customer Contact Strategy, Treasury Strategy and Stakeholder Communication Strategy. The Board have sought to ensure strategies are aligned and realistic and that they remain current and responsive to our operating environment, and to risks faced by the sector and the Association.
Whilst maintaining our development programme, we also made savings against our budgeted expenditure on net interest payable, in common with last year, as follows: Net Interest Payable 2015/16 Actual: £6,743,000 Budget: £7,462,000 Net Interest Payable 2014/15 Actual: £6,500,000 Budget: £7,399,000 Net Interest Payable 2013/14 Actual: £6,528,000 Budget: £7,148,000 This year we achieved a consolidated surplus of £8,467,000. £5,388,000 of this was attributable to FRS102 gains. Recent surpluses have been achieved as follows: 2014/15 of £4,775,446; 2013/14 of £2,869,574; and 2012/13 of £2,885,461. Our detailed comparative costs for the three year period are set out in our full VFM Self-assessment, which can be accessed via the hyperlink at the end of this section, on page 22.
Annual Report 2016 Page nineteen
Section ten Value for Money
Our corporate objectives are provided below. Some comments on how the return on our assets assists us in achieving these objectives are also noted below: 1. Putting Customers first 2. Investing in our communities 3. Achieving value for money 4. Growing the organisation 5. Valuing and supporting staff 6. Striving for sustainability The Association’s principal areas of investment are provided along with the rate of return achieved in 2015/16 and 2014/15 (in brackets). The Association is actively seeking to use its available financial capacity to meet housing need by investing in new housing. This reduces the overall rate of return on the portfolio as many new schemes which are good long term investments will often show a poorer return in their early years. The Association has opted to use a ‘historical cost’ valuation method under FRS102. However, the impact of our FRS102 Fair Value assessment of market rented assets, which are classified as investment assets, has resulted in a reduction on the rate of return of market rented properties. Revaluations have increased the value of properties held for market rent, whilst the surplus has only improved by the value of ‘depreciation saved’ under FRS102. The return on these units would be comparable to the previous year, had the valuation method not changed. The rate of return is also expected to improve as market rents increase, in future years.
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Accounting treatment of depreciation and grant have also impacted our Return on Assets. Depreciation is now calculated on gross assets, increasing depreciation costs by £864k. Grant is now amortised and released into income and this generated £1.93m additional revenue. The underlying impact is evident within our balance sheet, where asset values are growing whilst grant declines, changing the base upon which Return on Assets is calculated. Our Low Cost Home Ownership products and affordable rented homes in particular, help us to achieve our corporate objective of growing the organisation. Whilst the rate of return on low cost home ownership has decreased, the Board wish to continue to grow the organisation by developing further homes, to meet the growing housing need that exists in our region. Our social rent and supported living homes are focussed on the objective of investing in our communities, as these offer greater social value and assist in the pursuit of sustainable communities, which forms a part of our striving for sustainability objective. The income from our social rented homes also funds the routine and planned maintenance of our assets, allowing us to work towards further sustainability measures, in terms of retrofit works to reduce energy used. For example, planned works that resulted in improved sustainability to 577 of our properties, including 270 boilers replacements. This benefits the environment and also our residents via a reduction in their energy bills. As outlined throughout our VFM selfassessment, we constantly strive to deliver the best value for money throughout our services, ensuring we have the right supporting structures and developing and supporting our staff through various training programmes and policies. Further information on this area can be found in our detailed VFM Self-Assessment 2015/16, using the hyperlink at the end of this VFM section, on page 22.
Return on Assets: 2015/16 (2014/15) Social & Affordable Rent Investment net of grant
£204.8m (£154.3m)
Rate of Return including depreciation
4.8% (6.7%)
Rate of Return excluding depreciation
5.8% (7.3%)
Low Cost Home Ownership Investment net of grant
£16.5m (£11.8m)
Rate of Return including depreciation
5.2% (6.6%)
Rate of Return excluding depreciation
5.9% (7.0%)
Supported Living Investment net of grant
£7.4m (£7.8m)
Rate of Return including depreciation
10.4% (9.2%)
Rate of Return excluding depreciation
8.4% (8.6%)
Market rent Investment net of grant
£40.9m (£29.8m)
Rate of Return including depreciation
3.9% (4.1%)
Rate of Return excluding depreciation
3.9% (4.9%)
Annual Report 2016 Page twenty
Section ten Value for Money
Our average market rent letting time reduced to 23.7 days in 2015/16, from 43.9 days in 2014/15. Our strategy to drive down arrears, whilst causing a higher number of evictions and lettings during the previous year, has resulted in much improved performance. Market rent arrears were reduced from 2.45% in 2014/15 to 0.63% by the close of 2015/16. This has been achieved through fully embedded structures and core values, along with refined processes such as the use of guarantors, references, credit checking and 5 evictions on mandatory grounds. Our average letting time for standard general needs properties, including first-lets, was 20.93 days, an improvement upon last year’s 24.18 days. Excluding first-lets, our letting time was 28.75 days, an improvement of 12.77 days against the previous year. This represents the second highest improvement within our benchmarked London and Eastern Housemark Club, whilst placing us in the lower quartile. Overall satisfaction with our lettings process was 95.3%, with the remaining 4.7% neither satisfied nor dissatisfied. Our standard general needs void loss also improved to 0.58% in 2015/16, with actual rent loss of £114k benchmarking mid-upper quartile within our Housemark group (8th of 19). We are pleased to note that 100% of respondees were either satisfied or neutral in our lettings surveys, for the second year running, with 0% dissatisfaction. In separate surveys, 94.1% of residents in a new-build property were satisfied with our services in general, an improvement from 82.6% the previous year. Performance benchmarking information can be found in our detailed VFM Self-Assessment, accessible via the hyperlink at the end of this section, on page 22.
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Throughout the year we achieved 100% gas servicing certificate compliance, ensuring that all gas servicing was undertaken on time. Additional performance data can be found in our detailed VFM Self-Assessment using the hyperlink at the end of this VFM section, on page 22. The Board receives updates on performance against Business Plan financial assumptions, on a quarterly basis. Throughout the year our performance in generating additional income from conversions to affordable rent tenure was better than assumed. By the year end we had achieved 121% of the assumed conversion income, generating additional revenue of £102,800. All of this extra income was spent on the provision of a new supply of homes, meeting our organisational and business plan objectives of growing the organisation and investing in our communities. Our full Asset Investment Model (AIM) was utilised during the year. AIM is the latest step in our progress to “actively” manage our assets and is a key component in our value for money approach. It produces both Net Present Value (NPV) and Social criterion ranking, allowing us to assess poorly performing units for disposal under our rationalisation and development plans, as well as targeting those for capital investment. AIM is supported by our further Stock Condition Survey data, which became available to us in 2014/15 and has been added to throughout the year. A full picture of our AIM property ranking can be found in our detailed VFM Self-Assessment, accessible via the hyperlink at the end of this VFM section, on page 22. This year the Association has undertaken 1322 planned and major maintenance works to our stock assets, in comparison to 992 during 2014/15. We continue to use these opportunities to improve the quality of our stock and to deliver organisational aims, such as improving energy efficiency through the 270 new boilers and heating switch programme, to help us in striving for sustainability. Further information can be found in our detailed VFM Self-Assessment using the hyperlink at the end of this VFM section, on page 22.
GOVERNANCE, FINANCIAL VIABILITY AND VALUE FOR MONEY SELF-ASSESSMENT 2016 Supplement to the Estuary Corporate Annual Report 2016
Annual Report 2016 Page twenty-one
Section ten Value for Money
We are now four years into our rolling programme of investment in our supporting ICT Systems, including Customer Relationship Management, a project to streamline working processes, ensure consistency of service delivery with enhanced ‘right first time’ contact experience. This is key to our corporate objective of putting Customers first and to delivering our Customer Contact Strategy. We recognise that technology is an enabler of value for money in service delivery. We have continued to implement our ICT Roadmap, with further work undertaken on Customer Profiling, our Resident Web Portal with CRM integration, the procurement of an Electronic Document Management System to be rolled out during 16/17, the finalisation of access to our Assets and Liabilities Register via our staff intranet portal, the implementation and embedding of a procurement and stock control system for our ‘GEMS’ in-house estate services team and further improvements to our reporting functionality via CRM. Our procurement exercises ensure value for money has been achieved in this investment.
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The use of our Planned Maintenance System, Keystone, which was introduced during 2014/15, enables us to manage our assets in an increasingly sophisticated manner. This approach is supplemented by further stock condition survey data, our Asset Investment Model and the use of Mobile Working Devices for around 60 staff. These are some of the ICT initiatives that will help us to continuously improve upon our VFM achievements of 2015/16, which are listed more extensively in our Value for Money Self Assessment 2015-16, within our Governance & Financial Viability Supplement to the Annual Report. The full report can be viewed by following the hyperlink at the end of this section, on page 22. Some of these achievements are also listed in our Business Plan 2016-19.
Annual Report 2016 Page twenty-two
Section ten Value for Money
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Our comparative unit costs, for Housing Management and Maintenance are drawn from Housemark benchmarking services. At the time of preparing these statements 19 other organisations within our peer group are available to benchmark against 2015/16 data. Indicators are as follows: Function Major works and cyclical
Responsive Repairs & Voids
Housing Management
Total cost per property 15/16
£1,395.53
£867.79
£509.91
Bench marked 15/16 (of 19)
Middle-Upper (7th)
Middle-Lower (12th)
Middle-Lower (11th)
Total cost per property 14/15
£880.00
£737.00
£455.75
Bench marked 14/15 (of 13)
Upper (1st)
Upper (2nd)
Middle-upper (6th)
Total cost per property (13/14)
£592.32
£709.62
£384.61
Bench marked 13/14 (of 10)
Upper (1st)
Upper (3rd)
Upper (2nd)
Total cost per property (12/13)
£988.74
£693.51
£393.31
Bench marked 12/13 (of 16)
Middle-upper (7th)
Middle-upper (7th)
Middle lower (9th)
Total cost per property (11/12)
£812.23
£588.52
£407.86
Annual Report 2016 Page twenty-three
Section ten Value for Money
An area of continued focus throughout the year has been the performance and cost of our Repairs and Maintenance Contract. The 5 to 10 year agreement commenced in 2014 and during 2015/16 the Board have reviewed the performance of the contract from both a quality and value for money perspective, and agreed a clear direction for the future of this contract. Following gradual improvements in contract performance the Association will be moving to a new Price per Property agreement during 2016/17, in order to improve value for money and remove indexation linkages from the contract for a defined period. Efficiencies gained from this approach will ensure that our contractor is able to deliver a consistent service level for the remaining contract term. Expenditure on major and cyclical works increased during 2015/16. The increased total cost per property of major works and cyclical maintenance reflects the improved level of data from the results of the stock condition survey, which identified the requirement to carry out further backlog repairs. In addition, this increase also reflects the use of the “whole house” approach in packaging kitchen and bathroom renewals to improve efficiency through the combining of preliminary and overhead costs. Our increased Housing Management costs reflect the additional resources utilised to improve voids and rent arrears performance, and to address high levels of antisocial behaviour on some of our estates. Our residents have continued to assist us in formulating policy and undertaking scrutiny, via Resident involvement groups such as the Federation of Estuary Residents (FER) and our Scrutiny Committee, the Estuary Residents Service Review Panel (ERSRP). The Chair of ERSRP and four other residents are also Members of our Services Committee. Our customer-facing policies are discussed, amended and approved by FER, who have access to some of the Associations’ officers at every meeting. The Board are
10
proud that ERSRP were finalists in the ‘Customer Scrutiny Inspection Awards 2015’. We are committed to developing the skills of our involved residents and during the year residents attended a number of training courses; Understanding Social Housing; Introduction to Housing Law; Value for Money; and Equality Impact Assessment. During the year, ERSRP reviewed our Former Tenant Arrears Service, making recommendations which have been well received by the Association’s management team. The FER and ERSRP also put in place a joint Code of Conduct during the year. In 2015 the FER combined their AGM with a ‘Big Day Out’ for residents, increasing resident attendance and participation. Additional information on how residents have influenced the management of service delivery can be found in our detailed VFM Self-Assessment using the hyperlink at the end of this VFM section, on page 22. In terms of corporate environmental sustainability VFM, the Association made Green Savings of £19,407. £3,111 of these savings were in relation to car sharing for business travel and £3,757 of savings were made via the continued delivery of payslips by email, rather than in hard copy by post. £4,000 was also saved by providing our sales brochures, for affordable home ownership, on-line. We saved a further £8,539 by utlising computer screen energy saving features, through last year’s ICT system policy changes. To enhance our transparency, we include a ‘report an error’ field on every page of our website, so that people using our site can let us know if they have any problems accessing any of our documents or webpages, by clicking the button. We have also further improved our key word search facilities. This provides for improved accessibility, and therefore transparency, for our customers. We will be enhancing the layout of our Homepage during 16/17, in conjunction with the ERSRP, who will be scrutinising our communications.
Our detailed comparative costs for the three-year period and a full transparency statement are set out in our full Value for Money Self Assessment 2015-16 which can be accessed via our website, via the hyperlink estuary.co.uk/vfmsa1516
Annual Report 2016 Page twenty-four
!Chair - George Kieffer Joined the Board of Management in 2014. Area of expertise - Banking and Commercial background in both private and public sector.
!David Holmes BA (Hons), CIPFA, CIM
Quick facts
Joined the Board of Management in 2012.
Resignations from the Board
none
Number of full Board meeting held excluding AGM
Area of expertise Finance and Accounting.
Average attendance
6 79%
New Members
None
Female Members
2
Male Members
Section eleven Board Members
"Vice Chair - Paul Munday BSc, CDipAF, CEng, MICE
"Paul Durkin Joined the Board of Management in 2014.
Joined the Board of Management in 2009.
Area of expertise - Social Housing
Area of expertise Development, Civil Engineering and Accounting. VICE CHAIR
CHAIR
10
!Amanda Hughes BA (Hons) 1st Class, MBTI, CIPD Assoc, MBNLP.
#Ronald Horncastle ACIB Joined the Board of Management in 2007.
Joined the Board of Management in 2013.
Area of expertise - Banking.
Area of expertise - HR, Employment Law, Training and Development.
!Philip Garner BA, MIOD, MIC
!Peter Baiden Dip.App.Sc, PGCE
"Adetunji Oyewunmi BSc, ACA, ACCA
Joined the Board of Management in 2013.
Joined the Board of Management in 2010.
Joined the Board of Management in 2007.
Area of expertise - Business Development, Management Financial Controls and Relationship Management.
Peter has been an Estuary resident since 2009.
Area of expertise - Finance.
Expressions of interest in becoming a Board Member should be made on 0300 304 5000 or by email to info@estuary.co.uk All members are elected and paid a modest honorarium. Resident Board Members work on a voluntary basis.
Member of the Federation of Estuary Residents until January 2014.
Member of the Board Development Committee
11
!Stacey Brewer BA (Hons)
"Mark Gaynor MA, BA, Dip.
!Paul Kingstoc MA, FCIH, MCMI
Joined the Board of Management in 2011.
Joined the Board of Management in 2009.
Joined the Board of Management in 2012.
Area of expertise - Housing Policy, Performance and Communications.
Area of expertise - Town and Country Planning, Housing and Regeneration.
Area of expertise - Social Housing Sector. CHAIR
Services Committee Investment, Audit & Risk Committee Corporate Health and Remuneration Sub-Committee
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Annual Report 2016 Page twenty-five
Section twelve How we run our business
1 April 2015 - 31 March 2016 Estuary is totally committed to giving stakeholders the opportunity for involvement in decision-making. We welcome comments, complaints and suggestions for improvements and respond to these positively. The Board of Management recognises that good governance is integral to the delivery of quality services and has ensured that we comply with the National Housing Federation’s Code of Governance. Compliments 103 compliments were received during 2015/16. Complaints figures 667 complaints were received during 2015/16. 697 complaints closed 537 complaints upheld 0 progressed to Housing Ombudsman
“I reported to estuary that someone had dumped house hold furniture items on our estate. This was dealt with very quickly and the communal grounds look great once again. Thank you.”
I can’t thank you enough for doing all you have to resolve the issue.”
“The lady on the phone was very polite and extremely helpful. Well done for providing this excellent service.”
Responsive maintenance Total number of repairs undertaken 2014/15 - 11,763 2015/16 - 11,189 Voids When a resident leaves a property we take time to make sure that it meets our high standards before it is made available to new residents. Total number of 132 voids 2014/15 Total number of 157 voids 2015/16
“Mr O phoned to express his delight with the contractor who carried out the work on the boiler.”
“I would like to praise the gardeners and cleaners at Colvern House, Romford who visit regularly for a morning each week. They do a fantastic job and Work extremely hard in the time they have. Well done.”
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Annual Report 2016 Page twenty-six
Average performance achieved across the year
Target
Performance 2015/16
Section twelve How we run our business
94%
Repairs - emergency
95%
85%
Repairs - urgent
95%
94%
Repairs - routine
95%
4.7%
General needs rent arrears
4.5%
21%
Re-Let times
20%
89%
Tenant satisfaction with repairs service
90%
Annual Report 2016 Page twenty-seven
Section twelve How we run our business
Programme of works
Homes
Cost
642
£513,094.36
98
£347,344.77
Replacement of bathrooms, including additional wc’s
107
£327,175.73
Replacement of windows and doors, including communal entrance and exit doors to blocks
148
£638,797.77
9 blocks, consisting of 80 homes
£28,217.84
1
£11,182.56
Electrical inspections and full rewires
44
£140,136.04
Heating switch programme from electric storage heating systems to new air source heat pump heating systems
10
£88,799.40
104
£37,350.50
External and communal area redecorations Replacement of kitchens
Replacement of block secure entry systems Replacement of roof coverings
Loft insulation top-ups Other Major Projects, including balcony balustrade replacements to Carousel Steps on the Woodgrange Drive Estate
12
£211,133.35
Annual Report 2016 Page twenty-eight
Section eleven How we run our business
12
General needs lettings April 2015 - March 2016
Total
Assured
Fixed term
Barking & Dagenham
6
1
5
Basildon
2
1
1
Braintree
0
0
0
Brentwood
7
3
4
Castle Point
1
1
0
Chelmsford
1
0
1
Colchester
13
8
5
Epping Forest
6
3
3
Harlow
0
0
0
Havering
84
17
67
Maldon
8
1
7
Redbridge
1
1
0
Rochford
0
0
0
Southend
73
20
53
Tendring
2
0
2
Thurrock
17
6
11
Uttlesford
13
8
5
Total/average
234
70
164
Annual Report 2016 Page twenty-nine
Section thirteen Average rents per local authority area
13
Average general needs net rent 31 March 2016
Average supported housing net rent 31 March 2016
Basildon
100.25
124.44
Braintree
111.36
N/A
Brentwood
128.80
90.50
Castle Point
102.44
119.26
Chelmsford
129.77
115.40
Colchester
100.49
111.97
Epping Forest
121.78
N/A
Harlow
N/A
112.21
London Borough of Barking & Dagenham
104.34
N/A
London Borough of Havering
117.46
109.80
London Borough of Redbridge
128.85
N/A
Maldon
96.73
N/A
Rochford
111.24
94.10
Southend on Sea
92.14
96.05
Tendring
107.46
N/A
Thurrock
97.67
108.62
Uttlesford
108.17
101.03
Average rent per week (general needs) -
101.71
101.76
Annual Report 2016 Page thirty
Balance Sheets at 31 March
2016 £000s
2015 £000s
367,716
351,380
Other fixed assets
1,395
1,175
Homebuy loans receivables
2,040
2,113
Investment in subsidiaries
2,500
-
373,651
354,668
Properties held for sale
3,389
4,265
Trade and other debtors (money owed to us)
2,927
2,883
29,768
19,334
(18,416)
(13,996)
17,668
12,486
391,319
367,154
Loans
195,627
181,749
Social housing grants
147,081
145,835
3,000
2,426
45,611
37,144
391,319
367,154
2016 £000s
2015 £000s
Income from rents, service charges, care provision, properties developed for sale and grants etc
38,890
35,543
Cost of properties developed for sale
(3,851)
(1,893)
(25,430)
(21,868)
9,609
11,782
Surplus on selling properties not developed for sale
986
745
Interest received on cash invested
114
24
(6,857)
(6,720)
304
(2,530)
Movement in fair value of investment properties
4,311
3,429
Surplus for the year
8,467
6,730
Properties
Fixed Assets
Section fourteen Financial Performance
Figures in brackets indicate negative values. Includes 2015 restated position under FRS102. A full set of audited accounts are available from: Estuary Housing Association Limited, Maitland House, 8th & 9th Floors, Warrior Square, Southend-on-Sea, Essex, SS1 2JY
Cash and cash equivalents Creditors (money we owe others) Net current assets Total assets Financed by
Other long term liabilities Reserves Total financing Statement of Comprehensive Income for the year ended 31 March
Operating costs Operating surplus
14
Interest and financing cost Movement in fair value of financial instruments
Useful information Registered Office 8th and 9th floors Maitland House Warrior Square Southend-on-Sea SS1 2JY
Internal Auditors Mazars Tower Bridge House St Katharine’s Way London E1W 1DD Principal Solicitors Devonshires Solicitors 30 Finsbury Circus London EC2M 7DT
tel: 0300 304 5000 fax: 01702 616716 Housing Management Office and Family Centre Centre Place Prospect Close Southend-on-Sea Essex SS1 2JD fax: 01702 611502
Estuary is a housing association with charitable status. VAT No. 100 1210 18
Principal Bankers National Westminster Bank Plc 132 High Street Southend-on-Sea Essex SS1 1BA Auditors Grant Thornton UK LLP 80 Compair Crescent Ipswich Suffolk IP2 0EH
If you would like this document in another language, large print, Braille or audio or if you require the service of an interpreter, please contact us on 0300 304 5000.
HCA – Homes & Communities Agency – Register 3535 Estuary Housing Association is a registered society under the Co-operative and Community Benefit Society Act 2014 – No. 23240R Web address: www.estuary.co.uk
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