The Governor by HQN Limited

HQN The Governor Jun 2012 04/06/2012 12:03 Page 1

Governor the

HQN's magaziNE for boards, ExEcUtivEs aNd lEadErs

JUNE 2012

From Bettys Harrogate cakes to Betty’s coronation street Hotpot AS THE BIG CONFERENCE MOVES, WHAT ELSE IS CHANGING IN HOUSING?

Grainia Long interview Regulation Outsourcing – the time is now? Governance round-up

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Just another ‘usual suspect’ or a real alternative? Recruiting the right people is never straightforward and can be costly if you get it wrong. Now you have a genuine, specialist, alternative when you need support with senior appointments. Urbica is led by Bill Barkworth, who has over 20 years’ experience in executive and non-executive search and selection. In the last three years alone, Bill has successfully managed the appointment of: Over 25 chief executives Over 35 chairs and non-executive board members

Forty-plus executive directors in the housing industry, across housing associations, ALMOs, local government, central government, the housing regulators and tenant organisations.

He also has extensive experience of recruiting in the regeneration, construction and development sectors. Urbica has the expertise to provide a thorough, high quality approach to recruitment that delivers results. From advice in scoping your role, assessing the skills needed through the executive search to the final offer, we support you every inch of the way – and beyond. With Bill’s background, proven track record, and networks we can offer much more than just the usual approach to recruitment. The hallmark of our success is Bill’s style: a real focus on getting the right person for you through a personal, hands-on involvement, and an approach which is informed, thorough, professional and trusted by clients. Bill is an accredited level A & B psychometric assessor with the British Psychological Society and is a member of the CIH. Urbica can provide any or all of the following: Search, selection and assessment

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Urbica is part of HQN. For further details and a confidential discussion, please contact Dave Ganz, Executive Director, on 07921 308823 or by emailing david.ganz@hqnetwork.co.uk or Bill Barkworth on 07706 369273 or by emailing bill.barkworth@hqnetwork.co.uk Rockingham House St Maurice’s Road York YO31 7JA

Telephone 0845 4747 004 Fax 0845 4747 006

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Internet www.hqnetwork.co.uk Email support@hqnetwork.co.uk

Bill Barkworth

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Social housing is a soaraway success. Last year associations made as much money as Ryanair and Marks and Spencer put together. That’s right – associations cleared a cool one billion pounds.1 Well done to the management that delivered these results in a tough climate. There is now a tussle over how the money gets spent. The government has got its beady eyes on the cash. Build more homes for less public money is the cry. But another government policy gets in the way. Welfare reform will slash the income of residents and landlords. HQN is working with five landlords in the North and Midlands – a mixture of associations, councils and ALMOs. Working-age tenants will get Housing Benefit based on how many bedrooms they need. They lose cash if the government thinks they have too much space. Not all the landlords can move residents to smaller homes. This bedroom tax could cost these associations between half a million to three million pounds every year. That blows a hole in the business plans.

2011 global accounts of housing providers: www.tenantservicesauthority.org/server/show/conWebdoc.21847

Universal Credit replaces Housing Benefit for working-age tenants. It goes direct to the tenant, not the landlord. Across our five landlords 60% to 80% of their rent roll comes to them direct from HB today. Collection will be tougher in the future. These landlords are doing all they can to tell tenants about the changes, move people to smaller homes, give benefits and budgeting advice, and help tenants into work. One of the biggest areas of activity for HQN this year is about supporting our members through welfare reform. With all the financial challenges our members keep pushing on VfM. In some sectors traditional outsourcing is the answer. After the Connaught and Rok fiasco in maintenance, housing is going down different roads. Maintenance teams are coming in house or becoming joint ventures. On top of all the other benefits this saves VAT. Tendering out blue collar housing work is routine. So far white collar tenders are rare. Will this change? This issue of The Governor looks at how Plus Dane secured the contract to manage council housing in Cheshire. If this works out well on the ground we could see more tendering. Elsewhere we have worked at associations and councils where HQN tests the quality of housing management and a private contractor offers an indicative commercial price. We look at quality and cost on site. So you get away from the ‘apples and pears’ excuse that bedevils benchmarking. Our member gets an insight into commercial methods without spending a year or more on procurement. Straight away they can implement any of the private sector recommendations that make sense. You don’t need to go through the palaver of tendering and disruption of switching managers. Shepherds Bush Housing Group talks about how this worked for them on page 12. As I go round the country I am more and more impressed with the resilience and ingenuity of our members. The government is stripping cash out of the sector right, left and centre. But somehow you keep going. Alistair McIntosh Chief Executive, HQN

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Social housing – a soaraway success Comment by HQN Chief Executive Alistair McIntosh

Blurring boundaries The face of the housing sector is changing. Do we know who we are any more?

North/south divide The way in which social housing is regulated north and south of the border is now very different

DYB, DYB, DYB… Are you prepared for the new regulatory regime?

Bulletproof…? The woman at the top of the CIH explains why she thinks strong and effective boards are the key to the sector’s success

Counting shepherds SBHG put through its paces against the private sector

Going back to his roots Plus Dane’s Ken Perry on his mission to transform the service which housed him and his family and launched his career

Equality rules What does it take to become a leading gay-friendly employer? From the press Our regular round-up for the world press’s view of governance

Risky business The more women on boards – the riskier the decision-making? Two-way street More housing organisations are benefitting from mentoring others Swap shop Stock swaps are becoming ever more popular Youth speak Housing group sets up youth ‘shadow’ board

All articles in The Governor were written by Kate murray unless otherwise stated. designed by Paul miller Print management

Prontaprint scarborough

Jeannie swales

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Take a look into the future at two housing managers. Both are managing significant property portfolios. But one is building new homes funded by private investors through a whizzy new funding model and renting out apartments to decent earners who would never qualify for a social home. The other is managing inner-city council homes at a social rent. Which one works for a housing association and which one for the private sector? And as the boundaries between what once were very different types of housing organisation blur, apart from the logo on the door, will we even be able to tell any more? The divides between different types of providers have been coming down for some time now. Housing associations have had to adapt and evolve ever since the introduction of private finance introduced new commercial drivers into the way they were operated. Stock transfers, the introduction of ALMOs and the success of some private sector housing managers have also played their part in changing the face of the social housing sector. But the pace of change is now accelerating. That’s due in large part to the constraints on public spending and the need for social landlords to be ever more creative in looking for funds to continue to develop new homes.

It’s due too to the desire of government to encourage new providers to offer new routes to deliver new homes. And then there’s the product itself: with the affordable housing regime producing homes at higher than social rents, and the private sector growing, the differentiation between alternative forms of provision is become less defined too. So what will come to define social housing in this brave new world? It won’t be an organisational structure, and it won’t be a product: there will be increasing diversity on both counts. There are dangers in all of this: concerns have been raised that with the move away from the ‘traditional’ model of what a social housing provider looks like, we could see growth for growth’s sake, increased risks and a weakened focus on residents and communities. But there are opportunities too. For many providers the need think hard about how they will take their organisations forward in an increasingly competitive and tough environment will allow them to focus on what really matters: their social purpose. For boards and execs then the key question may no longer be what will our organisation look like in five years’ time, but what will be the social purpose at its core?

the face of the housing sector is changing. Do we know who we are any more?

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NEW HorizoNs: HoW tHE boUNdariEs arE blUrriNg THE REIT OPTION ten housing associations across south east England are expected to be involved in a large-scale real estate investment trust due to launch later this year. the rEIt being developed by law firm Winkworth Sherwood is an aggregated one, designed to bring in £500m of private sector investment to the social housing sector. the model, says Winkworth Sherwood, allows associations to adopt a rEIt on their own terms, rather than ‘being compulsorily rEIted’ – a spectre some have seen in the government’s consultation on rEIts.

the radical nature of the plans is something its backers acknowledge head on. As Keith Jenkins, senior partner at the firm, said when the rEIt was announced: “We are well aware that commentators will accuse housing associations of selling off the family silver or taking one further step towards the privatisation of social housing. We do not believe this is the case at all – this product allows housing associations to join with private investors to create more social housing. the introduction of shareholders will also make landlords more accountable.”

COMPETITIVE SPIRIT? THE NEW KIDS ON THE BLOCK the opening up of the affordable housing market to private sector players is now a reality. orchard & Shipman, Pinnacle and Shanly Homes were all registered with the tenant Services Authority just before it handed over its regulatory role to the Homes and Communities Agency. In total there are now nine registered for-profit landlords. For the new entrants, it looks set to be a period of rapid growth. orchard & Shipman has talked of a ‘robust

strategy’ to deliver homes in the first year of operation of its registered provider orchard & Shipman Homes. It is looking to provide homes both through new development and by buying existing homes. Pinnacle too says it will become an active provider through its registered subsidiary Pinnacle Spaces, ‘using innovative financing models it plans to deliver new housing supply through acquisitions and regeneration’.

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NortH/soUtH the way housing is regulated is now very different north and south of the border So which of the new frameworks has the edge? And what can English and Scottish providers learn from each other?

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If there’s one area of housing providers’ business both north and south of the border that’s seen the most rapid change in the past few years, it’s regulation. In England, the Tenant Services Authority was launched to a great fanfare – and then scrapped. The Audit Commission and housing inspections have also gone, replaced with a framework rooted in scrutiny at a local level. In Scotland a new body, the Scottish Housing Regulator has emerged, putting tenants at the heart of its approach to regulating the housing sector. Its continued focus on consumer regulation is very different from that in England, where the Homes and Communities Agency’s regulatory arm will only act as a ‘backstop’ when service failures are so grave as to risk potential harm to tenants. For many working in English organisations, there’s some degree of uncertainty over what will be expected of them under the new regulatory regime (see survey results, overleaf ). But one thing is for sure: the new set-up, with its focus on economic regulation, is very different from what’s gone before. Organisations with a presence in both countries see the different emphasis very clearly. As Steve Thompson, company secretary at the Home Group, puts it: “In Scotland they are now at the place where England was a while back on terms of the focus on the consumer side. In England, the big thing has been the whole philosophy of co-regulation that has really taken root and put the onus fairly and squarely on boards to ensure they comply with standards. We have moved away from ‘one size fits all’ regulation on fairly narrow tramlines to something broader where we work with our customers and clients to work out what is best.” Home is working on a group-wide approach to self-evaluation, taking where possible the higher requirement from the two countries and working to adopt consistent policies where it can. Too much leeway? But some argue that the changes in England leave too much leeway to mediocre providers to allow their services to residents to slide. Roger Jarman, formerly Head of Housing at the Audit Commission and now a

housing consultant, is, not surprisingly given his background, concerned about the new approach. “The Scottish system is more akin to what we had in England before the coalition government. There’s evidence that that system was delivering dividends,” he says. “I am very wary about the new approach in England – because there’s effectively no monitoring on anything at the central level, we are going to see organisations taking their eye off the ball. You are always going to get the best continuing to deliver very high quality services and you are always going to get basket cases: but it’s the coasters that are now a worry.” Mr Jarman, who recently wrote a paper for HQN comparing the two regimes, fears leaving so much on the consumer side to the local level could mean tenants lose out. He points to organisations like Moat, which recently advertised for an independent chair for its residents’ scrutiny panel, as an example of a positive approach, but warns: “You are going to get individual organisations working very differently with tenants. I think most organisations make some sort of effort, but if you haven’t got some sort of cajoling at national level and checking at national level, you can’t tell. Will organisations be paying lip service to scrutiny? Will it really deliver challenge on the ground?” The lighter touch But Riverside Chief Executive Carol Matthews, whose housing association group includes members on both sides of the border, takes a different view. She says her personal opinion, as a Scot working in England, is that English housing providers are ready to rise to the challenge of a lighter touch regime. “There’s a real opportunity with co-regulation for associations to demonstrate we don’t need regulating for the contract between us and our tenants. Light touch co-regulation demonstrates the maturity in the relationship between us and our customers,” she says. “Look at Tesco and Sainsbury’s – they don’t need a regulator to tell them how to deal with their customers.”

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NortH/soUtH

DiviDe

She says because of the roots of Scottish housing providers – largely smaller, community-based organisations – it is not surprising that a consumer focus is so central to the regulatory approach there. In England, with its increasing reliance over the years on private finance and growth, there has been a bigger emphasis on risk and viability. But, says Ms Matthews, the pressures in Scotland, with decreasing grant and a lower rent environment, means the challenges in both countries are now ever more similar. “I worry that the regulator in Scotland is being asked to do too many things,” she says. “They are being asked to spread themselves across consumer regulation, governance and viability. The worry is that the consumer side will absorb a lot of the regulator’s time; time that should be going into governance, viability and risk. The English regulator has a clearer mandate and focus.” Ms Matthews adds that the safeguards in place for consumers in England in the form of the Housing Ombudsman are bolstered by the scrutiny of other stakeholders including the banks and rating agencies as well as MPs and councillors. “My view is that regulation should be about governance and viability and value for money. The consumer side should be about boards and executives taking the lead,” she says. At Riverside, a group which includes Irvine Housing Association in Scotland, good practice on performance is shared in both directions across the border. Riverside’s residents, Ms Matthews says, are very involved in challenging performance and driving improvement. Jury’s out… So how will the different approaches to regulation in the two countries pan out? Has the Scottish Regulator got too wide a remit? Or is it English tenants who will lose out with little national oversight on the consumer side? The jury is still out. But one thing is clear: housing providers on both sides of the border need to be more focused and well-run than ever before as they attempt to do more for less. As Ms Matthews puts it: “We used to be charities that did a bit of business. Now we are businesses with a charitable heart.” All change! An evaluation of the new frameworks for regulating social housing in England and Scotland, by Roger Jarman: http://www.hqnetwork.co.uk/document.php?id=8356

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DyB, How well prepared were English housing providers for the new regulatory regime? The signals are mixed If ministers were hoping for a wave of positivity after their decision to turn the tenant Services Authority into toast, they are in for a bit of a shock. For, according to the results of HQN’s survey of English housing providers, the changes to regulation have been greeted across the country with a mixture of concern, only partial optimism – and sometimes downright bafflement. the better news first. Almost half of providers felt the new regime was a great opportunity and that landlords would rise to the challenge. more than two-thirds felt they knew what to do to meet the focus on value for money in the new regulatory framework. Serious detriment – what does it mean? But there’s clearly still widespread uncertainty across the sector about the new regime, which came into

“good laNdlords Will coNtiNUE to raisE tHE bar WHilst coastErs Will UsE tHE ExcUsE to cUt sErvicEs back”

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DyB,DyB... force in April. Only just over a third of organisations felt that their board members or councillors understood the framework, with 22% saying they still had a long way to go and 44% reporting that it was too early to say. Only 37% said that they understood the consumer standards – under which the regulator will only act if there is potential ‘serious detriment’ to tenants. A worrying 18% did not understand what serious detriment meant, while a further 45% were not sure. The concerns in this area were summed up by one respondent’s comment: “The term 'serious detriment' may become open to interpretation, the workload on boards and councillors will increase and sector benchmarking will be more difficult as each provider will determine their own standards.” But perhaps the most troubling finding is that only one in five felt the new framework would improve services, compared with 26% who felt services would deteriorate under the new regime. Some 44% felt the regime was a threat to the sector, because without a strong regulator standards would fall. As one respondent put it: “Good landlords will continue to raise the bar whilst the coasters and poorer landlords will use the excuse of value for money to cut services back.”

Recruiting and retaining Many housing providers have a strong track record on tenant involvement and the survey showed that the new arrangements, giving tenants a key role in scrutinising their performance, had enthused many landlords. But it also highlighted the ongoing problem of finding the right tenants to get involved. As one respondent commented: “It is a challenge recruiting and retaining scrutiny members who are able to commit the time. This undermines the value of their contribution.” So what now for housing providers as they move forward under the new regime? It’s clear that there’s still a huge job of work to be done bringing some board members and councillors up to speed. They need to take a strong lead on making the new framework work effectively for their tenants and their organisation. There will need to be a strong focus in the months to come on ensuring tenant scrutiny models put in place are working effectively. There are grounds for optimism in the welcome given by many to the new flexibility the framework gives them to adapt their organisations to local circumstances. But, if standards are not to fall across the sector, there is no room for complacency. A full HQN briefing on the survey results is available at: http://www.hqnetwork.org.uk

some key finDings

Will tenants see better services under the new framework?

Do your board or councillors understand the new framework?

Yes, services will get better –19%

Yes, they have a good grasp – 34%

No, services will deteriorate – 26%

No, we have a long way to go – 22%

Full details at www.hqnetwork.org.uk

Not sure/too early to say – 55%

Not sure, we are still making sense of the changes – 44%

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When the going gets tough, the tough get going. The woman at the top of the CIH explains why she thinks strong and effective boards hold the key to the housing sector’s success

BULLet It may be tough out there but Grainia Long is not letting it get her down. Far from bemoaning the diﬃcult times faced by housing providers, the Chief Executive of the Chartered Institute of Housing is determined to help them rise to the challenges ahead.

“I’m an optimist,” she says. “I think the sector is extremely well placed. I think we do need to exploit our capacity better. We do need to be more strategic as a profession and clearer about what our role is, positioning ourselves and demonstrating the economic outputs of housing. Housing is an incredible growth lever and there is an incredible amount we can do and do do.” ms Long, who took over as permanent Chief Executive of the institute in February after a stint as its interim head, has clear priorities for the next few years. And supporting housing leaders to steer their organisations into the future is one of them. A silver bullet “Governance is a silver bullet. You can tell how ambitious an organisation is and how likely it is to succeed by how it is structured and who is on the board,” she says. “We are beginning to see the impact that the

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professionalisation of boards can have, bringing in a new set of skills. that has helped organisations to be more self-aware, more aware of the external environment and to get the right balance between risk and return.” For ms Long, there is no single model for social landlords to follow as they try to respond to the pressures to do more for less public funding. Some, she says, may choose to continue with the model which has been successful for them for many years, while others are ‘moving well beyond’, looking for new ways of funding development and innovative ways of growing their organisations. that diversity of approach, she insists, is key to the sector’s strength. But whatever their chosen strategy, boards and senior executives must ensure they are at least having the right conversations. “So long as an organisation is self-aware and takes a conscious decision, asking ‘Are we in a position to innovate? Do we have the capacity to innovate?’, then that’s ﬁne,” she says. “Where it would be a concern is where an organisation was not having that discussion. Everyone should be having those conversations about what the impact is of the outside world, what impact the new growth ﬁgures will have on the economy,

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“govErNaNcE is a silvEr bUllEt. YoU caN tEll HoW ambitioUs aN orgaNisatioN is bY HoW it is strUctUrEd aNd WHo is oN tHE board” grainia Long CIH Chief Executive

Proof..? Proof. ..? how that will impact on the sector and how that will impact on their organisation.” Asking the right questions The best boards she says, ‘ask the right questions and get the balance right between challenge and scrutiny’. The CIH is working on helping boards keep on top of that game, and to get to grips with the new regulatory framework with its focus on governance and viability. “When you get governance right, everything else flows from that,” says Ms Long. “Organisations are going to have to have arrangements that are fit for the future. The new framework does give boards immense freedom and allows them to innovate. But with that comes a responsibility to ensure that as a board they are constantly questioning and understanding the level of performance expected of their organisation.” As part of its focus on governance, the CIH is also developing a new business model for executive pay in the housing sector. That’s a timely project, given the focus from politicians, particularly housing minister Grant Shapps, on pay levels at the top in housing associations.

Ahead of the curve

“It’s really about getting ahead of the curve and making sure organisations do have transparency in place,” says Ms Long. “Remuneration committees should have a holistic view that sees pay in the context of the business strategy and of local society. They are different organisations from financial institutions and remuneration will have to reflect the sector and its social values.” As for the CIH itself, the new Chief Exec hopes to build on its own governance changes, which have seen a new board structure introduced, with more routes for members into its decision-making. Ms Long says that, despite the real low of the death of the last Chief Executive Sarah Webb last year, the organisation is now well placed to develop in the years to come. “One great thing about running an organisation like the CIH is that you have 20,000 members alongside you and I see that as a real positive,” she says. “I want to have noisy and active members. That’s how we grow and go forward as a sector. Housing is changing rapidly and our members are rightly looking to us and saying: ‘What will the future look like?’ We need to have those answers.”

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If there’s one question that’s likely to keep chief executives and board members awake at night, it’s this one: “How do you put a price on quality?” Social landlords are facing an ever-increasing pressure to bear down on costs and demonstrate value for money, yet drive up the quality of services to residents. that challenge – of ensuring the best use of resources, without sacrificing the quality which residents rightly demand – is set to dominate the agenda for providers in the austere economic times ahead. For one housing association, the challenge has provoked a bold response. Shepherds Bush Housing Group, a medium-sized association based in west London, decided to take a long hard look at its costs and performance compared with the private sector in the form of housing management contractor Pinnacle. the exercise, the first of its kind, involved HQN carrying out an inspection of the group’s services and Pinnacle submitting a mock tender – allowing for an in-depth comparison of private sector and housing association costs and services. the idea was not to prepare the ground for outsourcing – Pinnacle pledged not to bid if such an outsourcing plan ever became a reality – but rather to help SBHG as it works to deliver better value for money. Track record Pinnacle, which has a track record of winning housing management contracts in places including Westminster, Lewisham and Woking, submitted its bid on the basis of providing at least a two-star service to match the service level HQN found at SBHG. It came in cheaper

coUnting 12

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on price than SBHG’s current management costs. Its price reflected the fact that it would, for example, share back office functions with other contract teams and reduce office costs and overheads. Pinnacle would save around 20% over a five year period. But that doesn’t take into account a number of extra – and significant – costs involved in setting up and monitoring a contract and VAT. Factor in the time taken to procure a contract and then to deliver any savings, and HQN would not recommend outsourcing for SBHG. Instead the evaluation team suggested that the group continue its work on cost savings, while maintaining service quality. SBHG Chief Executive Paul Doe says the process has been an interesting one. “We are on a journey to ensure we offer better value for money. We are not in the position where we have done nothing – but we are not in the position where we have done everything,” he says. “People said this was brave – but I saw it as an opportunity to take another step. We wanted to see firstly what the private sector could offer if they operated in our environment, and secondly how far we had got on our value for money journey.” Two, possibly three, stars As Mr Doe points out, Shepherd Bush’s services – rated at ‘at least’ the old two star (and possibly three star) standard by HQN in this exercise – have evolved to meet resident’s needs and in response to the local environment. The organisation has been determined to invest in ‘added value services’ and, like many, it has also invested in quality to meet the demands of the old

inspection regime. In SBHG’s case, this involved moving from old, cramped offices – which inspectors said had ‘screamed one star’ – to better premises. The association has also made a priority of investing in good quality IT and HR and has achieved Gold Investor in People Champion standard.

“WE arE Not iN tHE PositioN WHErE WE HavE doNE NotHiNg – bUt WE arE Not iN tHE PositioN WHErE WE HavE doNE EvErYtHiNg”

“We have high quality back room services which are probably more expensive than most organisations of our size,” says Mr Doe. “But we can now move on from there. With the central services and offices, we have taken a step up and can now grow and build. Once we do that, we suddenly won’t look any more expensive.” A welcome challenge The new regulatory framework urges organisations to look at alternative delivery models as part of the focus on value for money. And for SBHG, the challenge inherent in the comparison process was a welcome one, adds Mr Doe, particularly now that external inspection has gone. “You do need to be challenged and the fact is that the Audit Commission did challenge. But who is asking those questions any more?” he says. “We didn’t go into this exercise thinking of outsourcing. We did it to challenge our own organisation, so that we can take the next steps.” Those next steps will involve driving up quality, while looking for opportunities to grow. “For us it is not just about saving money,” says Mr Doe. “It’s about getting more for what we put in.”

sHepHerDs A housing association has challenged itself to continue its value for money ‘journey’ by putting itself up against the private sector

NEW

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going Back to His For Ken Perry, securing a £100m contract to run a local authority’s housing service was not just good business. It also marked an emotional return to his roots

NEW

ALLIANCES

Mr Perry started his career in housing as a YTS trainee at the old Ellesmere Port and Neston Borough Council. Thirty years on, and now Chief Executive of Plus Dane Group, he’s been able to go back to the town with a mission to transform the housing service which housed him and his family and launched him on his career.

homes in a competitive process which involved, he says, plenty of ‘high quality’ bids. The housing service, now owned by Cheshire West and Chester Council, had faced tough times in recent times, after a mock inspection three years ago found it was a poor service with poor prospects for improvement.

“Apart from giving me a decent house, they gave me education, training and support and lit the spark that is still burning in me today,” he says. “To be able to come back with 600 of your mates who all share your passion is quite a moving experience, as well as the intellectual challenge that’s there. I couldn’t be more excited.”

But, says Mr Perry, huge efforts since, including from existing staff and an interim management team from HQN, have put the service back on the right path. “The service has taken massive strides forward – it is not anything like as bad as it was two years ago,” he says. “I have been very impressed with the competence and commitment of staff. It feels like all the ingredients are there. What we will be doing is taking things onto the next level.”

Trailblazing It’s an interesting deal in other respects too: perhaps a trailblazer for more housing association involvement in running local authority homes – and in areas beyond those which were early adopters of outsourcing housing management. It also chimes, says Mr Perry, with national priorities. “It is at the front end of the things being talked about by the government when it’s looking at outsourcing, about people being more engaged and taking more responsibility,” he says. Plus Dane was chosen to take on the management, repairs and maintenance of the area’s 5,800 council

Neighbourhood investment Mr Perry says Plus Dane, which calls itself a ‘neighbourhood investor’, will bring its own three-strand approach to the service, focusing on homes, neighbourhoods and enterprise. It will look to maximise the value of every pound spent, to boost the local economy as well as maintain the stock and build new homes. It already works with a ‘coalition of willing partners’ across the business to ensure investment is well spent. “We have got a track record of bringing together a diverse group of people around a common purpose,” says Mr Perry. “What the council has decided on in us is

pLUs Dane anD eLLesmere port anD neston Plus Dane already manages almost 13,000 homes in merseyside and Cheshire

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Its deal with Cheshire West and Chester Council is a five-year, £100m, contract. But Plus Dane’s vision, says Ken Perry, is to become a ‘part of the fabric’

Some 200 council staff will transfer across to Plus Dane, with no compulsory redundancies.

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roots not just a competent landlord service but a close match between what we are able to do to help, and their agenda for the regeneration of Ellesmere Port.” But what about existing tenants of the group? mr Perry says they had to be happy with Plus Dane going for the contract before it bid, so a robust business case was needed. He explains that for residents, the benefits come both in learning from another organisation and in the greater efficiency it can bring across the group, allowing for more spending on what matters most to them. After the formation of Plus Dane out of the merger of Cheshire-based Dane and merseyside-based Plus Housing Group, the organisation concentrated on bringing down the costs of running the business so as to be able to spend more on the frontline. Between £5m and £6m extra every year now goes into neighbourhoods as a result of efficiencies such as rationalising the senior team and improving procurement. “that was the essence of our business case,” mr Perry explains. “We know that we can further reduce our running costs so we can generate more for actually doing.” Whether Plus Dane’s contract heralds a new generation of outsourcing deals remains to be seen, says mr Perry. “there is certainly a market there in terms of organisations wanting to provide a service,” he claims. “the challenge is whether local authorities want to do it and whether the political will is there.”

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eQUaLity rUlEs What does it take to become a leading gay-friendly employer? And what are the business benefits?

The housing sector prides itself on its commitment to diversity. And rightly so: providers dedicated to tackling inequality recognise the need to embed positive policies to promote inclusion in all they do. But it’s not just about fairness. Increasingly, the business benefits of diversity are being appreciated too.

In the field of lesbian, gay and bisexual rights, a number of housing providers are now putting their commitment to inclusiveness to the test by going for LGB charity Stonewall’s Employer of the Year awards. For Stonewall,

from tHE press People in deprived areas have real trouble ‘stepping over the threshold’ into official buildings, according to an article posted on the openDemocracy website. The article, on Thinking outside the building, suggests people’s bad experiences with schools and services such as benefit offices could be to blame. It claims services could get a much higher take-up if they were taken outside an official setting, citing examples of GP surgeries and arts and crafts activities which have successfully

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the benefits of taking the issue seriously are clear: “LGB people are increasingly choosing to take their skills, energy and talent to workplaces where they are more than just ‘tolerated’,” the charity says. “Groundbreaking Stonewall research has shown that LGB people who can be open about their sexual orientation at work are more productive, creative and loyal.” Housing providers made a strong showing in this year’s list, with Gentoo, Genesis, Plus Dane, South Essex Homes, Your Homes Newcastle and Berneslai Homes all

been taken onto the streets. www.opendemocracy.net The public and voluntary sectors need to cultivate leaders who understand innovation. That’s the message from an interview with Joe Ludlow of innovation foundation NESTA. Speaking to the Guardian’s Public Leaders Network, he said leaders needed to be ‘comfortable with the blurring boundaries’ between sectors. A major part of that, he added was ‘about values, mindset and organisational culture – being committed to improvement, taking managed risk, being focused on customers and beneficiaries and positive outcomes’.

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in the top 100, which also featured a number of local authorities, health trusts, police forces and big private sector firms like Barclays and IBm. the top housing performer was metropolitan Housing, which came in at an impressive number five in the list. According to mark Harrison, metropolitan’s Diversity Strategy manager, his organisation views a real commitment to diversity not only as a key part of its social purpose, but also as a driver of better performance. metropolitan has tailored specific services to gay people, including providing a refuge for gay men facing domestic violence and marketing low-cost homeownership products to members of the LGB community. And in the workplace, it has ensured that all staff know that its support for LGB equality is not just on paper. “Leadership on this issue has been very visible,” says mr Harrison. “It can have left no staff in any doubt that we as an organisation fully support LGB staff and will not tolerate any discrimination. the leadership has to be tangible – people have to see it’s not just something on paper but something that’s in your face, constantly promoting the message that the organisation is committed to this.” Among the positive initiatives at metropolitan is an

LGB staff group, metro, which allows staff members to network and, alongside members of the organisation’s women’s, disability and black and minority ethnic staff groups, provides an opportunity to take issues directly to the top. Former metropolitan Chief Executive Bill Payne, chosen as Stonewall’s individual Champion of the Year for 2012, used to meet with the groups on a regular basis and they also contributed to his annual appraisal process. metropolitan also has inclusive staff policies and mandatory diversity training, which specifically covers LGB issues, so that new recruits understand the organisation’s culture from the outset. But although there is an increasing awareness of the value of working ever harder on diversity – and of measuring yourself against the standards set by Stonewall – for some housing organisations it is still not a priority, says mr Harrison. “It is fair to say performance on this is varied. Some are better than others,” he says. He stresses, though, that the results are worth the effort – and the dedicated resources – involved. “there are massive implications for service delivery from getting this right,” he says. “People who do feel valued are much more likely to be committed to an organisation and do a better job, which has a very positive impact on customer satisfaction.”

Being a gay-frienDLy empLoyer: tiPs from HoUsiNg’s toP-raNkEd ProvidEr Strong and visible leadership from board members and senior managers is essential

Workplace staff groups provide an effective channel of communication

Good use of internal communications, such as intranet and newsletters, can help spread the message

Policies and procedures should be framed and worded with diversity firmly in mind

training is key in ensuring the culture of your organisation is right

A commitment to dedicating resources to the issue is key.

A recovery in the private sector has meant the fee income for management consultants has returned to the levels seen before the financial crisis, according to the Financial Times. The Management Consultancies Association said private sector income rose by 14% in 2011, on top of a 12% rise the previous year. Public sector income fell by 19% last year, making the ratio of private to public work now 80:20. Fewer than 1% of board members of top firms have a background in human resources, People

Management reports. The magazine says a survey by HR recruiter Ortus suggests that HR professionals are ‘seriously underrepresented’ at the highest level of the UK’s top 50 companies. Of 595 board directors, only five had HR expertise. There are eight core beliefs which tend to be shared by the very best bosses, according to an article on Inc.com. Among the mantras outlined are: ‘My employees are my peers, not my children’; ‘Change equals growth, not pain’ and ‘Business is an ecosystem, not a battlefield’. www.inc.com

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govErNaNcE roUnD-Up

risky It’s a controversial finding – and one that has stirred up the debate about women on boards once more. According to a Bundesbank report, the more women on boards, the riskier the decision-making. That means, the paper suggests, that policy-makers should think carefully about gender quotas on boards. “Board changes that result in a higher proportion of female executives... lead to a more risky conduct of business,” it says.

The paper, which looked at the boards of German banks over a 16-year period, also looked at the age of board

bUsiNEss members, concluding that younger executive teams increase risk-taking. But critics have argued that while it considers age, the research doesn’t fully pay heed to the different levels of experience of board members. They also point out that the report itself says the effects of any riskier decision-making it studied were ‘marginal’.

tWo-Way

strEEt

Increasing numbers of housing organisations are getting involved in mentoring, whether it’s to develop their own staff or to support local people to do better in their lives. But it’s not just those on the receiving end of mentoring schemes who benefit.

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An evaluation by think tank Demos of the Mosaic mentoring scheme for young people in deprived communities suggests that two-thirds of the mentors involved believe the experience has given them new skills. Three-quarters felt they had gained a better experience of young people, while 80% valued giving something back and nearly a third felt they had improved their communication skills.

Demos says the positive impact of mentoring schemes on mentors has not always been properly understood, but that it has a big role to play in promoting community cohesion.

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Stock rationalisation has been on the agenda for decades. But as the now defunct Tenant Services Authority acknowledged three years ago, there’s often been a reluctance on the part of housing associations to seal a deal. There have long been reasons why rationalisation makes sense, particularly in local authority areas where scores of associations have been operating, some of them with only a few homes on their books. Tough economic times and the push for greater efficiency make those reasons more compelling than ever. But there are long-standing barriers too – not just the ‘fear factor’ felt by associations reluctant to hand over their stock, but also the time, cost and effort of putting together a deal. Back in 2009, the TSA published a best practice guide showcasing successful examples of rationalisation. Since then the pace has hotted up. Deals over the last year range from the relatively small scale, such as Southern Housing Group’s sale of 46 homes to West Kent Housing Association and a transfer in Cleethorpes of 58 properties from Raglan to Shoreline Housing

Giving young people a say about their communities is a priority for many housing organisations. But getting them involved in governance is even more of a challenge. Now Liverpool-based Plus Dane has taken its work on youth engagement one step further by establishing a new route for young people to take their place in the boardroom. Plus Dane, whose Chief Executive Ken Perry is interviewed on pages 14 and 15 of this issue of The Governor, is aiming to ensure young people are represented in decision-making at the highest level by setting up a shadow board which will develop young board members who will then take their place on the organisation’s main boards. Mr Perry said the youth board would give young people the chance to gain the skills they need to have their voices heard. “Ideally I would have liked not to have a youth board but to have young people on the board by

Partnership, to the sizeable, such as Home Group’s sale of more than 1,000 homes in the midlands to Derwent Living. The Derwent deal last year was also notable for being the first to be funded by a pension fund.

sWapsHoP Stock swaps, rather than simple sales, have often been a way of overcoming the issue of a reluctance to lose units. And one of the latest swaps to be announced is an interesting one, involving four associations. A2Dominion, Catalyst, Inquilab and Notting Hill Housing Trust transferred more than 700 homes between each other. The transfer, which completed this spring, allows each association to focus on the management of homes on specific estates in Southall, Greenford and Hayes, west London. In these times where value for money is a key driver, we can expect this type of stock swap to become even more popular in future.

right,” he says. “However I accepted that that might have been a bit too big a step and that they need their confidence building first by being with their peers. But we are doing this on the basis that they will have the same business and the same papers as our other boards.” Mr Perry adds: “We don’t just want to engage them on young people’s issues – we want them to bring their perspective on everything to the table.”

yoUtH sPEak

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