Housing must be more innovative during spending squeeze, says regulator
Housing associations must find new ways of raising money so they can plug gaps caused by cuts in government spending, says the chief executive of housing's independent regulator.
Peter Marsh, chief executive of the Tenant Services Authority, warned the sector that associations will miss out on the opportunity to match money on offer from private lenders if they are not more innovative with their assets.
Speaking at the Chartered Institute of Housing's annual conference, Mr Marsh suggested that one quarter of homes that had been built for shared ownership could be rented out at intermediate or full market rents when they become vacant, while 1 per cent could be sold outright. Councils might use similar ways to raise money depending on the outcome of consultations over the housing finance system.
There were also opportunities for housing associations to cut management costs by 10 per cent by sharing “back office services”, he told delegates on 24 June during a session called 'Talk to the TSA'.
Between £25m and £35m of further private finance was available to invest in affordable housing providing the sector can match it with funds of its own, said Mr Marsh. “We can't risk that money not being drawn down so that new supply [of housing] dries up,” he added.
Earlier, TSA chair Anthony Mayer stressed that it would be 'business as usual' for the regulator while the government decides whether the TSA should be abolished. It was unlikely to disappear before April 2012 even if, as housing minister Grant Shapps has indicated, the TSA is likely to be scrapped to save money.
The TSA, which was set up under the 2008 Housing Act, could only be abolished by Parliament, said Mr Mayer. And this was at a time when MPs face a large legislative programme. “In the period until, and if, we are closed, we have no intention whatsoever of dying a lingering death,” he told delegates on June 24.
Mr Mayer was speaking hours before the housing minister was due to address the conference in Harrogate and outline his plans for the sector, including the future of the TSA.
If the TSA is abolished, part of its regulatory powers could pass to the Homes and Communities Agency. Mr Mayer said he believed passionately in the work the TSA is doing but accepted that ministers had the right to abolish quangos if they wish. “We are going to carry on doing our job until a new arrangement comes into place,” he added.
Mr Marsh dismissed a suggestion from a delegate that it should give up its role sooner to provide the sector with certainty. “Until part 2 of the 2008 Act is switched off, we are accountable to Parliament,” he said.
He also warned providers not to miss this October's deadline for submitting their first annual reports to tenants, part of the TSA's new regulatory framework. “We have enforcement powers that we don't want to use, but we will,” he said.