New challenges for housing associations
A combination of the credit crunch, the worst recession since the 1930s and a squeeze on the public sector - their main source of grant funding, means social housing providers are under pressure to re-examine their strategy for the future.A combination of the credit crunch, the worst recession since the 1930s and a squeeze on the public sector - their main source of grant funding, means social housing providers are under pressure to re-examine their strategy for the future.
A new analysis, published today by the Chartered Institute of Housing Scotland and the Scottish Government, says the sector faces unprecedented challenges as the country enters a period of fiscal austerity.
A combination of the credit crunch, the worst recession since the 1930s and a squeeze on the public sector - their main source of grant funding, means social housing providers are under pressure to re-examine their strategy for the future.
New Climate, New Challenges urges Scotland’s housing associations to maximise efficiency and effectiveness and be ready to compete for resources in the difficult financial climate.
It’s not just the economic climate which is formidable. Registered social landlords face new legislation in the Housing (Scotland) Bill, which will bring changes to the regulatory system and right to buy legislation, and increased competition from the private rented sector and councils, who are now starting to build again.
One of the report’s authors, Professor Kenneth Gibb of the University of Glasgow, argues that large reductions in public spending, upward pressure on tax and likely downward pressure on welfare expenditure and capital funding for housing and regeneration, make for a different climate for housing associations compared to recent years.
A government efficiency agenda highlights the need for innovative ways of funding investment at lower subsidy levels, and the academic warns Scotland needs a clearer strategic vision of social housing policy.
Joint author Karen Neary, a leading housing practitioner, outlines positive ways landlords such as Govanhill, Clyde Valley, Dunedin Canmore and East Lothian housing associations are already adapting to the changing environment. The report provides a useful toolkit for others to review their individual strategies and operation.
“The sector has a long and successful history and there is no doubt many RSLs will succeed in turning challenges into opportunities,” she said. “But this unprecedented economic climate demands efficiency on a grand scale and double quick.”
She recommends the Scottish Government focus on a comprehensive review of housing policy and strategy, while allowing housing associations to get on and use their experience and develop their contribution to regeneration.
Minister for Housing and Communities, Alex Neil welcomed the launch of the publication at CIH Scotland’s annual conference in Glasgow: “Housing policy is at a crossroad. Traditional methods of providing housing will need to change because of the scale of the new challenges – climate change, new lending climate, and squeeze on public funding.
“More than at anytime before, value for taxpayers’ money will underpin the Government’s investment in housing.
“I hope housing associations use Karen and Ken’s work in their business planning meetings to look at the questions, and solutions, it raises and how they can be adapted to address problems.”
Alan Ferguson, Director of CIH Scotland, said: “We now stand at a critical point. The years ahead will see different challenges, resulting from the credit crunch and the recession. Housing associations will be tested as never before and their relationship with Government and local authorities will also be put under new scrutiny and strain. How they respond is vital, not only for the housing system but for Scotland’s people as a whole.”
Andrew Field, Acting Chief Executive of the Scottish Federation of Housing Associations said: “As the report highlights, a number of associations have developed innovative solutions to ensure that they meet housing need, in spite of a shortage of public funding.
“The SFHA continues to work with its members and the Scottish Government to look at meeting the challenges caused by limited public funding and growing housing need.
“This is a timely report which I would hope that housing associations and co-operatives across Scotland consider as they map out the vital work they are doing in the years ahead.”
Jim Harvey, Interim Director of the Glasgow and West of Scotland Forum of Housing Associations, said “Housing associations must be in control of their own future, and this report gives practical guidance to help them do that. While we don’t agree with all of the report, we’re pleased it highlights the role housing associations can play in regeneration, and how changes to national housing policy could help us build on the real difference that housing associations already make to local communities all over Scotland.”