Regulation: resist volatility, but stay reactive - TAI 2017 preview
Helen White, Chair of the Wales Regulatory Board, previews her session at TAI by taking a look at the regulatory landscape.
One vote in favour of increasing interest rates by a member of the Bank of England’s Monetary Policy Committee is the first real evidence that interest rates could be heading up - or is it? U-turns on the budget - seven days after announcing an increase in national insurance contributions for the self-employed, the prime minister and the chancellor scrapped it. Brexit - when will the Article 50 button be pressed and what impact will it have? The possibility of a second Scottish referendum. More ‘fallout’ from Welfare Reform. Hopefully I’ve made the point, the external operating environment is highly volatile at present.
This presents real challenge to the boards of housing associations as they try to plan strategically to meet the future needs of their tenants and communities. Making sure aspirations for the future turn into sound and thoroughly stress tested business plans is challenging. This is compounded as ‘global’ issues are combined with other challenges such as really getting to grips with the impact of welfare reform.
This may all sound a bit depressing but I am pleased to say I can add some stability to the ‘melting pot’ of challenges. The changes introduced to the regulatory framework are now ‘live’, however, regulatory focus continues to be on strategic risks and business viability issues. The first Regulatory Judgements to include a judgement based on the association’s capacity to improve have been published. This is an exciting step forward in how regulation is done in Wales, providing a clear picture of how associations are performing. This clarity is great not only for the Associations themselves but for all stakeholders.
However, the core principles of the framework remain stable;
- Tenants are at its centre. The framework’s goal is that tenants and their families have decent, affordable, homes and receive high quality services.
- Housing associations have to take full responsibility for their actions and the way they operate.
- The framework is based on close working relationships between Welsh ministers, housing associations, their tenants and service users, and key partners.
The ability of the regulator and housing associations to be reactive to change is really important. As is keeping a cool head and not making knee jerk reactions in a complex and ever changing external operating environment. Boards need to be confident in understanding when they need to react and when they don’t. This will be possible when boards work generatively to discuss and debate the big tickets issues on the horizon, accompanied by a robust approach to risk and assurance.
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You can see Helen's session at TAI 2017 by booking to attend.