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<li><a href="../features">Features</a></li><li><a href="../features/category/finance">Finance</a></li><li>Identifying threats</li>
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<h1 id="features_header">Identifying threats</h1>
<p id="article_info"><span>Published 01 March 2024</span></p>
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<p>ROOF's survey shows rising building and maintenance costs are still the number one concern, but housing benefit reform is looming as a problem</p>
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<p>Once again, rising building and maintenance costs are considered the ‘greatest threat’ to business by the largest number of finance directors. Altogether, more than half of those who responded to our survey said this was either an issue, or the greatest threat. As in previous years, a link was made between rising costs and rental income which is limited to 0.5 per cent over inflation. </p>
<h2>Housing benefit reform </h2>
<p>Plans to replace housing benefit with a local housing allowance, paid direct to tenants, is starting to emerge as a big concern. Again, more than half of finance directors put this as an issue, although only two described it as ‘the greatest threat’ to their business. </p>
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<p>‘It will be significant as it effectively accelerates the effects of rent restructuring by introducing a flat-rate benefit,’ said one director. ‘Also of considerable concern is housing benefit paid direct. Two thirds of our tenants are on housing benefit so the impact on arrears could be great.’ </p>
<h2>Supporting people </h2>
<p>The way in which housing-related care is paid for is clearly a problem at the top of a lot of finance directors’ in-trays. Ten out of our 20 respondents said this was an issue, with three saying it represented the ‘greatest threat’. </p>
<p>Cuts were seen as the biggest problem: ‘The real reduction in the pot nationally is worrying – especially housing associations with high dependence.’ </p>
<p>Another said: ‘There is a lack of realism about savings needed.’ </p>
<p>And there was real anger: ‘Another example of the government expecting us to pay for what they should be providing. Either the support needs to be given or it doesn’t. It is inequitable that the support starts and then is arbitrarily withdrawn basically following a consultant’s report from someone who has nothing to do with delivering the service.’ </p>
<h2>Insufficient government investment </h2>
<p>Lack of funds was flagged up by seven respondents. All but one said it was an issue, rather than the greatest threat. </p>
<p>‘As a transfer association we are a direct result of past under-investment,’ said one finance director. Now we’re a ‘registered social landlord’ we are constantly being asked to do more for less, which I feel is an attempt by government to get us to pay for what they should be sorting out. For example, we are expected to deal with anti-social behaviour issues that may not even be our tenants and really are a police matter.’ </p>
<h2>Uncertainty about government priorities </h2>
<p>Three finance directors said this was the greatest threat to their business. </p>
<p>One pointed out that government priorities sometimes seemed to be at odds with each other. ‘We get lots of talk about efficiency and the need to improve, which is then almost immediately followed by another wave of regulation and rules. For example, the Audit Commission inspection is looking at best value, but the inspector appeared to to have no understanding about how partnering is supposed to work. They’re looking for best value reports on the worth of an individual post, but losing sight of the bigger issue.’ </p>
<p>Another said they felt overwhelmed: ‘Uncertainty about government priorities is a big issue compounded by too many government bodies being involved – the Audit Commission, the Housing Corporation, the ODPM – together with far too many initiatives. Sometimes I feel I have initiative paralysis.’ </p>
<h2>Other issues and threats </h2>
<p>Finance directors identified other big issues and threats: </p>
<ul>
<li>The increasing or continuing levels of right to buy leaving a reduced rental stream in the long term which will be unable to support the borrowing needed for stock investment </li>
<li>Loss of Ground 8 – a mandatory grounds for eviction – to manage rent arrears. </li>
<li>The proposed clawback of disposal surpluses/recycled grant – fundamental to associations with lots of shared ownership homes </li>
<li>Commonhold leasehold reform act. </li>
<li>Uncertainty about long-term impact of the housing market renewal initiative </li>
<li>Private developers bidding for housing grant. </li>
<li>Rent controls. </li>
</ul>
<p><em>ROOF contacted 20 finance directors from the top 40 housing associations. </em></p>
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<p><strong>Tags: </strong><a href="../features/tags/tag/tenants" title="tenants">tenants</a>, <a href="/" title="government">government</a>, <a href="../features/tags/tag/arrears" title="arrears">arrears</a>, <a href="../features/tags/tag/finance" title="finance">finance</a>, <a href="../features/tags/tag/rent" title="rent">rent</a>, <a href="../features/tags/tag/care" title="care">care</a>, <a href="/" title="US">US</a><>
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