What Do Housing Associations Stand For?

This week I was at the retirement of one of the housing world's longest serving leaders. Tom Murtha of Midland Heart has been around in housing for even longer than me and we worked together for a number of years in the late 80s and early 90s. As he said farewell to assembled friends and colleagues it was good to see that his passion for a cause was undimmed. Tom wears his heart on his sleeve and lives for fairness. He had a voice, and wasn't afraid to use it, and what he stood for and his contribution to the sector should be remembered.

At Trafford Housing Trust we like to think we live our values and they are certainly deeply embedded within the organisation. But that's not quite the same as standing for something - and for people knowing what that something is. I've called before for the sector to have a new relationship with customers, government and communities and that would be a good start in making a stand for something. But we could do more.

What should we choose to make a stand for?

The positioning of the sector under the National Housing Federation's "In Business for Neighbourhoods" brand might have worked, if all housing associations had been signed up and delivered it. But because a brand has to describe what you actually do, not what you hope you do, the fact that some high-profile organisations shunned the concept, it therefore failed the "does what it says on the tin" test.

Always fraught with problems such as those faced by InBiz, the possibility of a single sector "brand" has now gone forever. After all, the Audit Commission has lost its role of homogenising the sector through the stifling of local innovation, so can we really expect that all housing associations will stand for the same thing - let alone expect private and for-profit providers to stand for it as well? The conclusion is that housing associations need to find their own voice; they need to be more overt about the things they stand for; they might even take that as far as campaigning for change.

Where would I start? Well, for once in this blog I will speak with my own voice - not one that can be associated with Trafford Housing Trust - at least not at this stage. Personally, I'd start with speaking up about the damage done to individuals, neighbourhoods and communities from inadequate support to those with mental ill-health. I'd promote the benefits that investment in simple and low-cost services can bring and I'd campaign for people with mental ill-health to get a realistic package of support to enhance their employment chances.

But that's just me - whether it's mental health or something else, associations must know what it is they stand for - and if they need some advice on how to get their voice heard, they could do worse than entice Tom Murtha out of retirement and get him to help!

A Tale Of Two Budgets

I've said on this blog before that I have tried to get into the minds of ministers in this government, without, I hope, actually thinking like them myself. I consider this to be a necessary evil because only that way can I build an idea of what might happen next and start the process of aligning our organisation to whatever the future might bring.

What's inside? Time will tell.

Governments are always in a hurry at the start of their term, hoping that by the time they need the electorate's support again, the worst effects of whatever changes they want to make will be forgotten. As their term progresses the rate of change tends to fall, but you can still get indications about what might happen after the next election. It's a moot point whether the rate of change from this government has yet peaked, but with the exception of the so-called "Granny Tax" there wasn't that much unexpected in this week's Chancellor's Budget. However, there was one - long term - thing, that struck me powerfully.

As ever with budgets there were the nominal winners and losers. Smokers, drinkers and drivers will, predictably, feel hit. Industry and high-rate tax payers will feel slightly less pain than the rest of us, as their role to create the employment that is designed to help the "squeezed middle" and to get people off welfare is encouraged and nurtured. For the so-called "crushed bottom" (and it's a bit of an indictment that such a phrase can emerge) there was, frankly, not much light at the end of the tunnel, and if you rely on welfare the concern would be that the light could be an oncoming train.

It was comments on welfare that really struck me. Already, the welfare reform bill with its benefit caps and bedroom tax is taking significant sums of money out of the pockets of the poorest. The government say that they are so determined to break the dependency cycle, that they are prepared to fight the next election on the grounds of further cuts of £10 billion to welfare spending. This is a point that the housing sector should not take lightly, because that money is coming out of the pockets of our tenants.

As a strategic response I can see three possible directions, the first two of which are distinctly unattractive. We could go “upmarket” and let our homes mainly or exclusively to those in secure work, leaving to others the task of dealing with the poorest and most vulnerable in our society. Then there is a response that sees us cut rents and engage in the kind of race to the bottom currently seen in the social care arena as Supporting People budgets get withdrawn.

At THT we are exploring a different approach which sees a focus on helping people manage budgets and find work. We are fortunate – Trafford is one of the economic engines of the whole of Greater Manchester with good employment prospects, even more so now the Metrolink extension has been announced which will run through the Borough to the Trafford Centre and create a promised 5,000 new jobs. So there are work opportunities that we can link our residents with.

So, approved on the same day as the Chancellor's Budget, but without the same underlying narrative of cuts, Trafford Housing Trust's Budget creates a whole new team of money and job advisors to support residents with getting into work. These aren't the only extra posts, within what we clearly see as a budget for growth. We will be taking on a further eight local apprentices and providing volunteering opportunities for a further six young people. We will be investing more in new homes than ever before and creating new jobs in the process. Our CleanStart programme which provides work opportunities for offenders leaving (and in a new move – for those still inside) prison goes from strength to strength.

When the new regulator comes calling and asks what our approach to value for money is, my Board is clear. Building new homes is just a part of it, rebuilding lives is just as important.

A Time For New Relationships

In starting this blog I’m acutely aware I’m perilously close to committing the heinous sin of perpetrating a blogging cliché. We have reached March and the indications are that Spring is ready and waiting to emerge. I can readily imagine then that if I wrote about the process of rebirth in housing and possibly used a nice shot of some daffodils to illustrate the idea that you would, understandably, lose all faith in me. I’ll ask you to note then that the image of a lamb gambolling in the field is used ironically.

Spring: the season for cliches about renewal.

Today’s topic is the idea of renewal – that other great cliché of springtime blog posts. Specifically, I’ve been thinking about the renewal needed for some of the key relationships that housing associations have with tenants, government and communities. I’ve been pondering this recently because I believe that the flux that many are experiencing in the sector can lead to one of two reactions. Either the stormy conditions force organisations to down sails and take shelter. The other solution is to see the great gusts of wind as an opportunity to cover fantastic distances in a short space of time.

However you see the situation - the onus is on us to create original solutions – to innovate in other words. I believe if we don’t make the choices about how our organisations address the key questions, then others will and that I believe is where the real danger lies. For me, the approach we should be looking at is to reinvent what housing associations are and how others see us. That process starts by changing the way we relate to three groups in particular: tenants, governments and communities.

The new relationship with our tenants should give us a far greater say over who moves into and out of our homes. Tenants should have far greater clarity about if and when they will ever receive a property and more choice surrounding the services they receive. Irwell Valley’s Gold Standard drew criticism, but I suspect that in years to come we will see it as a ground-breaking product. Is now the time when we should provide our tenants with more incentives to “do the right thing” while they’re living in our homes? Should our focus now be doing as much to encourage independence and personal responsibility, as to protect the vulnerable?

Think about it - why shouldn’t there be some kind of “entitlement” built up each year by tenants who stick to their tenancy agreement, perhaps to be released after five years as a deposit, or as a “discount” on the purchase of a new home? Or how about establishing a new kind of mutual funded by a credit union, where each customer buys a share that allows them to occupy a property owned by the mutual. The value of the company (and of each customer’s share) is directly related to the behaviours of the customers. When people moved, they would sell their share in the company for the then current value.

The new relationship with government has to start with a revitalised description and shared understanding of value. So much of the current system of grants awarded to build new homes does not take into account the long-term value that the Government get from housing associations. Long after the cement mixers have been silenced the housing associations are providing a return on the initial investment. The longer term benefits created by the neighbourhood work we do already are complex to measure and we urgently need commensurately sophisticated tools to do the job. But we can also offer to do more - for example, how different might the world look if that grant was dependent on the rate that a housing association managed to get people off benefits and into a job?

Finally – we need to renew the relationship we have with communities. Localism is an exciting prospect but it needs time to mature and deliver its benefits. The possibilities of this new relationship with communities include assets that are transferred from local authority to community control. It would also be supporting community initiatives from food-growing programmes like the “Incredible Edibles” brand; reshaping high streets and supporting the use of parks and leisure centres. It could even extend to new employer towns – could the New Bourneville be found on the maps sometime soon? But realising this requires a clear and transparent "Social Dividend" to be declared; something that quantifies the cash that will be used to fund these wider activities and shows clearly that they are not being pursued at the expense of being a good landlord.

Of course some housing associations will align themselves to a model that more closely resembles that of private homebuilders, rather than of community-based social enterprises. Good luck to them - let them pursue the private equity they will need and live with the need to show their new financiers a 15-20% return. For others, like THT, who have a balance sheet capacity, an appetite for this more competitive world and an interest in place-shaping, the freedoms from a centralised "one best way" approach from the Audit Commission means we can, and will, investigate how these new relationships can be brought about. I believe that following this path could reveal the greatest opportunity of all – a chance to combine the best of private, public and third sectors and create housing organisations that have social value at their core.

What Do YOU Think Housing Associations Are For?

Yesterday I was at a Risk Management conference. No, don't stop reading yet, because actually, this was a really interesting day with luminaries like Piers Williamson from THFC and soon-to-be one of our new Regulators, Hannah Fearn from the Guardian housing Network and Andrew Cunningham from private sector landlord - Grainger PLC all giving really interesting insights into their worlds. I'd been asked to talk about what a housing association might look like and do if it set out its stall to be an active social enterprise. Not to be a housing association that supported social enterprises, but to turn itself, in its entirety, into one. My conclusions were that it was possible, some organisations were trying to do it (and Trafford Housing Trust is certainly one of them), but it's a hard road to go down, with many barriers in the way.

Path A or Path B? You decide...

What was more interesting, I thought, was a straw poll I took at the start of the session. I was following Hannah Fearn from the Guardian Housing Network, who in her talk had contrasted some of the assumptions we might make about the world of housing and its interface with politicians, with what was actually going on. So I decided to try a bit of assumption testing of my own. I took a bit of a risk and asked everyone to stand up. Fortunately, they did (thank goodness we're such a compliant nation) and I explained what was going to happen. I was going to give everyone four sets of paired statements; if the audience believed statement A to be true in each case, they could sit down, but if they believed statement B they could remain standing.

The first pair of statements were about the real, underlying purpose of housing associations. Do we A) exist to protect the most vulnerable, or B) to promote personal responsibility. There was an uncomfortable moment of uncertainty - no-one wanting to be the first to sit, but eventually, after a momentary pause, about 15% of the room sat, with another 10% looking pretty uncomfortable in a "hovering" position, before gravity - or perhaps historical thinking - pulled them chairwards.

The second pair of statements got a more clear-cut response from the 75% still standing. Were we A) there to build houses, or B) there to build communities. Pretty much everyone thought that community building was our raison d'etre, and so only one or two more people sat down. The third pair were more contentious. As a sector was our job to A) "have and hold" our homes - or was it B) to "churn" them - selling where we could release value to re-invest in new.

I have to say I was surprised that another 20% sat down - as I'm pretty sure that the overwhelming majority of Boards in our sector are like mine; poring over any property sales with the utmost care and adopting an "if you can let it, keep it" approach. Finally, I asked people if they supported our sector providing A) homes for life or B) homes only for when people needed them. This was the one I'd expected most people to sit down over, in fact, hardly anyone else moved and so I was left with about 40% of the audience still standing.

This was of course only a straw poll and was far from representative. But the room contained people from forward-thinking housing associations and the proportion still standing at the end was a real surprise to me - in constructing the exercise I'd actually thought there might only be a handful left standing at the end. If it is the case that around half the sector believes we should churn property, house people only when they need our subsidised product, build communities and have a focus on promoting personal responsibility, an awful lot of business models and business practices within housing associations are going to need to be turned on their head - because sure as eggs are eggs - that's not how we operate now.

Is it what's needed? Will we do it? In the infamous Geordie words of the Big Brother narrator: "You decide..."