Borough of Poole Poole Housing Partnership Governance Options

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Borough of PoolePoole Housing Partnership
Governance Options

• 30th March 2009
• Steve Partridge

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Agenda

• Recap organisational options
• ALMOs
• Housing Associations and Housing Companies
• Community Gateway

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3-D options for ALMO authorities

• Organisational
• Financial
• Governance

ALMO
Transfer
ALMO as is
New form ALMO
ALMO as the HA
New/existing HA
Transfer
Subsidy
Self financing
Gateway
Trad Board
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Organisational options

• Continue with ALMO
• Current ownership 100 council
• Develop ALMO into different ownership models
• Options to vary ownership to tenants/community
  taking a share or majority part
• Currently not supported by government but work
  being carried out
• Stock Transfer to the ALMO as a new RSL/HA
• Stock Transfer to the a new or existing RSL/HA
• New housing association set up for the purpose
• New housing association in partnership

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Company limited

• A bit of theory - companies limited by
• Share
• Shareholders purchase shares when they become
  members
• For housing associations - 1 share for all
  members one member one vote at the AGM
• Guarantee
• Shareholders guarantee to purchase their 1 share
  in the event of liquidation
• Co-operative ownership
• Membership in common
• Can take different forms
• Governance structures are not necessarily linked
  to ownership

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ALMO current arrangements

• Ownership
• A company limited by guarantee
• 100 owned by the council but the stock stays
  with the council
• Governance
• Board of management arrangements reflect the
  experience of stock transfer housing companies
  (see later)
• RSL governance best practice has had a major
  influence on the creation of ALMO boards
• Code of practice
• Length of agreements
• Currently established with short or long term
  agreements
• But always short term break clauses

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Different types of ALMO?

• Although currently not supported by government,
  RSL models suggest there may be options on ALMO
  ownership
• Ownership
• Could expand to community/other organisations
• Stock would remain owned by the council
• Governance
• Could change board of management but not
  necessary
• Possible advantages
• If council lt 49 owner, comes out of public
  expenditure and able to raise finance separately
  to the council
• Would need longer term management agreement
• Effective control over the rental stream

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ALMO and community gateway

• Community empowerment options need considering
• Within the ALMO framework, there are some models
  already in place
• Kensington and Chelsea TMO and United Residents
  Housing Lambeth
• Tenant empowerment could be increased through
• Ownership widening ownership to include some,
  majority or all tenants
• Governance changing the composition of the board
  of management
• Local structures
• Separate Gateway approach could also be tested
  (see later)
• Stock stays with the council as remains under the
  ALMO model

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Different types of Housing Association

• Independent, self governing, not for profit and
  regulated
• Housing Association and Registered Social
  Landlord used interchangeably, but several
  different types
• Charitable Trust
• Guinness, Peabody, William Sutton
• Industrial and Provident Society
• Usually originally established for the benefit of
  specific groups
• Traditional 1 share for all members
• Local Housing Company
• Company limited by guarantee
• Ownership generally in three groups council,
  tenants and ordinary (independent) members
• Co-operative models, Abbeyfield societies,
  Almshouses

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RSL types and transfer

• The first 60 stock transfers to 1996
• To Housing Associations along traditional lines
• Industrial and Provident Societies
• Since the mid-late 1990s
• Establishment of the local housing company model
  for transfer
• Originally associated with urban, low value
  transfers
• Now used in a widespread way for virtually all
  transfer proposals
• Advantages of company model
• Council retains a minority stake in the RSL
• Able to influence delivery plans directly in the
  critical first years after transfer
• Reminder ownership not necessarily linked to
  governance

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Community Gateway

• A range of Community Gateway transfers in the
  last 4-5 years Preston, Watford, Bracknell
  Forest
• Tenant ownership and membership
• Governance
• Best practice in RSL Local Company governance
  grafted on to the tenant ownership/membership
  model
• Gateway arrangements
• Gateway Committee
• Membership
• Can be all tenants or opt in
• Usually linked to a very deep commitment to new
  forms of community empowerment and structures

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New or existing RSL?

• Transfer to
• Stand alone RSL created for the purpose of
  receiving the stock
• Poole Housing Partnership
• A completely new organisation
• Partnership and/or existing RSL
• New RSL created for the purpose of receiving the
  stock but joining a group structure with another,
  larger, RSL
• PHP converting and joining a group
• Direct transfer into an existing RSL
• Key issues
• Finance
• Local flavour

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Charitable or not?

• Charitable status can be applied for a HA/RSL
  through the Charity Commissioners
• Trustees and beneficiaries
• Housing necessitous circumstances
• Advantages
• Financial through avoidance of corporation
  tax/land tax
• Financial for the transfer itself through VAT
  shelter
• Helps to promote notion of not for profit
• Disadvantages
• May limit certain activities (eg home ownership,
  market renting etc)

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Note on key differences

• Ownership of the stock
• With ALMO always council stock ownership, with
  transfer stock transfers to the new/existing
  RSL (NB Bolton)
• Ownership of the organisation (PHP or other)
• Now 100 council, other ALMO models and stock
  transfer involve ownership changing
• Change of tenancies if transfer
• Local Authority vs RSL Assured
• Rights to Repair and Manage
• Rights to Acquire and Buy
• Transfer private finance
• Off public sector balance sheet with greater
  financial freedom

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Note on key similarities

• Either ALMO or transfer would mean no change in a
  whole range of areas
• Continuity of service delivery and staff whatever
  the organisation
• No name change if transfer to PHP
• Rent policy
• Rent restructuring for councils rent
  influencing for RSLs
• Target or formula rents the same whatever happens
• Regulation with the Tenant Services Authority
  will be added to ALMOs next year
• Availability of funding from Homes and
  Communities Agency for new build

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Summary governance models