In a regulatory judgement published today, the Regulator of Social Housing has concluded that Christian Action (Enfield) Housing Association Limited (Christian Action) is non-compliant with the financial viability element of the Governance and Financial Viability Standard.
In December 2022, the regulator found significant weaknesses in Christian Action's governance and downgraded it to a non-compliant grading (G3). The regulator found that Christian Action needed to address weaknesses in its financial governance, including inadequacies in financial monitoring and board reporting.
Through its ongoing reactive work, the regulator has concluded that there are ongoing indicators that Christian Action's financial position is weak and delivery of its financial plans remain challenging. Christian Action continues to be exposed to material risks that it needs to manage with limited financial resilience and, as a result, the regulator has now downgraded Christian Action's grading for financial viability to V3 (from V2).
Christian Action has failed to demonstrate that it has a robust financial plan or that it is managing its financial performance effectively. As a result of these weaknesses, it has been unable to provide assurance that it has the financial capacity to deal with a reasonable range of adverse scenarios.
In response to the regulator's investigation, Christian Action is reviewing its approach to governance and financial management and has now appointed three new co-opted members to its board. Christian Action has also appointed external advisors to help it develop an improvement plan to address its financial and governance weaknesses.
Harold Brown, RSH's Senior Assistant Director for Investigations and Enforcement, said:
Our investigation reveals significant challenges caused by Christian Action's weak financial profile, which has left it unable to demonstrate the necessary capacity to adequately deal with its financial risks. We will continue to monitor the provider closely as it works to address these issues and return to compliance.
Notes
-
Registered providers of social housing with more than 1,000 units are awarded both governance (G) and financial viability (V) grades for their compliance with the Governance and Financial Viability Standard. Grades of G1 and G2 indicate compliance with the governance element of the Governance and Financial Viability Standard, while grades of G3 and G4 indicate non-compliance. Similarly, V1 and V2 grades indicate compliance with the financial element and V3 and V4 grades indicate non-compliance.
