In a regulatory judgement published today (21 December 2022) the Regulator of Social Housing has concluded that Heylo Housing Registered Provider Limited, a for-profit registered provider, has breached the governance and viability elements of the Governance and Financial Viability and Standard. As a result, it has been given non-compliant gradings of G3* and V3*.
Following an In-depth assessment and reactive engagement, the regulator has concluded that it lacks assurance that Heylo RP has adequate control of its social homes, leaving their future subject to decisions driven by the interests of unregistered connected companies. The regulator does not have confidence in Heylo RP's ability to manage its risks adequately and ensure its own long-term viability.
Heylo RP has commissioned an independent review of its governance arrangements, made new board appointments, and is willing to review arrangements with its parent and the wider group.
Harold Brown, RSH's Senior Assistant Director for Investigations and Enforcement, said:
It is essential that registered providers do not enter into arrangements that compromise their ability to meet regulatory obligations. It is also vital that they have sufficient control over the social homes they provide to ensure their long-term viability. Heylo RP has failed to do this.
Heylo RP needs to address the issues we have identified, and we will monitor it closely as it works to return to compliance with our standards.
Notes
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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.
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Narrative regulatory judgements for large for-profit providers are produced in accordance with this framework. However, RSH recognises that for-profit providers have different capital structures and cash flow dynamics and are often subsidiary organisations within a larger group of connected companies on which the for-profit provider depends to carry out its functions. To provide further clarity we use an asterisk with a for-profit provider's grade (e.g. G3*) to make it clear that the assessment refers to a provider that is designated on the register as being for-profit.
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Heylo Registered Provider Limited is a for-profit registered provider. Heylo Registered Provider Limited was founded following the acquisition of a registered provider and therefore did not go through a registration application to the regulator. On 7 July 2022, RSH placed it on the gradings under review list.
