In a regulatory judgement published today (14 December 2022), the Regulator of Social Housing has concluded that Christian Action (Enfield) Housing Association Limited is non-compliant with the governance element of the economic standards, and has downgraded it to G3 status.
CAHA has been unable to provide assurance to the regulator that it is managing its risks and business planning in an effective way. Weaknesses in its financial governance, as well as a lack of effective board oversight and scrutiny, meant that CAHA failed to identify the potential crystallisation of a serious risk in sufficient time. CAHA also failed to inform the regulator of these risks in a timely way, and its communication has fallen below the standard expected by RSH.
In response to the regulator's reactive investigation, CAHA has started to review its approach to governance and risk management. It is also implementing controls to improve the management of its repairs and maintenance service.
Harold Brown, RSH's Senior Assistant Director for Investigations and Enforcement, said:
We have found significant weaknesses in Christian Action Housing Association's governance, which has exposed it to financial risks. We will monitor the provider closely as it works to resolve these failings and 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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RSH placed Christian Action (Enfield) Housing Association on the gradings under review list on 25 May 2022 to indicate that it was investigating the provider's compliance with the governance element of the Governance and Financial Viability Standard.
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Christian Action (Enfield) Housing Association's gradings are now G3 and V2. Its previous gradings were G1 and V2. The regulator has assurance that CAHA complies with the financial viability elements of the Governance and Financial Viability Standard and that its financial plans are consistent with, and support, its financial strategy.
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However, delivery of CAHA's financial plans remain challenging. CAHA is exposed to material financial risks that it needs to manage. To protect its viability in the longer term, CAHA will need to retain reasonable business planning assumptions and effective cost controls.
