The Regulator of Social Housing has today published 'Value for money metrics and reporting 2020'.
The report sets out the position across the sector against a range of value for money measures in the year to 31 March 2020, and looks at the trends since 2018.
Value for Money is a key regulatory standard and this publication is designed to help boards and executives to understand their relative performance on a selection of key financial metrics. It is also vital that registered providers look at a strategic level how they deliver the most value for the communities they serve, including current and future tenants.
The report shows that despite a fall in operating surplus, registered providers' reinvestment in existing and new social housing stock had risen to its highest level since 2018. The average Headline Social Housing cost, increased by 4% to £3,830 reflecting a range of factors including expenditure on building safety.
While the sector continues to be committed to future growth, some areas of the country had seen a slowdown in market sales activity which meant providers affected increased their borrowing to maintain delivery of new social housing supply in the future. For 2019-20, the median rate of new supply, both social and non-social housing, was consistent with previous years' performance.
There was a wide range in performance on the value for money metrics across the sector, primarily due to providers' different geographical locations and sizes, as well as whether they provide supported housing or housing for older people.
It is important that providers' Boards understand the range of factors that could influence performance, and provide robust challenge to management where they are not making the most effective use of the provider's assets and resources. There continues to be an increased level of interest on how providers' value for money performance influences their ability to support tenants and ensures existing stock is well maintained.
Fiona MacGregor, Chief Executive said:
Having a strategic approach to delivering value for money and providers maximising the delivery of their objectives is a key regulatory requirement.
At a time when registered providers face a growing range of competing pressures and will be forced to make difficult choices, the importance of focussing on value for money has never been more important. These hard choices and trade-offs will demand informed strategic decision-making and will benefit from transparent and open conversations with key stakeholders.
It is more important than ever that Boards maintain a clear focus on delivering value for money as an integral part of running their businesses so that they can deliver effectively for current and future tenants, local communities and other stakeholders.
Notes
- The Value for Money standard requires providers to annually report on their performance against a suite of measures defined by the regulator.
- For 2019-20, and due to the impact of the COVID-19 pandemic, RSH took a proportionate approach to VFM reporting, particularly on forward-looking VFM performance commentary
- The Value for Money report is part of the regulator's continuing work to help the sector contextualise the performance of individual providers more easily. It aims to help boards compare themselves to organisations with similar business models and geographical locations. It is an annex to RSH's Global Accounts, published in March.
- The Value for Money metrics data file contains information at a provider level. The report is accompanied by a detailed Value for Money Technical note, which explains the metrics in greater depth. These documents and all previous VFM publications can be found on our VFM collections page.
- The Regulator of Social Housing promotes a viable, efficient and well-governed social housing sector able to deliver homes that meet a range of needs. Its role is defined in legislation to have an economic regulation objective relating to private registered providers, and a consumer regulation objective relating to both local authority providers and private registered providers. In line with current legislation, RSH regulates consumer standards reactively.
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