On 23 July, trainees from Anthony Collins Solicitors will host an ‘experience day’, which will involve various activities and presentations, with lawyers and non-lawyers from across the firm.
IDAs will assess an RP’s quality of governance, assessment of risk and its risk mitigation strategies. It is not yet clear whether value for money will feature as part of all IDAs (and differing approaches have been taken during the pilot programme). The Regulator has indicated that it will take a ‘first principles’ approach, starting from the premise that the RP has a G4/V4 rating, with the onus on the RP to give sufficient assurance that they are at the appropriate governance and viability ratings. This demonstrates a marked change to the approach previously taken by the Regulator, where a move away from current straplines for an RP (in effect) had to be justified by the Regulator.
Moody’s were quoted in Social Housing magazine earlier this year as saying the financial difficulties experienced by Venture Housing Association showed the ‘limitations’ of co-regulation. The Regulator’s introduction of IDAs has been likened by Jonathan Walters, Deputy Director of Performance and Strategy, to the approaches taken by such ratings agencies and is therefore clearly intended to give greater comfort that the business plans and governance arrangements being put in place across the sector are being tested robustly against the requirements of the Regulatory Framework.
The Regulator has stated that this should not be a move back to the KLOE days of the Audit Commission, with a checklist approach to assessing an RP’s governance and financial viability. Feedback on the pilot IDAs supports the validity of this statement. Speaking at a recent Placeshapers event with Charlie Norman (Chief Executive, St Vincent's Housing Association), Richard Foster (Senior Investigation and Enforcement Advisor, HCA) reinforced the point that a bespoke approach was, and would be, taken to each IDA, with key areas of concern in relation to individual organisations identified and assessed.
The concern is whether this level of individual treatment and investigation can realistically be undertaken with every organisation, if the Regulator is to achieve its suggested programme of carrying out an IDA for every RP (owning over 1,000 units) at least every four years (with additional IDAs carried out as necessary for ‘rapidly changing’ and riskier RPs).
The IDA, if it is to be delivered in line with the approach taken to the pilot programme, will prove a useful tool for RPs. The IDA will test the strength of their business and governance arrangements to ensure they are fit for purpose and able to deliver their desired objectives, and will also deepen the Regulator’s understanding of each RP’s business. Undoubtedly there’s also the potential for the strengthening of the relationship between individual RPs and the Regulator.
However, if a ‘straitjacket’ approach is taken, it will bring into question the usefulness of the IDA and what it will add to current regulatory tools, given the ever more diverse nature of the sector and the increase in more complex governance and funding arrangements.
Both the Regulator and RPs need to keep sight of the fact that IDAs should be a means to an end – strong and effective organisations – rather than an end in themselves.
For more information
Contact Gemma Bell.
In the second part of our series on contract management pitfalls, we look at the risks and opportunities presented by payment mechanisms in construction contracts.
Under most construction contracts, the contractor takes on the ground conditions risk. However, a recent case has demonstrated that the risk can fall on the employer.
The UK Government has been consulting on how it should promote social value in its procurements. Here is our response that we submitted to the consultation...
The Tenant Fees Act 2019 came into force on 1 June 2019.
A recent case in the Court of Appeal will no doubt bring a sigh of relief for employers, but a corresponding sigh of disappointment may be uttered for equality and gender balance in the workplace.
This briefing assists response to the consultation paper by outlining the consultation questions, providing some background information and prompting some thoughts and potential answers.
A report published on 29 May by the Institute for Fiscal Studies (IFS) has found that since 2009-10, local government spending on services has fallen on average by 21% in real terms.
A long-awaited decision of the Court of Appeal has clarified that a lower standard of proof should apply than previously thought before an Inquest can return a conclusion of suicide.
New regulations come into force on 1 June 2019, amending the Section 21 (s21) prescribed form template for use with assured shorthold tenancies.
To receive invitations to our events, as well as information and articles on legal issues and sector developments that are of interest to you, please sign up to Newsroom.