Housing speech at NIFHA conference

Recently I spoke at the 2012 conference of the Northern Ireland Federation of Housing Associations and this is the text of the speech.

 

Mr Chairman, Ladies and Gentlemen, Conference Delegates. Many thanks for your warm welcome and kind invitation to join you on this, the second morning of your Annual Conference. I am very pleased to be able to address this distinguished gathering and to be able to share with you my views on the very important issues affecting social housing here in Northern Ireland.

 

Last year at your annual conference I issued a challenge to the housing association movement to be fit-for-purpose and just this week I received a letter updating me on your work in supporting the strengthening of the movement. I thank you for that and will take time to consider this update on your work.

 

From the economy, to social reform, to the need to support the most vulnerable, there are a wide range of challenges facing housing and how we respond to these challenges will, I believe, test not only our capability and capacity, but also our vision and resolve to transform our society and people’s lives for the better.

 

The theme of your conference is ‘Pursuing Excellence’ and I believe that is more appropriate now than ever before. To achieve excellence, one must be intentional and have vision. To that end I launched Northern Ireland’s first housing strategy on 15 October. Time does not permit me to cover the entire document but I would like to point to some of the proposals which address excellence.

 

We will continue to innovate in how new social housing is funded, building on the successes that you as Housing Associations have had in leveraging in private investment for new homes. We will improve standards in the private rented sector too so that no tenure here is viewed as inferior. Landlords will be registered, deposits protected and the regulation of houses in multiple occupation improved. Social housing should no longer be seen as an end in itself. We will seek ways to improve the energy efficiency of all housing stock here as a key weapon against fuel poverty and in line with good stewardship of our resources. We will raise the fitness standard for all homes, driving excellence forward, while reducing the unnecessary duplication and overlapping requirements which form a regulatory burden specific to social housing construction.

 

We will pursue excellence in housing services ensuring that the allocation of social homes is improved, that social housing stock is better utilised with services to assist under-occupying households to move if they wish. We will also develop an accessible housing register to better reuse adapted housing stock. We will fund housing advice services on these and other issues ranging from welfare reform to supported independent living. We will continue to fund Supporting People to help vulnerable households access and sustain private rented housing. We will act on the findings of the Interdepartmental Review of Housing Adaptations Services and commission primary research into the housing intentions of older people.

 

Our cities and towns have much that is excellent but some areas are in a cycle of blight. We will tackle blight in these areas, bringing empty homes back into use as decent homes, encouraging living over shops, taking measures against anti-social behaviour, creating jobs and apprenticeships for our young people and providing new opportunities for shared communities to flourish. The areas must flourish and blight must not.

 

To achieve excellence we must look at our delivery mechanisms. We must have the best structures in place for social housing for Northern Ireland. That means that we need to critically examine the current structures in the Housing Executive, the Housing Association movement and, of course, my own Department’s Housing Division, which has policy oversight for all of this.

 

The fundamental review of the Housing Executive concluded that to ‘do nothing’ is not an option. Rather than a negative statement this should be seen as a reflection that change is required to move social housing forward. The change in structures is required to ensure we can continue to deliver well maintained housing stock, improve the focus on strategy and ensure value for money for taxpayers in the future.

 

I have circulated a paper to all Executive Ministers which outlines my vision on future housing structures. I hope to announce a way forward on developing new structures shortly, and by March 2015, to have new structures in place to take forward the fundamental review of the Housing Executive.

 

Turning now to events at a UK level, everyone in the room will be aware of the welfare reform agenda which is progressing. We know that its implementation is unavoidable. I think that most of us will agree that the key principles behind this legislation are positive and we should recognise the real positives and opportunities that can be achieved as a result of some of these reforms.

 

First: we need a welfare system that protects the vulnerable; Second: a welfare system designed in such a way that it provides the maximum support and encouragement to get people involved in economic activity; Third: a system that is fair; and Fourth: a welfare system that promotes personal and social responsibility.

 

I welcome and recognise the need for many aspects of reform. However, there is a challenge to support the people most affected, particularly in the transition to Universal Credit.

 

There are a number of reforms intended to bring the spiralling cost of Housing Benefit expenditure under control. In Northern Ireland, Housing Benefit expenditure in respect of rent increased from £335.2million in 2004-05 to £490.7million in 2010-11. From the outset it was never the intention that Housing Benefit should guarantee that people on benefit would have unrestricted access to accommodation at any price.

 

I do however recognise that under-occupation in the social rented sector exists for all sorts of reasons, one key change to Housing Benefit affecting social sector tenants due to be introduced in April 2013 is the under-occupation measure.

 

Under current proposals any household deemed to be ‘under-occupying’ their home by one bedroom stands to lose 14% of their Housing Benefit and those ‘under-occupying’ by two or more bedrooms will lose 25%. It is estimated in excess of 30,000 tenants in the social housing sector will be impacted here.

 

The challenge is to ensure both that we do not add to the level of under-occupancy through inappropriate new allocations and also that we take appropriate steps to assist affected tenants. Tenants affected may make up the shortfall, move to a smaller home, incur arrears, or taking on a boarder/lodger. Landlords have a key role to play in ensuring that tenants understand the changes and what they will mean for them.

 

You will be aware that I have asked social landlords to consider whether there are opportunities to bring forward smaller sized accommodation, through new build schemes or re-configuration, which will increase their stock of smaller accommodation/one-bedroom units in those designated areas of need. My officials are working with the Housing Executive to develop a range of support measures to compliment those outlined in my Housing Strategy in which we can mitigate under occupation for those tenants affected. I ask all landlords to ensure as far as is possible that all options are explored to prevent social tenants from being evicted from their homes. I also intend to increase funding available for discretionary housing payments and change the legislation to allow such payments to be made to all social housing tenants.

 

The principle of parity means there is limited scope for Northern Ireland to vary from the GB reform agenda. However, in regard to the direct payment proposal under Universal Credit, following protracted negotiations, numerous visits to London and telephone calls, agreement was secured with Lord Freud, I recently confirmed that the housing costs element of Universal Credit will be paid automatically to the landlord rather than the claimant, with an opt out arrangement for those who choose to receive the full Universal Credit payment and in turn pay their landlord. In addition, the IT system functionality will be developed to enable the computer system, where necessary, to split the payment between the two parties in the household, and, again where necessary, to make two smaller payments per month rather than the single full monthly payment. This will help avoid rent arrears for many low income tenants and ensure that individuals remain safe in their tenancies while protecting social housing revenue. Let us not underestimate the value of these flexibilities – this is a real example of devolution delivering for Northern Ireland – If in doubt ask some of your colleagues in Scotland, Wales or England.

 

I am committed to tackling both under-occupancy and overcrowding through building more homes and providing help, advice and support to those seeking to downsize. It is crucially important that we continue to work with GB government officials to develop a programme of welfare reform that is tailored to the particular needs of Northern Ireland. Discussions are continuing with regard to the impact of Welfare Reform on Housing Benefit and I am pleased that Lord Freud has agreed to visit Northern Ireland later this month to support us in those discussions as they progress.

 

I have mentioned the challenges posed by the reforms to Housing Benefit. Our response to these challenges must be to ensure that everyone has access to an affordable home, be that in the private rented sector or the social housing sector, under a tenancy they can sustain. Many individuals will be impacted, each in specific ways; and I believe our response needs to be equally tailored. I am already working closely with the key housing providers to develop services in response both to those changes that have already taken place and in preparation for those to come. Dealing with the impacts requires careful consideration and I will be listening carefully to what people are saying, studying the findings of the research we have commissioned and seeking to put in place practical measures and support that will make a real difference to those impacted.

 

But that is the big picture. What have you, the Associations and NIFHA been doing in working with my Department? 2011/12 was another successful year for the movement as a whole in delivering more social housing for our clients, - prospective and existing tenants, in either providing better homes or providing new homes for those that did not previously have a place that they could call home. This is the first core principle in the Housing Strategy: -Citizen First – as homeowners, tenants and taxpayers, the strategy commits to delivering for the people of Northern Ireland.

 

But this does not come without Value for Money considerations and proper Governance of Housing Associations, who benefited from £143.1m last year in Housing Association Grant. I need hardly tell conference that this has come at a cost to seven Associations who are currently suspended from the programme because of problems and non compliance issues identified by the Department’s Inspection Teams. But suspension from the programme because of a critical inspection report does present real opportunities to some of the smaller associations experiencing, development or weak management to amalgamate or share services with another Association. A number have already gone down that route and I am very pleased to advise that SHAC Housing Association, who had previously experienced problems, has now become a member of the Oaklee Homes Group.

 

This is an emerging good news story following a less than favourable inspection carried out by my department in 2009. At that point in time the Board of SHAC deliberated on remedial action and was supported in a new environment via a Service Level Agreement with Oaklee Homes Group. In true partnership spirit and consulting my department throughout the process, the Association has been transformed to create a rejuvenated, fit for purpose, cost effective social housing provider.

 

To reach this point the Association went through a difficult process of renewal. However, the simplification of tasks and resources provided by Oaklee ensured significant savings and many positive results that helped to build the momentum and teamwork to develop and progress to effect the necessary organisational change.

 

SHAC continues to operate under its own name as part of the Oaklee Homes Group and will work tirelessly to provide social housing to those in housing need.

 

Other Associations can tell a similar good story and I pleased to be aware of a group of North Belfast associations who are currently considering amalgamation which will ultimately benefit tenants, who are not only tenants but these are also my constituents.

 

You will have heard me say before that we must have a leaner, more fit for purpose movement to take on the challenges that lie ahead. That means more robust structures and more innovation.

 

As I am out and about across the country, opening new schemes, it is obvious there is a wealth of talent out there. Tenants speak highly of what housing associations are doing and I see it for myself.

 

The challenge for all of us is to harness the abilities of the clearly more successful housing associations in support of those who just don’t have the breadth of expertise to compete as they did in the past.

 

I am encouraged by your progress on mergers and amalgamations. You have clearly identified that rationalization is the way forward. If housing supply is going to be increased, as it needs to be, we need growing organisations with the broadest possible range of expertise.

 

You will have seen in my new Housing Strategy that there is much for housing associations to do. There are a range of issues included, that have the potential to significantly grow the housing association sector. I would encourage you to embrace the new opportunities that are about to come your way.

 

One of the key themes in the Housing Strategy is about ensuring access to decent, affordable housing for all who require it. If we are going to come anywhere close to making that objective a reality, our aim has to be to find ways of making public subsidy work as hard as it can to achieve maximum benefit. The Strategy outlines a range of initiatives that involve changing the way in which we currently do things.

 

Where social housing is concerned, you already know that the Department over specifies the design of social house construction. The result is substantially increased costs that prevent you from developing alternative, more cost effective designs. Work has already started to bring social housing standards into line with those used for private housing. Result - more houses for our budget.

 

The same rationale applies in proposals to harmonise rents for future new builds. The aim is to increase levels of private finance and lead on to more housing supply.

 

On the wider front, from the £19m available from the Get Britain Building Fund to allow you to provide more shared ownership housing, through introduction of developer contributions when market circumstances improve, through long term leases with private sector developers and looking at how Housing Association Grant might be paid to a wider range of bodies - all are aimed at increasing supply to create new housing opportunities for our most vulnerable citizens.

 

We all know the real and pressing needs our society faces whether as citizens needing appropriate housing whether it be affordable housing, private rented or social - or our struggling construction industry with the many families relying on these jobs needing us to respond. Meeting targets isn’t something to congratulate ourselves on - we need to smash through them, striving to achieve more and more.

 

I as Minister with responsibility for Housing need your help in taking this significant body of work forward. In doing so I want to allow space for creativity and ingenuity, I want your ideas on how we make the system work better and in doing so I expect my department to respond and adapt when required. The days of doing things in a certain way, well just because that is the way we have always done them are over. I look to you as I look to myself and my department to up our game – much has certainly been achieved but there is much to do.

 

Let us leave this conference with a renewed vision and a determined mind to transform housing wherever we serve.