POLICY CONSULTATION RESPONSE
DSD PROPOSALS FOR A NEW REGULATORY FRAMEWORK FOR SOCIAL
HOUSING PROVIDERS IN NORTHERN IRELAND
By the Chartered Institute of Housing in Northern Ireland
June 2015
The Chartered Institute of Housing (CIH) is the independent voice for housing and the home of
professional standards. Our goal is simple – to provide housing professionals with the advice,
support and knowledge they need to be brilliant. CIH is a registered charity and not-for-profit
organisation. This means that the money we make is put back into the organisation and funds the
activities we carry out to support the housing sector. We have a diverse membership of people who
work in both the public and private sectors, in 20 countries on five continents across the world.
Further information is available at: www.cih.org
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SUMMARY

CIH NI agrees that a new regulatory system is needed to enable social housing
providers to innovate and to maximise the use of their developed capacity and to
incorporate a standard that aims to protect and empower tenants

CIH NI supports a risk-based approach to regulation that is focused more on
outcomes and less on processes

CIH NI supports the three proposed standards for regulation: consumer; governance
and financial

CIH NI believes that the outcomes and ‘guidance’ under each of the three suggested
standards should be consulted upon

CIH NI believes that this guidance and practices should include opportunities for
consumer/tenant involvement with the regulator at a strategic level

CIH NI believes that the proposed standards can be strengthened by the
amendments set out in response to question two

CIH NI agrees that the regulator should provide a rating covering each standard

CIH NI agrees that regulation should be flexible enough to focus on commensurate
effort, but the effectiveness of this approach will depend on the guidance and
practices used by the regulator

CIH NI agrees that DSD should introduce additional powers for the regulator to
ensure the quick and effective resolution of any issues

CIH NI believes that the question of who regulates is central to considerations about
what is regulated; we propose that the regulation function should be independent
from government control and political influence

CIH NI believes that regulation of rents should be included within the regulatory
framework

CIH NI believes that consumer/tenant groups should be able to make representation
to the regulator if dissatisfied with the performance of the social landlord under the
regulatory framework

CIH NI believes that there should be an appeals process or independent arbitration
for when disputes arise
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HOW OUR RESPONSE IS FORMED
This response is based on the experiences of housing professionals, including CIH staff, in
Great Britain and Northern Ireland. Nationally, CIH developed the concept of ‘resident-led
self-regulation’ (RLSR) as a way to enhance resident involvement and improve performance
management and to bring about change to regulation in social housing. The case for this
reform and suggestions of how it could be developed within housing organisations were
presented in several reports, which culminated in “Leading the Way” (CIH 2007). Since then,
a number of GB housing organisations developed and began to use RLSR. We believe their
experience can inform the development of the consumer standard in the new regulatory
framework for NI. These lessons are incorporated into our response below.
Regionally, CIH staff in Belfast have almost forty years experience of working in housing in
NI. This includes interpretation and analysis of housing law, policy and practice as well as
the development of professional standards for housing professionals and practitioners.
CIH draws upon our members’ experience. We have approximately 500 members in NI;
earlier this year we surveyed them on a number of policy issues. To gauge the importance,
or otherwise, of independence in social housing regulation we asked whether members
agreed or disagreed with the statement “there should be an independent housing regulator
for NI”. Overwhelmingly 80 per cent of those who responded (10 per cent of members)
either strongly agreed or agreed that there should be an independent housing regulator for
NI. Comments included:
“Sector needs strong independent regulation.”
“This should also be prepared to intervene and enforce.”
“The present arrangements represent a confusion of roles and it is imperative that
there is a separation of regulation from the policy determination function. There is
evidence that government has used regulation as a means of effecting its desired
policy objectives.”
“DSD is not best placed to regulate the social housing sector – it should concentrate
on securing sufficient public finding and devising and implementing policy… The
social housing sector should be regulated by an independent body that could be
financed by a levy on the social landlords and governed by a board of representatives
of the social housing sector.”
This view on independence concurs with CIH views and as such has informed this response.
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CONSULTATION QUESTIONS
1. Do you agree the standards in the revised regulatory framework should cover three
areas i.e. consumer, governance and financial?
CIH NI strongly agrees that the standards in the revised regulatory framework should cover
the proposed three areas of: consumer; governance; and financial.
There are already increasingly positive results relating to governance and financial
regulation. We believe it is vital to continue this trend within the context of a risk-based
approach. This is necessary to protect public funds and assure private investors, while
providing the social housing sector with the opportunity to maximise the use of their
developed capacity.
However, it is equally important that regulation focuses on consumer/tenant wellbeing as
well as economic wellbeing. The regulator should require information about; monitor; and
intervene fully under all three standards. Apart from making good business sense,
consumer/tenant empowerment and opportunities for involvement at a strategic level is
central to best practice in social housing. Any evidence of poor practice in this area should
be a trigger for regulatory intervention to support consumers/tenants and so the
importance of their involvement is underlined. For example, CIH disagreed with the UK
government’s decision (page 15 of the consultation document) to change the role of the
regulator in England to become more reactive in its approach to consumer protection. This
sends a message that consumers/tenants are not an equal priority under regulation, while
shifting responsibility for service scrutiny to tenants and landlords with minimum guidance.
CIH NI is pleased that DSD is proposing to give equal weighting to regulation of all standards
i.e. consumer, governance and financial.
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2. Where social housing providers demonstrate the standards set out in this consultation
it will provide stakeholders with assurance on the effective and appropriate operation of
their businesses. Do you agree?
CIH NI does not necessarily agree that stakeholders will be provided with assurance where
social housing providers demonstrate the standards as they are currently set out in this
consultation.
In moving towards a risk-based regulatory system naturally the parent standards will be less
prescriptive. DSD is proposing that attached to each standard would be specific outcomes
and guidance for providers with focus on ‘commensurate effort’. The consultation
document provides some examples of these. CIH NI believes that these should be further
consulted upon to ensure they are comprehensive and include good practice examples to
help to promote sector standards. This guidance and the practices used by the regulator will
influence the effectiveness of the regulatory framework.
For example:
(1)
Under the consumer standard “social housing providers shall provide reports on
tenant satisfaction surveys” we believe that the regulator should take account of
consumer/tenant assessments of housing provider performance and trust them as
being accurate. In doing so, the regulator is accepting more than a social housing
provider’s report summarising tenant satisfaction – it should be about engaging with
tenants directly where this is achievable. Where professional and consumer/tenant
views differ, further investigations should be used to establish why and to provide
justification of regulatory decisions.
(2)
CIH NI also believes that the standards can be strengthened by amendments, for
example:
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In consumer standard outcome 1 include

Social housing providers should have a plan for tenant participation
development and expansion to support a focus on continuous improvement
throughout the organisation that in turn commands stakeholder confidence.

Social housing providers should review their tenant involvement activities and
structures on an on-going basis to see whether they offer the maximum
opportunities for resident influence, coordination and self-determination, and
whether they confer real power on residents to drive change. Steps should be
taken to increase these opportunities wherever possible.

Social housing providers should enable consumers/tenants to act on its
consumer standard rating provided by the regulator, drawing on independent
support such as the independent tenant organisation suggested in the tenant
participation strategy.
In consumer standard outcome 3, under “They work in partnership with other
Agencies to contribute to:-” include

The prevention of homelessness

The use of housing in breaking down divisions
In consumer standard outcome 3, under guidance include

Social housing providers shall use the right tools at the right time in managing
anti-social behaviour, proportionate to the problem faced and where housing
support is provided rather than denied with eviction as an option of last resort.
3. Do you agree that the regulator should provide a rating covering each standard
(consumer, governance and financial)?
CIH NI agrees that the regulator should provide a rating covering each standard. This would
enable the provider and consumers/tenants to easily recognise areas for improvement. A
rating for each standard, as opposed to an overall rating, would allow the regulator to
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quantise and make recommendations around performance deficits in specific business
areas, which may require targeted improvement measures such as training.
For reasons of transparency we believe these ratings should be publicly accessible and easily
comparable between providers. This could also give further confidence to investors and
consumers/tenants.
4. Regulation should be flexible enough to allow the regulator to adjust the approach for
each social housing provider based on factors such as size, development plans, previous
regulatory history and business complexity? Do you agree?
CIH NI recognises the need for a regulatory approach that is commensurate to the landlord’s
function – namely their aims and objectives, customer profile, and/or size. We think DSD’s
proposals of size, development plans, previous regulatory history and business complexity
adequately reflects these concerns. However, as mentioned previously, the underpinning
policies and practices that support this focus on ‘commensurate effort’ would need to be
known to comment on the effectiveness of this proposal. This should be subject to a period
of monitoring to establish an evidence base and it may be appropriate to set a date for
review.
5. The Department should introduce additional powers for the regulator to ensure the
quick and effective resolution of any issues. Do you agree?
CIH NI agrees that DSD should introduce additional powers for the regulator to ensure the
quick and effective resolution of any issues raised. The consultation document states “as far
as possible [meeting regulatory standards] should be achieved by common ownership of the
standards, self-improvement mechanisms, regular tenant-led and other independent reality
checks on progress and a continuous sharing of good practice”. While this is certainly true,
where problems are identified the regulator must be enabled to enforce regulatory aims
through effective and direct action, as an option of last resort.
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6. Do you agree with the findings in the Impact Assessment screening reports? Please
provide your reasons.
A consistent approach to regulation would give more assurance that no Section 75 group
would be adversely impacted while effective consumer/tenant involvement under the
consumer standard, especially involving special needs residents, could break down barriers
arising from section 75 status and/or geographic location. However DSD would have to
satisfy itself that the effect of moving to a risk based approach, focused on commensurate
effort, would not have an adverse impact on certain groups. Further analysis of this policy,
based on tenant profile against risk factors, may therefore be required.
ADDITIONAL RECOMMENDATIONS
(1)
While CIH NI appreciates the question of where the regulator will be located has
been set outside the scope of the consultation, the questions of how and who are
inseparable. It is vital that regulation and housing policy determination are separate
so that the regulator cannot be used as a means to effect desired policy objectives –
independence would underpin the transparency of and confidence in social housing
regulation. An independent housing regulator with statutory basis is also essential if
construction of affordable homes is to increase and sustainable investment in
existing stock is to be maintained. In our view, it would reassure private lenders and
allow housing associations to attract more private borrowing under more favourable
terms. To this end we think the ‘objectives of a new regulatory framework’ should be
amended to incorporate a reflection of the desire to operate the new framework
free from political control.
(2)
CIH NI supports regulation of rents being incorporated within the framework. Rents
should be determined free from political interference using the framework of an
evidence-based, long-term and sustainable rent setting policy.
(3)
Consumer/tenant groups should be able to make representation to the regulator if
dissatisfied with the performance of their landlord under the regulatory framework.
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This could, for example, be progressed via the independent tenant organisation
suggested in the tenant participation strategy.
(4)
The inclusion of an appeal mechanism or independent arbitration where disputes
arise can give credibility to the regulator’s decisions.
FINAL COMMENTS
The housing association sector has developed especially in recent years. We believe that
their innovation and development going forward is best facilitated by DSD’s proposed move
to a risk-based approach to regulation that is focused more on outcomes and less on
processes. While CIH NI appreciates the question of where the regulator will be located has
been set outside the scope of the consultation, in our view the questions of how and who
are inseparable and we continue to support independent regulation.
In moving towards a risk-based regulatory system naturally the parent standards will be less
prescriptive. We believe that the guidance to which the regulator would have regard in its
focus on commensurate effort should also be consulted upon so stakeholders can respond
with consideration to the totality of the proposed regulatory framework. Regulatory
guidance and practices should incorporate opportunities for consumer/tenant involvement
with the regulator at a strategic level and the ability for consumer/tenant groups to make
representation to the regulator.
For more information please contact
Justin Cartwright
Policy and public affairs officer
Chartered Institute of Housing in Northern Ireland
P: 028 9077 8222
DD: 028 9078 7733
M: 07824 304 351
E: justin.cartwright@cih.org
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