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Next steps in Social Housing Reform

As part of its ongoing work on social housing reform, the Department for Social Development (DSD) has produced a Research and Analysis Brief to inform future housing structures. The paper was recently submitted to the Social Development Committee for consideration. Nicola McCrudden summarises the key issues and conclusions from this paper and outlines next steps in the main reform areas of:

The paper outlines the current position in each area, contains research findings from practices in other jurisdictions, summarises key stakeholder views and sets out next steps.  A copy of the DSD brief is available for download .

Regional housing functions

The DSD reports that there is broad stakeholder support in NI for separating out the regional and landlord functions of the Housing Executive (NIHE). This position is in fact supported by the NIHE which believes “…the operational focus of the current organisation is inevitably pulled towards the challenges of running a large landlord organisation and this has led to a lack of both strategic and operational focus”. There appears to be favour in the regional body remaining a Non Departmental Public Body (NDPB). The DSD also raises the possibility of a regional body with no landlord functions to have “…greater responsibility for regulation and inspection”.

As part of its research the DSD identified that in other jurisdictions, regional housing functions are grouped and delivered through a dedicated body. The Homes and Communities Agency  in England is cited by the DSD as an “effective” model.

Next steps: DSD will consider how the regional functions might be separated from its landlord functions within existing legislative framework; whether there is scope to increase the regional functions within existing statutory arrangements; and what would be involved in creating a separate NDPB regional body.

Housing Executive Landlord functions

As with the consideration of the regional body, the DSD reports that there is support from NIHE and NIFHA for separating the landlord and regional functions. However, it acknowledges that the status of the new delivery structure, or structures, is far more contentious. The fundamental concerns amongst stakeholders are about funding the landlord services and whether the new structure(s) sits within the public sector or not for profit (housing associations).

NIHE position is that a fundamental change is needed as “…the inability to access sufficient capital funding has and will increasingly result in tenants living in sub standard homes”. With regard to size, boundaries and numbers of landlords NIHE favours three, either stand alone or as part of one group.

Tenant representative bodies believe that any change of landlord should be subject to a tenant vote. Other concerns are potential rent increases and loss of rights, the need to input to the process and how scrutiny of landlord performance would be undertaken. Interestingly, the DSD reports that concerns from elected members generally reflect the concerns of tenants as well as the need to avoid any politicisation of housing.

Trade Unions support the retention of social housing within the public sector, suggesting NIHE should be able to borrow to meet its capital requirements. While housing associations warn against over reliance on a small number of large associations under the new structure.

In its analysis the DSD says “It is clear from our analysis that there is strong support for a tenant focused, social housing landlord, providing high quality homes and wider tenant and community services”. It also sates that “Whilst there is strong evidence to suggest that the large scale voluntary stock transfer appears to offer a solution to both the finance challenge…it is clear there is neither political consensus nor stakeholder consensus to support a total stock transfer and there is a strong element of support for the retention of public housing.”

Next steps: DSD will take forward detailed consideration of landlord structure(s) that will support the separation of the regional and landlord functions, including how such a structure might function as a public corporation. It will also consider the impact of a stock transfer to housing associations, including the creation of a new housing association or possible transfer to existing associations. This option will explore the possibility of partial stock transfer. Finally, the DSD agrees that tenant consultation and a tenant vote should be a requirement of any stock transfer.


The DSD acknowledges the importance of rent to social housing in that:

  1. it must be affordable for tenants,
  2. it must provide for the required maintenance and investment to underpin quality homes, and
  3. it must provide confidence to lenders about the long term sustainability of the system.

The DSD findings have shown that lack of a comprehensive rent setting policy has led to NI having the lowest public rents and amongst the highest housing association rents in the UK. It says “It is questionable whether either of these two positions are sustainable in the longer term without, on the one hand, undermining the quality of public housing for tenants in the future or on the other restricting access to social housing for low income families on affordability grounds”. The DSD concludes that there is strong evidence to support an overall rent policy which provides some control within the social housing sector to allow an “appropriate balance between affordability and sustainability”.

Rents being affordable was a key consideration of groups representing homeless people. Whilst rent sustainability was a view held by those financing housing and, to a certain extent, by housing associations themselves.

Next steps: DSD will take forward and consult on a rent policy for social housing. This is likely to be developed within existing legislative and regulatory framework.

Regulation and Inspection 

Regulation of social housing in Britain follows a risk based approach. This is where the regulator considers the operating environment and identifies risks that could impact them. Common across other jurisdictions is an element of independence. In NI, regulation sits within the DSD.  The DSD stakeholder analysis shows that social housing landlords hold the view that regulation in NI should be more risk based with a focus on outcomes. Tenants believe the regime must provide assurance and confidence in services provided. There are also housing organisations and professionals who are of the view that the Regulator should be independent from the DSD. The DSD is of the view that the regulatory function must be independent from the delivery function.

Next steps: DSD will take forward detailed consideration of the regulations and inspection regime including the powers of the Regulator and the implications of transferring the function to the new Regional Housing body.

Departmental functions

The DSD reports that stakeholders did not directly comment on the role of the DSD. It concludes that there is general support for the role of the DSD in terms of overall strategy, policy, legislation, finance and oversight. It does see potential in transferring some strategic NIHE functions to the DSD and likewise transfer some delivery functions within DSD to NIHE.

Next steps: DSD proposes to take forward detailed consideration of the functions and activities of Housing Division and NIHE and identify any that might transfer from one to the other.


The report highlights engagement with tenants and elected representative as core requirement of social housing. Meaningful tenant engagement, as the report says, should improve customer satisfaction. While effective engagement with local government is important at both an operational and strategic level.

Stakeholder analysis shows that local government has identified the need to retain and enhance the engagement with housing structures. It was felt that this is even more necessary under local government reform. Councillors particularly like the uniformity and clarity which comes with NIHE district office structure – particularly when dealing with complaints. There was also support to retain the NI Housing Council to ensure input to housing at a more strategic level by local government.

In relation to tenants, DSD research findings show that focus on tenant engagement and empowerment is strong in the rest of the UK and led by government policy. It acknowledges that there is no Departmental tenant strategy in NI. The views of tenants were collected through voluntary and community sector stakeholders where there was strong support for more meaningful tenant engagement. The DSD recognises there are “clear benefits for tenants and housing providers from tenant participation at all levels of housing”.

Next steps: The DSD will take forward detailed consideration of systems for local government engagement at both a local and regional level. It will do the same with tenant engagement specifically to:

  • Develop a Tenant Participation Strategy;
  • Review the regulatory framework so that social landlords develop tenant strategies to be subject to regulation and inspection; and
  • Explore how, at a regional level, tenant services and engagement can be supported.

The paper has been submitted to the Committee for Social Development to seek their views on the research and analysis carried out and on the next steps. The DSD has indicated that it intends to bring to the Committee the outworkings of these next steps over the next six months. It is likely a work programme will be agreed with the Committee and that the DSD may be reporting on monthly basis.

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Social Tenancies, Policy