whose stock is it anyway? local authority perspectives on the future of almos

Whose stock is it anyway?

Local authority perspectives on the future of ALMOs

November 2010

This report has been produced by:

Steve Douglas and Lanek Banga of DouglasWood


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Contents

1. Key Messages....................................................................................................................... 2

2. Acknowledgements ............................................................................................................... 5

3. The purpose of this research................................................................................................. 6

4. The role of the ALMO ............................................................................................................ 7

5. ALMOs as a contractor.......................................................................................................... 8

6. ALMOs and tenants............................................................................................................. 10

7. The future of ALMOs........................................................................................................... 11

8. The case for retaining the ALMO – National Federation of ALMOs .................................... 14

9. Conclusions......................................................................................................................... 16

Appendix 1: Option appraisal case studies ............................................................................... 18

Appendix 2: Guiding principles in relationship between ALMO and council.............................. 23

Appendix 3: About HouseMark.................................................................................................. 25

Appendix 4: About DouglasWood ............................................................................................ 26


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1. Key Messages

The option of establishing an arm’s-length management organisation (ALMO) to deliver Decent Homes and to improve housing services was set out in the 2000 green paper Quality and Choice: A Decent Home for All.

Nearly a decade after the creation of the first such organisation, many of the management agreements between ALMOs and their parent local authorities are reaching their end. These authorities are now considering their future stock investment options and the role of their ALMOs within that thinking.

This report explores parent local authority thinking on:

reasons for ALMO formation the experience of having an ALMO as a contractor1 the future of ALMOs

To provide the ALMO sector view, the report includes a National Federation of ALMOs (NFA) perspective on the future of ALMOs. However, it should be borne in mind throughout that the remit of this report is to provide a local authority perspective.

1.1 ALMO achievements

It is generally acknowledged that the ALMO model has succeeded in its objectives. It is therefore common ground between local authorities and ALMOs that:

Decent Homes programmes have either been delivered or are generally on track to

be completed by the vast majority of ALMOs ALMOs have significantly improved housing management services – out of 68

ALMOs, the Audit Commission has rated 22 as three-star and a further 39 as two-star organisations

ALMOs have played a key role in increasing resident satisfaction within the local authorities in which they operate

ALMOs have delivered significant levels of efficiencies2

ALMOs have made great strides in developing tenant and leaseholder engagement and feedback mechanisms, including bringing residents into governance roles in the housing service, often for the first time.

However, notwithstanding these achievements, local authority perspectives on the future of their ALMOs differ. Some authorities plan to retain their ALMOs while others are considering bringing them ‘in-house’. A handful of authorities have converted, or are in the process of converting, their ALMOs into stock transfer housing associations.

1 The use of the term contractor reflects the fact that local authority interviewees spoke of a contractor/client relationship. However, in legal terms the ALMO is managing agent and where the local authority/ALMO relationship has worked best that relationship has been more akin to partnering. 2 For example, an analysis of Annual Efficiency Statements by Steve Partridge for the Housing Quality Network in 2006 found that 68% of local authority efficiency gains in 2005/6 emanated from councils with ALMOs despite comprising only 21% of the authorities in the sample


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1.2 What drives council perspectives on the future of their ALMOs?

Our research indicates the following drivers in local authority thinking about ALMOs.

1.2.1 Working relationships

Where there has been clarity around roles and responsibilities between the ALMO and its parent authority – and an agreed definition of what ‘arm’s length’ management means – council support for retaining the ALMO is more evident.

Conversely, where the ALMO is perceived as having been more independent than the parent authority has wished, it is more likely that the ALMO service will be taken in-house. A similar telling comment was made by a number of authorities interviewed for this research:

1.2.2 The ALMO needs to recognise ‘whose stock is it anyway?’

The point here is that these parent local authorities were clear that they owned the stock and the ALMO was their contractor to deliver housing management and maintenance services and Decent Homes improvements. However, they felt that the ALMO had forgotten this and was taking decisions as if it were the owner. In contrast, the most successful ALMOs have recognised the primacy of the parent authority and have delivered services on that basis.

1.2.3 Performance

Where an ALMO has been seen to deliver on the local authority’s agenda, council support for retaining it is more evident. Unsurprisingly, in the few cases where the ALMO has struggled to attain two-star status, there is less council support for its retention.

1.2.4 Council perspective on the role of the ALMO

Every authority interviewed for this research said that the ‘carrot’ of significant levels of funding for stock investment – and being able to obtain it without transferring ownership of the housing stock – was the main driver for setting up an ALMO. Where the role of the ALMO has been narrowly defined as a ‘Decent Homes delivery vehicle’, it is more likely that upon completion of that task the council will terminate the management agreement and bring the service back in-house.

Where the ALMO has delivered on a wider agenda for the parent authority, it is more likely to have a long-term future. Significantly, following completion of the Decent Homes programme, a number of local authorities are now exploring a wider role for the ALMO arrangement beyond just housing management and maintenance services, even if this was not the original motivation for the authority creating the ALMO.

1.2.5 Value for money

The view that an ALMO service should revert to in-house management is accentuated where the parent authority – in the context of the current pressure to secure efficiency savings – considers that retaining an ALMO means continuing to bear duplicated and unnecessary costs in management and overheads.


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Conversely, other parent authorities consider that their ALMOs have delivered value for money and expect that they will continue to do so. In these cases, the ALMO model is seen as delivering considerable efficiency savings in management and maintenance, and in back-office costs. This points to a need for ALMOs to be as proactive as possible in identifying the efficiency savings they have achieved, publicising them and showing how they can continue into the future.

1.3 Making a decision on the future of an ALMO

Whatever the stage a local authority has reached in making a decision about its future stock investment options, and the role of its ALMO, there are some key factors that the authority and the ALMO board should consider before a final view is taken.

1.3.1 Making the case for retaining the ALMO

In making the case for the retention of the ALMO, the boards of ALMOs are advised to demonstrate that the ALMO is:

committed to remaining, or becoming more accountable to the parent authority willing to make an enhanced contribution to the future strategic thinking of the

authority keen to acknowledge its role as a contractor to the authority in all its branding,

external liaison and interaction with tenants and local communities an efficient and effective organisation, able to recognise and respond to the key

financial and service delivery challenges faced by the authority developing clear plans to show how it will deliver on these promises, particularly by

way of a formal offer in respect of what it will do to help the authority deliver on its wider (housing and non-housing) strategy – a contractor plus or partnership offer

The last point is particularly important. To quote the National Federation of ALMOs: “These are challenging times and it is vital that ALMOs understand and are wedded to helping their councils meet their local agendas. ALMOs are going to have to pedal even faster to help their authorities. The sector needs to build on the unique benefits of the ALMO model to deliver more locally and across sub-regions.”

Whether it is contributing to estate regeneration, economic prosperity or general health and well being, an ALMO must align its approach with that of the parent authority. ALMOs should recognise their need to set out strong and coherent offers explaining how they will go about doing so in specific local circumstances, especially in terms of costs/efficiency savings. At the same time, they also need to differentiate themselves from other local authority partners, including housing associations, to demonstrate what added value their continued existence will bring.

1.3.2 Factors that authorities should consider when deciding the future of their ALMO

In determining their future approach to stock investment, and the role that ALMOs may play in it, local authorities are advised to consider:

the part that the ALMO model might play in the future rather than any narrowly-

defined Decent Homes delivery role that it has fulfilled to date


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the benefits that arm’s-length commissioning may deliver following the government announcements on the comprehensive spending review (CSR) and housing revenue account reform, whether and how the gains in resident engagement, increased tenant satisfaction and improved service delivery can be maintained in any new arrangements

the cost savings and efficiencies that can be generated through shared services compared to winding up an ALMO

the implications of the forthcoming government announcement on HRA reform for the future management of council housing

It may be, of course, that having considered these issues the parent authority still decides to bring its ALMO service in-house. Where this happens, the council should avoid ‘throwing the baby out with the bathwater’, by ensuring that it:

replicates the performance framework associated with the ALMO’s success builds on the ALMO’s focus on service delivery and service improvement continues with, or develops, the ALMO’s arrangements for tenant/leaseholder

engagement

As well as the ALMO setting out its offer to the council (see above), the local authority should be prepared to set out its offer to tenants. This will bring clarity to the debate and provide a proper basis for tenants to express their views.

Finally, any decision to change the long-term arrangements for stock management should involve the same level of resident consultation as carried out when the ALMO was first set up. While local authorities are of course aware that the stock is theirs, tenants’ interests should be at the heart of their decision making.

2. Acknowledgements

The authors would like to thank the following people who have contributed to this research:

Neil Stubbings London Borough of Hillingdon Carol Hinvest London Borough of Hackney Mark Reynolds Oldham Metropolitan Borough Council Brian Queen, Alison Simmonds London Borough of Hounslow Tim Willis London Borough of Ealing Lisa Marston London Borough of Redbridge Mike Owen Cornwall County Council/ Carrick Homes Paul Walker Salford City Council Martin Shields Gloucester City Council Gwyneth Taylor National Federation of ALMOs Neil Jervis Red Loft Development Consultants Senior representatives at the Homes and Communities Agency

The report was edited by Ross Fraser and Steve Platt of HouseMark.

The findings and observations, however, are those of the authors.

If you would like to discuss any of the points in this paper, please contact Steve Douglas at [email protected].


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3. The purpose of this research

In the 2000 green paper Quality and Choice: A Decent Home for All, the then Labour government set out an ambitious timetable to ensure that social housing met a Decent Homes standard by the year 2010. For local authorities, there were four routes to achieve this standard:

a large scale voluntary transfer (LSVT) a private finance initiative (PFI) an arm’s-length management organisation (ALMO) retaining the stock and carrying out the investment in house

The PFI and ALMO options brought considerable additional funding directed into local authority housing revenue accounts (HRAs). For many local authorities, once they had considered their various options, the ALMO route seemed to provide both an opportunity to access funding and a way to retain some control, even though the level of investment was less than could be achieved through stock transfer.

Over the next decade, the ALMO model gained widespread acceptance as a means of successful stock investment and also saw a significant increase in tenant participation and involvement. Inevitably it had its problems – and failures – and in a small number of instances relationships between the local authority and its ALMO were fractured or the arrangement failed to deliver the performance expectations of the sponsoring authority.

The first ALMOs went live in 2002, and to date there have been six rounds of ALMO funding. While the initial rounds capped spending on individual properties, later rounds permitted a more flexible approach to stock investment as a whole.

Local authorities yet to complete their Decent Homes programmes are now working through the implications of the October 2010 comprehensive spending review and the expected detailed announcement on housing revenue account (HRA) reform. Both will have a significant impact on how local authorities approach future stock investment and the models for delivery

Despite this uncertainty, it is clear that most local authorities already have an established view on both the ALMO model in general and their own ALMOs in particular. In a recent Inside Housing survey (27 August 2010), respondents who worked for a council with an ALMO were asked about its future over the next three to five years. Nearly half said they believed their management organisation would be brought back in-house. Thirty-six per cent said that their ALMO’s services would be outsourced and only 18 per cent believed it would continue to run as at present.

These findings stand in stark contrast to the widely acknowledged success of the ALMO model. It is important, therefore, to understand why there is such doubt about its continuation post-Decent Homes – particularly since many ALMOs will be coming to the end of their management agreements over the next few years.

This research was designed to better understand the policy drivers and key objectives that are affecting local authority decisions on how best to proceed with their housing programmes and the future role (if any) of their ALMOs. To do this, the research reflects on the perspective of a number of ALMO parent local authorities. It covers a number of local authorities from funding rounds 1-6, ranging from those who have chosen to bring their ALMOs back in house to those that now see them as continuing to exist with a wider delivery role and some that are yet to decide.


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The report also outlines the case, as articulated by the National Federation of ALMOs, for considering the ALMO model as a vehicle for the future.

The research offers some observations for all who are considering future stock options and some recommendations for both ALMOs and their parent local authorities, including those that may already have made a decision about the future of their ALMOs.

4. The role of the ALMO

All of the local authorities interviewed for this report confirmed that the key driver for the establishment of an ALMO was access to funds. Many had already carried out a stock options appraisal and concluded that without a significant injection of additional resources they would not be able to maintain their homes to the Decent Homes standard required by government.

A number of authorities had considered stock transfer. For some, the experience of a failed stock transfer influenced their decision to set up an ALMO. In other cases, the ALMO arrangement was regarded as part of a basket of solutions for their stock. In one particular instance, this included PFI for some sheltered accommodation and the wholesale regeneration of two estates for which Decent Homes investment alone would be inadequate.

In some cases, this initial motive for setting up an ALMO influenced the ongoing perception of the ALMO by the parent authority. One respondent said:

“All three options [excluding retention, for which there was no money] were like a bribe. This was the one that was most palatable, but our members have never really liked it.”

In other cases, the ALMO’s subsequent achievements created a different perspective. For example, one local authority interviewee said:

“Access to funds opened up the possibilities for us to do much more with our housing service and achievement of three stars would probably not have happened without the ALMO.”

The potential for improvement of housing management services was another key driver for local authorities in setting up an ALMO, as was greater resident involvement and accountability to tenants/leaseholders. For many, having focused and dedicated resources for housing management was seen as a real benefit and a major selling point for tenants in achieving a positive vote for the ALMO.

One local authority we interviewed took the opportunity to set an improved standard for its housing stock that included renewal of roofs, communal areas and environmental improvements, as well as stock improvement. For a number of local authorities, the focus on increased resident participation, while not necessarily an initial driver, was regarded as an important benefit of the new arrangements. According to one respondent:

“It required us to think again about the involvement of tenants in decision making and having tenants on the board of an organisation focused on service delivery has been a good thing.”


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Although access to funding, and improving services, were the main drivers for setting up an ALMO, some authorities have subsequently explored a wider role for their ALMOs.

Interviewees from these authorities referred to the 2006 government review of ALMOs beyond completion of the Decent Homes programme, which suggested that local authorities consider the following options:

ALMOs carrying on as they are by extending the current agreements ALMOs taking on a greater range of responsibilities on behalf of the council ALMOs using trading powers to offer a range of services to other organisations mergers or consortia arrangements between ALMOs changing the management arrangements integrating ALMOs with other local authority work, changing ownership

Some authorities have indeed supported their ALMOs in bidding for a social housing grant, which first became available from the Housing Corporation in 2008 and was subsequently subsumed into the HCA’s local authority new build programmes of 2009. Indeed, six ALMOs were awarded investment partner status and received new build grants totalling over £8 million to deliver 130 homes. A further 17 were awarded investment partner status and were eligible to prepare bids for funding.

Over time, authorities may also wish to consider new options for the future of their housing service – such as, for example, the community ownership model currently being developed by the NFA and a mutual model that is being explored by the authority and the ALMO in Rochdale.

5. ALMOs as a contractor

In terms of delivering Decent Homes, the ALMO model has been an undoubted success. This is widely acknowledged by local authorities. Although there are a number of local authorities that are still to achieve the Decent Homes standard for all of their stock, the vast majority that have set up ALMOs have either achieved the standard or are well on their way to doing so.

On improving housing management services, ALMOs have made significant strides. There are now 22 three-star rated ALMOs and a further 39 two-star organisations.

Tenant satisfaction and engagement has also generally increased. All respondents in our research agreed that the ALMO arrangement enabled a clear focus on the quality of service to tenants. “By having an organisation that was just focused on delivery, there didn’t need to be any distractions,” said one interviewee. “Focusing on getting two stars to access the money had a galvanising effect on how we approached our housing management,” said another. Even where the arrangement initially did not deliver to expectations, authorities felt that the focus on delivering improved services meant they could identify more easily the issues and the necessary remedial action.

However, our interview feedback and other reports suggest that experiences have varied. Examples include:

Ealing, where historically, there were difficult issues around governance and

accountability. Stockport, where the ALMO has been identified as the local authority’s key

development partner – and was one of the first ALMOs to receive grants to undertake new build activity


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Redbridge and Hackney, both of which had poor initial inspections, but have subsequently achieved two-star ratings for their housing services

Cornwall County Council, where Carrick Homes has delivered exceptionally high levels of tenant satisfaction

Local authorities’ perspectives on their ALMOs’ performance have been influenced by how well the governance and accountability arrangements have worked. This has been underpinned by the effectiveness of the working relationships between the authorities and their ALMOs and the councils’ views on the value for money delivered by the ALMOs.

5.1 Governance and accountability

ALMOs were set up with a management agreement between the ALMO and the parent local authority. In varying degrees of detail these agreements set out performance expectations and levels of service. These formed the contract between the client and its agent, with responsibility for management resting with the ALMO. In practice, however, it was not always easy to draw a clear line on responsibility, particularly when drawing a distinction between strategic and operational issues. All of our interviewees indicated that getting this right was a key factor in a successful relationship between the ALMO and its parent local authority.

In selling the model to both councillors and residents, the fact that ultimate responsibility remained with the council was seen as both a virtue and a burden. “The fact that we could say that you were still a council tenant was important for our tenants,” one respondent commented. However, another commented that “there was little point in saying it was the ALMO’s fault if things went wrong and it was nothing to do with us because the buck still stopped with the council.”

5.2 Working relationships

It was acknowledged by a number of authorities that the adjustment to a different, arm’s-length form of governance was not easy for councillors or for officers. It also did not help if the ALMO defined itself as independent from the council and focused on this independence. This was most significant if the ALMO was felt to be setting different priorities from those of the council, as occurred initially in Westminster and Salford. Both the initial Decent Homes priorities and the discussions about what should happen subsequently have been difficult for a number of parent local authorities and their ALMOs. In Salford, the current successful relationship has been attributed to a shared understanding of roles, responsibilities and priorities by the ALMO’s senior management team that has not always been in place.

The most successful partnerships have hinged on the relationship between the board and chief officers of the ALMO and the chief officers and elected members of the local authority. It is unsurprising, therefore, that the chief executive of Carrick Homes has been seconded onto the senior management team at Cornwall County Council or that the London Borough of Hackney is consulting on an arrangement for the Hackney Homes ALMO chief executive to also be on the management team of the council. In both cases relationships are strong and there has been early and sustained agreement on priorities.


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Success also helps to build or reinforce positive relationships. For example, in Hounslow the ALMO’s achievement of three stars and its successful piloting of a HCA funded new-build programme has positively influenced the view of the council in thinking about its future approach to service provision and the ALMO’s role within it. Similarly, it is no surprise that our research has confirmed that poor delivery has adversely affected the view by some local authorities of their ALMOs, in a limited number of cases.

The Councils with ALMOs Group and the National Federation of ALMOs have agreed some broad guidelines for parent local authorities and ALMOs to follow in order to maintain good working relationships. Although most of the document could be regarded as common sense, it is useful for both parties to agree such principles of engagement. The CWG/NFA guidelines are attached at Appendix 2.

5.3 Value for money

In assessing value for money (VFM) it is important to take a balanced approach and to make use of all available in-house and comparative data. The variance in potential VFM assessment is striking. Several London boroughs have cited savings of up to £400,000 in bringing their ALMOs back in-house but a forensic assessment by Cornwall County Council put the savings at only £30,000. Cornwall structured its assessment as follows:

the financial costs as a direct consequence of the ALMO arrangement the financial costs of maintaining an improved management service (which might

therefore still be retained in any different arrangement) the cost of traditional reactive management

6. ALMOs and tenants

All of the respondents to our research confirmed that, in their view, tenant involvement and engagement had improved under the ALMO arrangements. Even those who had already established tenants’ forums and involvement panels prior to setting up an ALMO felt that additional benefits had been achieved.

The exercise of achieving either two or three stars was seen to have been very positive for tenant engagement. “In getting to three stars, the ALMO has really got us to think again about the way that we engage with our tenants,” said one interviewee.

Where arrangements were felt to be less effective, this tended to be as a result of lack of clarity about the roles and responsibilities of the ALMO, the local authority and the tenant. An example of this can be seen in the case of the tenant who, having exhausted the ALMO’s three-stage complaints procedure and complained to the council, was advised that he was now at stage one of the council’s three-stage procedure. This was frustrating for the tenant and equally frustrating for the ward councillor acting on the tenant’s behalf, who felt ultimately responsible for the bureaucratic complexity involved.

6.1 Future consultation

All of the participants in our research said that they would engage with tenants and leaseholders in their deliberations on the future management of their stock to the same extent as when setting up their ALMO arrangements. This ranged from ‘tests of opinion’ to a full ballot.


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It is a prerequisite of any ALMO termination that a local authority should consult with tenants and leaseholders under section 105 of the Housing Act 1985, which requires an authority to inform tenants about its proposals, enable tenants to make their views known to the authority and consider the representations it receives from tenants.

Current ALMO guidance from the Department of Communities and Local Government (Review of Arms-Length Management Organisations, June 2006) further states that a test of opinion should be undertaken prior to the transfer of housing management from an ALMO back to the parent local authority “where a test of opinion was undertaken before the ALMO was set up”. The CLG makes it clear that it expects any consultation on a significant change to the parent local authority’s housing management arrangements with the ALMO to be “as good as those which were undertaken before the setting up of the ALMO”.

This should be regarded as good practice and adhered to by local authorities.

There have been suggestions that some local authorities have taken decisions on whether to bring the management of their stock back in-house on the basis of political considerations alone. This would seem to be contrary to CLG guidance and to the spirit of a tenant-centred approach to service delivery.

7. The future of ALMOs

For those authorities that have already achieved Decent Homes standards, the question arises: what next? How do local authorities sustain standards in the future? How do they tackle the challenge of improving the wider external environment if they have not done so as part of the Decent Homes programme?

For authorities that have not yet met the Decent Homes standard for all of their stock, where will the resources to do so come from – particularly given the intense pressure on council-wide spending?

The authorities interviewed for this report were at different stages in carrying out further stock options appraisals. Some were embarking on a full review, while others were updating their original appraisals. All had carried out some form of desktop financial appraisal to consider the impact of the previous government’s proposed housing revenue account (HRA) reforms on their ability to deliver stock investment in the future.

All these authorities were also facing significant pressures on the general fund. Where they were considering retaining their ALMOs, or were yet to make a decision, there was an increased expectation that the ALMOs would contribute to savings and efficiencies required by the local authority as a whole, not just to the HRA – for example, bearing costs that might previously have been in the general fund (such as anti-social behaviour work or neighbourhood wardens).

Notwithstanding the outcome of the October 2010 comprehensive spending review or


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the ability of local authorities to now bid for decent homes directly, the full implications of which will become evident over the coming months, there appear to be three options3 for a local authority’s future approach to its landlord’s functions4:

bringing the management of stock back in-house and running a new ‘enhanced’

housing function within the council maintaining the ALMO arrangement for the provision of housing services – and in

some instances exploring a wider role for the ALMO stock transfer

There is also increasing consideration of other models to deliver services, including the sharing of services. For example, the London boroughs of Camden and Islington’s proposals for a shared chief executive, and the proposals from Kensington and Chelsea, Westminster and Hammersmith and Fulham to share services. An interesting dimension here is whether there is scope for the ALMOs in Westminster and Kensington to share services with each other and with the housing service that is being taken in-house by Hammersmith. Elsewhere, some authorities are actually establishing new ALMOs – such as Welwyn and Hatfield and the four authorities in East Kent that are developing a ‘super ALMO’ based on shared service delivery.

In the case studies – see Appendix 1 – the key drivers in local authority thinking about their landlord function arrangements and approach to future stock investment were cost, efficiency and value for money. Almost all of the respondents in our research referred to the perceived additional cost and potential duplication of running an ALMO arrangement.

“If you have two sets of chief officers, finance people and communications people, you can see the savings you can make immediately,’ one respondent commented, while warning that ‘we should be careful of throwing the baby out with the bath water. There is definitely room for sharing of services, but you do not want to lose the benefits of the focus on tenants and service delivery that the dedicated ALMO arrangement has brought.”

This was a worry shared not only by some of our interviewees but also by other local authority housing chief officers with whom we have spoken. Maintaining the gains made in service delivery and improved resident satisfaction will be challenging for local authorities and ALMOs alike in the current environment. With the impending demise of the Audit Commission and the Tenant Services Authority, and with the successor to the latter, the Homes and Communities Agency, expected to refocus on economic regulation rather than tenants and local accountability, local authorities will need to consider how best to ensure a focus on performance. As one respondent commented:

“We have made great strides in getting better accountability for our services to tenants and residents through the ALMO. We have to work out how to replicate that scrutiny and governance arrangement when we bring it back in house.’”

We found evidence of some longer-term thinking on maintaining and enhancing tenant involvement even where the ALMO is brought in-house. In Hillingdon, for example,

3 In one instance there had also been consideration of outsourcing the management arrangements to other providers, including the private sector. However, there was no evidence to suggest that this was a widespread approach. 4 A fourth option may emerge in early 2011 when the NFA publishes the findings of its research into community ownership models.


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where the local authority brought its ALMO in-house in October 2010, the council has already established an involvement framework and discussions are being held with tenants and leaseholder representatives as part of its service review. The authority recognises that “the council will have to be able to demonstrate that the empowerment structure is real and that services are being managed with tenant involvement securing the outcomes that tenants want.” Hillingdon is currently looking at a new approach to scrutiny, which goes beyond the traditional tenants’ federation and will seek to ensure greater engagement with younger and older people as well as those from ethnic minorities.

The question of added value was raised by a few interviewees. “We now tell the ALMO what to do and it does it. Fine, but what we could do with is it adding ideas to our future strategies,” said one. ALMOs such as Stockport Homes and Bolton at Home have done just that, and there is scope for the ALMO sector to learn from these ALMOs in making offers to parent local authorities.

An example of the potential for the wider role of the ALMO can be found in Salford, one of our case studies. The ALMO, Salix Homes, is the development agent for the Manchester/Salford Housing Renewal Pathfinder, acquiring properties, leading on renovation and regeneration strategies and coordinating regeneration activities of other public agencies. It is seen as a key partner of the authority, leading on an integrated public service model for the city region.

In the current operating environment, the advantages that ALMOs can offer their parent authorities include:

things that the local authority doesn’t have the powers to do retaining assets in the local authority family use of a charitable arm a combination of some or all of the above

One example of the first of these might be the provision of intermediate renting schemes. These could facilitate assured shorthold tenancies at rents below market levels but higher than those set under rent restructuring. Brent Housing Partnership is operating one such scheme for Brent Council.

An example of the second might be for an ALMO to undertake an estate regeneration, including taking on the management of all the old, new and intermediate stock but with the assets still ultimately owned by the council. By retaining ownership the council would have more influence on future management than if it passed to a housing association.

However, if an ALMO is given a wider role or seeks to become a LSVT association, “it should not become just another housing association,” as one respondent told us. It should build on its track record and understanding of the local authority, its demography, its strategies and its challenges. It should define its unique selling proposition as the quality of its service to tenants and its focus on communities and neighbourhoods. In a market that will have many possible providers but also increasingly scarce resources, this will help to give it a competitive advantage. It should see itself as a ‘contractor plus’, more than just a traditional contractor.

Of course, as we have already noted, there is a longer term picture that has yet to become entirely clear but which will have a key impact on local authority decision


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making.

The important point for all parties to recognise is that HRA reform is a fundamental change, which means that neither retaining the ALMO nor bringing the service back in-house is simply maintaining the ‘status quo’. Key aspects of this reform, likely to be confirmed in January 2011, are:

local authority housing-related borrowing will be limited by the government and,

depending upon the headroom flexibility available to the authority, further investment may require off-balance sheet solutions

depending upon future interest rate levels, and notwithstanding the limit on borrowing, there may be scope to reconfigure debt through active treasury management so as to create capacity to invest

local authorities may have scope to set higher rents for new lettings – subject to the housing benefit cap under the ‘limit rent’ arrangements which, it appears, the current government wishes to retain at present

authorities may not now have full access to future right to buy receipts, as promised by the previous government, but are likely to be able to retain receipts from other sales and reconfiguration of their stock

These and other aspects of the planned reform will place a high premium on local authorities having a business-like approach to the management of their housing assets and the income from them (which will no longer be determined by the annual HRA settlements). Moreover, while a local authority may in future be highly restricted in its scope for further investment in improving its estates or in new build, an ALMO potentially provides an option for bringing in additional investment, if it can be reconfigured to do so outside public borrowing constraints. Authorities will need to consider, as the details of these changes become clearer, whether an in-house service or a retained ALMO is best placed to take advantage of the new opportunities that may become available.

8. The case for retaining the ALMO – National Federation of ALMOs

To provide balance, the National Federation of ALMOs was asked to set out its case for retaining the ALMO. Gwyneth Taylor, Policy Director at NFA, writes:

Although the ALMO sector is still very new – with the longest established ALMOs being only eight years old in 2010 and the newest going live only a few months before this report was written – questions about the future of ALMOs beyond the Decent Homes programme have been posed for some time. The establishment of the coalition government in May presented the sector with a number of challenges and opportunities. As resident-led bodies working within their communities ALMOs are well placed to help the new government deliver its localism agenda. However, while some local authorities appear to be embracing the concept of engaging with their customers others are considering with trepidation the potential impact of swingeing cuts in public spending and, in some cases, their response appears to involve a move towards greater centralisation and control.

While it is right that deliberations about the best way to provide efficient, value for money services should take place at government level, it is important not to lose sight of what


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has been achieved by the sector and what more ALMOs can offer their parent authorities, particularly at a time of acute restrictions on public spending. We recognise that some councils and their tenants may want to go down different routes in the future but would argue that the process for doing this should be robust, transparent and fair, and that tenants should be fully involved at all stages. ALMOs aren’t just successful at improving homes; they empower tenants, enhance quality of life and build better, more cohesive communities. ALMOs have worked hard to deliver services and help support the most deprived members of our communities at a time of unprecedented economic turbulence, while the Decent Homes programme has delivered considerable benefits in the areas of health, crime and disorder, environmental improvements, community cohesion and the local economy. ALMOs are tried and proven delivery vehicles that offer the flexibility to adapt to local circumstances. As well as the ALMO Decent Homes programme having been an unqualified success in delivering major programmes on target and within budget, the sector has also outperformed traditional retained stock local authority housing across the board in service improvement, tenant empowerment and efficiency savings. ALMOs, in the main, are managing the most intractable council housing stock in terms of its age, type and repair history. For those councils that wanted to keep their stock in public ownership but were unable to achieve the Decent Homes standard because the condition of the stock and the resources available to them pushed it out of their reach, ALMOs were their best option to obtain additional funding. For most councils, this was the only rationale for establishing an ALMO. The other potential benefits were not really considered, at least initially. Now, however, we have councils considering establishing new ALMOs because they view the concept as a better way of managing council housing at the same time that some councils that already have ALMOs are considering winding them up once the Decent Homes programme is finished. It is particularly exciting that this year Welwyn Hatfield Community Housing Trust went live as the first ALMO not linked to the Decent Homes funding and with a particular remit for community development. In East Kent, meanwhile, the proposal to establish a single ALMO managing the stock of four district councils could open the way as a model for future shared services between councils to deliver greater efficiencies while maintaining high levels of service. So why is there this apparent anomaly in how some councils view ALMOs? It is all too easy, at a time of acute financial crisis, to look at short term options that may promise savings but may not necessarily achieve those objectives. The majority of ALMOs have been subject to year-on-year freezes and cuts in their management fees and are now delivering a better, more comprehensive service than when it was provided by local councils. The focus of their boards and management teams is entirely on delivering the best possible service for the least cost to tenants and councils. Those councils that bring their ALMOs back in-house may not necessarily be able to continue to sustain the service improvement and efficiencies at the same level. There is substantial evidence that ALMOs outperform traditional local authorities in delivering the housing service. A recent analysis by Professor Hal Pawson5 of service improvement in local authorities over the past six years showed that while there had

5 Analysis of English local authority housing management performance 2008/09, February 2009, Hal Pawson.


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been a general improvement across local authorities, the improvement in ALMO-managed stock has been greater across all key indicators and a disproportionate number of ALMO-managed authorities were rated as top performers. These findings are also backed up by comparison with Audit Commission inspections and Ipsos MORI findings on tenant satisfaction6. Moreover, HouseMark benchmarking data has demonstrated consistent year-on-year performance improvement by the ALMO sector. The involvement of tenants in making decisions about how their service is delivered has been a key factor in the effectiveness of ALMOs and a major concern about those ALMOs that go back in-house is the extent to which tenants could become disenfranchised in the future. If ALMOs are wound up it is not just the better management that could be lost; the wider beneficial impact ALMOs have had on communities may be broken too. The Decent Homes standard was only ever a halfway house, not a final destination. Once the stock has been brought up to standard there remains a major potential role for ALMOs in estate renewal and regeneration of the current council housing stock and in delivering locally tailored community services.

One of the benefits of the ALMO structure is its ability to be adapted to local circumstances. The NFA has always recognised that ALMOs are likely to diversify according to local needs. However, we believe that it is important for councils to carry out robust financial and risk assessments and to fully involve their tenants in deciding the future of the service. It is apparent that, in comparison to the process involved in setting up an ALMO, some local authorities have carried out no real consultation or proper consideration of the options available before making a decision on winding it up. It is an anomaly that in the case of ALMOs tenants are being given no real say over the management of their homes while councils that want to transfer their stock are legally required to carry out full stock options reviews and ballots of tenants. This is why the NFA has concluded that the same kind of statutory protection should be offered to tenants in ALMO-managed property that applies when councils are proposing to transfer their stock.

9. Conclusions

The ALMO model has been successful and has largely delivered on its core objectives to improve the quality and condition of local authority stock and to improve housing services to residents and tenants.

However, the perspective of local authorities on the model is mixed. Some see the arrangement as requiring an ALMO to deliver its core tasks and then finish. Others see the model developing and even being extended into other services. For yet others the logical next step is transfer. Wherever the local authority is in its decision making about the future of its landlord function and its approach to stock investment, there are a number of observations and recommendations that can be made. These are set out in the key messages at the beginning of this report.

6 Housing Frontiers 2008 – An analysis of local authority tenant satisfaction data, June 2008, IPSOS MORI.


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Perhaps the most important message, though, is that local authorities should fully reflect on the lessons of the ALMO experience in delivering a dedicated focus on performance and improved services to tenants and leaseholders. There is much that can and should be learnt and this experience should not be overlooked when deciding upon future approaches to stock investment. The government is currently looking to new partners and new solutions to meet both the affordable homes crisis and the challenge of future stock investment. Those local authorities and ALMOs that have prepared and learnt the lessons from the experiences of the ALMO model over the past decade will be better placed to respond both quickly and effectively to the opportunities and the challenges that are certain to arise.


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Appendix 1: Option appraisal case studies Below are case studies that set out the drivers for four different local authorities in reaching decisions on the future arrangements for their landlord function. The information is taken from public documents, including the authorities’ cabinet reports. Although they are at differing stages of their deliberations and their conclusions are different, they each recognise that their landlord arrangements must deliver for future stock investment needs and for current and future housing service improvement and tenant engagement. The wider question, therefore, is whether the deliberations are sufficiently robust. This question concerns those who are proposing retention of their ALMOs as much as those who are proposing to bring the management arrangements in-house.

Case study 1: Gloucester City Council Retaining the ALMO and extending the management agreement Summary Gloucester City Council is the administrative centre for the county of Gloucestershire Gloucester is the most densely populated district in Gloucestershire – there are 111,300

people living in the city The council owns 4,739 properties, providing housing for 10 per cent of the city’s

population The council established an ALMO, Gloucester City Homes (GCH), to manage these

properties in December 2005 The ALMO has delegated responsibility for providing housing management and

maintenance services, receiving a management fee for this service. It manages the Council’s £12.25 million revenue budget and a capital programme of £3.9 million

In June 2007 the Audit Commission awarded GCH a good two-star service, which has promising prospects for improvement

By April 2010 GCH had completed 85.5% of its Decent Homes programme; it aims to complete 90-92% by the year end (although this is very much dependent on the availability of funding)

Next steps Following the two-star award the council affirmed its commitment to allow GCH to

develop as an independent and expanding provider of social housing on its behalf As part of the council’s wider strategic aim of becoming more of an enabling authority, it

instructed GCH to develop its independence as an autonomous company. GCH was given a clear mandate to:

o excel in comprehensively managing the council’s housing stock and its neighbourhoods

o deliver safe, mixed, sustainable and decent communities and environments o demonstrate cost effective performance in its activities o create opportunities for additional revenue sources by expanding/sharing services

with other housing providers o take all appropriate opportunities to improve existing, acquire additional and build

more affordable homes The council supported a policy of taking all reasonable steps to enable GCH to stabilise

its business in order for it to prepare for and operate within whatever future freedoms ALMOs may be awarded beyond Decent Homes, and to evolve into a different type of organisation


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This decision was predicated on the council and its tenants being satisfied that the new arrangements would be mutually advantageous

Earlier this year the decision was taken by the council to commit its medium/long term future to the ALMO by extending its contract for a further 5 years

This move will, it is hoped, provide the ALMO with the necessary security to build on its strengths

Moving forward, Gloucester City Council and Gloucester City Homes have set up a working group chaired by the ALMO and including residents to explore a wider scope and remit for the ALMO.

Case study 2: Oldham Metropolitan Borough Council ALMO becomes an LSVT housing association Summary Oldham is one of the largest local authority areas in Greater Manchester Oldham’s population is 219,000 of which 13% is from ethnic minority communities In 2000/01 the council commissioned a detailed housing stock option appraisal to

assess the most effective way of ensuring the necessary levels of investment to improve and maintain its stock in future years. This led to the decision to set up an ALMO

April 2002 – the ALMO, First Choice Homes Oldham (FCHO), was set up by the council to undertake its housing service landlord functions for its stock of 18,000 homes

November 2005 – the Audit Commission re-inspected FCHO and gave it a two-star rating with promising prospects for improvement

In 2007/08 another detailed housing stock options appraisal was undertaken, which resulted in residents voting overwhelmingly (86% in favour) to transfer the entire stock to a housing association

November 2008 – the council cabinet endorsed recommendations from the options appraisal to transfer the housing stock to a newly-formed and locally-based housing association, also called First Choice Homes Oldham

It is estimated that by the date of transfer there will be 11,900 dwellings to transfer The transfer will see £149 million invested in the homes over the next five years Key elements of the decision Oldham Council recognised that despite the considerable success of FCHO in delivering the Decent Homes programme, there remained concerns regarding the sustainability of the housing revenue account and the council’s ability to fund future capital investment in its housing stock. Role of the tenants January 2009 – the council, in partnership with FCHO, established a group of around 30

interested tenants to form a tenants’ forum to develop the ‘offer document’ Specialist independent advisers were selected by a tenants’ panel to assist with the

process An Oldham transfer panel (OTP) was set up to oversee the development of the offer

document and the process leading to a stock transfer The OTP included three members of the existing FCHO board and elected member

representation from the three main political parties


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Financial impact of the stock transfer The borough’s housing stock was valued at 1 April 2010 as part of a 30-year business

plan to deliver the promises and improvements set out in the offer document The estimated purchase price is £4.2 million, subject to change prior to transfer A positive valuation means that FCHO will not be looking for the government to provide

‘gap funding’ or ‘dowry’ payments, which have been available in recent years to support negative valuations.

At £4.2 million, this valuation is just sufficient to pay the council’s cost of setting up FCHO as a housing association and there will be no receipt to the council as a result

Any balance of the purchase price over the set-up costs would be used by government to reduce the amount of housing debt that it will need to write off

The government, through the Homes and Communities Agency, has validated the draft offer document and is satisfied that the council’s offer is deliverable

Next steps The housing stock transfer project is in the final stages and the aim is to complete the

transfer to an independent FCHO by the end of the 2010/11 financial year From the transfer day onwards FCHO will launch a very large housing investment

programme, amounting to £149 million in the first five years and £809 million over 30 years

The transfer is an extremely complex project requiring the contribution and combined agreement of the council, FCHO, tenants, funders, the government, the Homes and Communities Agency (HCA) and the Tenant Services Authority (TSA)

The final stages have been underway since a very positive tenants’ ballot result in April 2010, endorsed by the council in June 2010

The final decisions will be made by the council in November and/or December.

Case study 3: The London Borough of Hillingdon Bringing the service back in-house Summary The London Borough of Hillingdon (LBH) is in west London and has a population of

252,400 There are 101,798 homes in Hillingdon, of which 10,769 (10.6 per cent) are council

owned, 5,958 (5.9 per cent) are owned by RSLs, 83,644 (82 per cent) homes are privately owned and 1,222 (1.4 per cent) are owned by other public sector bodies

Hillingdon Homes (HH) was established in 2003 following the positive outcome of a tenant and leaseholder test of opinion

The LBH’s Decent Homes (DH) funding allocation was in the region of £60 million In September 2007 HH was judged to be a good two-star service with excellent

prospects for improvement HH successfully delivered the DH programme a full two years ahead of the 2010

deadline The LBH cabinet formally approved the decision to go out to a tenant and leaseholder

‘test of opinion’ in September 2009 (conducted during December 2009) Following a positive outcome to that consultation, the final sign-off from cabinet to bring

the service back in-house occurred in February 2010 The LBH is the first council to have decided to return its housing services from an ALMO


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It is worth noting that whereas the government provided local authorities with template documentation and guidance on principles and processes to set up an ALMO, there is no such information currently available on how to wind up an ALMO

Key elements of the decision On 1 May 2008 Hillingdon Council agreed to extend the management agreement with

HH for a second term of five years subject to the variation of the contract to allow for a break clause

The clause allows the council to terminate the agreement after three years by serving a six-month notice

The purpose of this clause was to allow the council to judge the performance of HH on a more frequent basis. It also provides the council with the flexibility to respond to a changing housing landscape

By returning the landlord service to direct control the council will be pursing its objective of increasing the speed of improvements to the landlord service

While it is acknowledged that the ALMO vehicle has enabled the council to achieve the DH standard and improve tenant and leaseholders’ satisfaction ratings, the council also states that there is no overriding strategic value in continuing to maintain this method of operating

Also questioned is the evidence that the ALMO vehicle in itself has been the significant factor in improved delivery

The council also highlights the ‘significant’ financial benefits to tenants of returning the service to the authority. Potential savings in LBH from the cost of governance of the ALMO alone are likely to be in excess of £300,000 per annum

Further savings are expected to result from the ‘rationalisation of opportunities’ that would be available to a single entity, including the reduction in duplicated control mechanisms and general economies of scale

Next steps A report to the council’s cabinet in September 2009 recommended that the council

establish a mechanism to take the service back in-house The report outlined the key elements of the process of re-engineering the ALMO

following the same steps with regards to resident engagement and consultation that were used to establish it in the first place

Using guidance contained within the government’s Review of ALMOs published in June 2006, LBH prepared a business case that demonstrated the benefits of its proposed course of action in terms of cost, service delivery and resident support

For LBH the tenant consultation involved public meetings and an official ‘test of opinion’ Tenants were also given the opportunity to appoint an independent advisor or ‘tenants’

friend’ As well as consulting with tenants there was also consultation with staff/unions and

TUPE arrangements were negotiated Other consultation involved the consideration of all the constitutional issues (standing

orders, delegations and so on) LBH appointed a project manager to oversee the consultation and transition Although there is no legal requirement imposed on the council to consult with

leaseholders on the proposed changes, it was deemed advisable to do so A full tenants’ ballot was not undertaken as the council satisfied the government that a

variety of consultation mechanisms had demonstrated it had sufficient support from the resident body to proceed

Tenants are content and support the empowerment structure


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The HH board and its senior management team continues to work to ensure a smooth transition back to the council

The ALMO formally returned to the authority on 1 October 2010

Case study 4: Salford City Council Salix Homes acting as the local authority’s housing development company Summary Salford City lies to the west of the Greater Manchester area and includes the towns of

Swinton, Irlam, Eccles and Walkden Salford is home to 221,300 people The council established the ALMO, Salix Homes, in July 2007 to manage over 10,000

homes (including 311 leaseholders) and deliver regeneration services and programmes in central Salford and Beech Farm

In May 2010 Salix Homes (SH) was inspected by the Audit Commission and found to provide a good (two star) housing service with excellent prospects for improvement

It replaced a former ALMO, New Prospect Housing The council also transferred around 15,000 homes to a new registered provider in the

western part of the city (City West Housing Trust) The council has also developed a private finance initiative (PFI) to improve 2,000 homes

in the Pendleton area of central Salford The ALMO client manages the PFI area up to the transfer deadline in 2011, after which

the ALMO stock will reduce and it will manage the remaining 8,000 council homes. The Audit Commission award enables SH to access £70 million of government funding,

which will be used for investment in homes and neighbourhoods across central Salford and Swinton over the next five years

The ALMO is lead agency for the Manchester/Salford housing renewal pathfinder, which includes acquiring properties, renovation and stock renewal

It leads on behalf of the council in neighbourhood coordination of relations with the police and other public agencies

It will also act as managing agent for the council’s 101-home new build programme Key elements of the decision The authority is yet to decide upon the future of the ALMO. However, it believes the ALMO has been successful and is therefore looking at what needs to be done to enable it to grow further and develop its role. At this stage reverting to the authority managing the stock is seen as a regressive step.


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Appendix 2: Guiding principles in relationship between ALMO and council: Councils with ALMOs Group/National Federation of ALMOs 1. Act only with a view to finding a practical solution that works for both sides

Whatever the differences and difficulties, fundamentally we are on the same side; we want the same things and need to concentrate on finding solutions, not making things worse. The ALMO must always remember it works for the council, which is democratically elected, and it is a delivery vehicle owned by the council. The council must remember its obligation to deliver quality services to tenants.

2. Treat each other with respect

Officer and member relationships at all levels need to be based on respect for each other as individuals and in the roles they are carrying out, recognising the different views, pressures and perspectives that each may bring. ALMOs need to understand a council’s decision-making structures; councils need to understand these structures within the ALMO and have access to board papers.

3. Maintain communication at all levels

People engaging with each other comprise the starting point to the resolution of any issue. Given the complexities of the ALMO/council relationship, this needs to take place at a number of levels and in a way that is clearly defined and agreed. This includes operational managers, strategic leadership and members/board. Regular schedules of meetings at appropriate levels throughout the organisations need to be agreed.

4. ALMOs to accept as legitimate council challenge to improve performance and

therefore be willing to participate positively in scrutiny

ALMOs are performance-driven organisations and therefore welcome challenge to improve, although scrutiny should be proportionate and at the appropriate level.

5. Have a clear financial agreement which is fairly and openly negotiated each year

Tensions around finance have understandably been identified as the biggest source of conflict between organisations. A clear agreement about the broad principles on which this is negotiated each year should be formally agreed by both the council and the ALMO. Then, each year, an open and fair discussion should take place about how this works out in practice. Making sure that this debate starts early, is open and effective helps to minimise any conflict.

6. Be clear what operational independence means in your relationship

Most ALMOs and councils think ALMOs should be operationally independent but conflicts can arise if they do not understand or agree what this means. Where authority is delegated to an ALMO it should be allowed to get on with it, while recognising that the council is ultimately responsible. It may take some discussion to get to a shared understanding of what operational independence means. This is critical and can help all parties to both understand what it means and comply with it.


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7. Accept there will be tensions, have a process to deal with them, including provision for outside advice, but don’t let them fester

A mature relationship will understand that strategically and in the long run, ALMO and council interests are the same, but that on individual issues, day-to-day operations or joint working, there will be tensions. If there is communication to deal with them and a process that is clear, transparent and fair, these tensions/differences can be resolved and not be allowed to skew the wider relationship. The worst thing that can happen is that these issues are left unresolved and start to sour the whole relationship.

8. ALMOs to appreciate councils’ wider strategic aims that relate to housing and use

their housing role to contribute to this wider agenda. Councils need to facilitate and maximise this contribution

This allows a council to require approaches from the ALMO that contribute to its wider objectives and allows an ALMO to bring its resources and skills to the wider partnership working of the council. If this works well, it can enhance both the service delivery and the reputation of both organisations.

9. View the relationship as a partnership, not a client/contractor relationship

Successful ALMOs are those that are driven from within. Defining the relationship between an ALMO and the council as that of a client/contractor limits its success and denies the significance of governance, tenant involvement and the responsibility of the ALMO. Equally, the ALMO must appreciate that this partnership operates in a changing world and new pressures on councils, changing politics, priorities and resources, may mean changes in the way the relationship works. Resolving such issues must be done in a spirit of partnership, with flexibility and a willingness to change.

10. Fundamental changes to the use of an ALMO should be determined by what is in

the best interest of tenants, with their views being central

When making decisions or looking at future options, bear in mind that the core function of the ALMO is the same as the core function of the council, and that is to make decisions that are strategically in the best interests of tenants. This should be the guiding principle in all strategic decision making in relation to the management of the council’s housing stock.


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Appendix 3: About HouseMark HouseMark is the performance improvement subsidiary of the Chartered Institute of Housing and the National Housing Federation. Our work encompasses four main areas: benchmarking of cost, performance and resources good practice – such as this publication our Procurement for Housing collective purchasing scheme consultancy Our benchmarking database covers direct costs, overheads, performance indicators and staff utilisation and supports scenario modelling. Our methodology allows comparison between ALMOs, authorities and housing associations. We work with 870 member organisations, drawn from across the UK, including: 88 of the 103 retained stock authorities in England all 68 ALMOs all ALMO parent authorities Each year we host three major conferences: Retained stock authority chief officers (in association with the Association of Retained

Council Housing) ALMO chief executives (in association with the National Federation of ALMOs) ALMO finance directors (in association with the National Federation of ALMOs)

Our non-partisan approach and the depth of our database makes HouseMark ideally equipped to support local authorities and ALMOs in discussions on the future of their arm’s length management arrangements. Accordingly, we have been engaged by a number of authorities and ALMOs to provide independent analysis to support decision making. Three recent assignments indicate the range of areas where we can be of support: Commission A was from an authority exploring options around the future of its multiple

ALMOs – in the context of the need for efficiency savings. The focus was on ‘back office’ costs and overheads. The authority is now considering retaining its ALMOs on the basis of a shared service model

Commission B was from an ALMO preparing the case for retention for its parent authority, which was considering bringing the service back in-house. The assignment focused particular on service delivery costs, covering all management and maintenance functions; a regional comparator group of similar-size ALMOs and LSVT associations was used

Commission C was from an ALMO considering stock transfer. It wanted to compare its existing costs and performance with a regional comparator group of LSVT associations, in order that its model business plan was based on the most cost-effective ways of providing services

If you would like to know more about our work in this area, please contact Samantha McGrady on 07961 204771 or Carole Halfacre on 07949 407848.


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Appendix 4: About DouglasWood DouglasWood is a housing, regeneration and development consultancy set up in April 2009 by Steve Douglas, the former chief executive of the Housing Corporation, and Chris Wood, the former chief executive of the London Borough of Newham. The consultancy consists of housing and regeneration sector experts with a wealth of experience of top-level management in the local government and public sectors. DouglasWood has worked extensively with the local authority and ALMO sector: providing interim chief executive and senior management support on asset management

delivery in a number of ALMOs providing parent local authority ALMO client management support to a number of local

authorities, including supporting the delivery of improvement plans to help achieve a two star accredited service in two ALMOs

providing senior management support on regeneration and development strategies; and housing management and tenancy services to a number of local authorities

advising the affordable housing sector on worklessness and housing strategies About the Authors Steve Douglas is a Director at DouglasWood. As former chief executive of the Housing Corporation, he was responsible for introducing public funding to support ALMOs new building and a housing management quality service accreditation scheme. He has written reports and papers for HouseMark and others on the role of local authorities and ALMOs and was a member of the Communities and Local Government and Local Government Association commission on local authority new building. Lanek Banga is a DouglasWood consultant. He is an experienced policy and performance manager with a background in strategy development. He has worked in local government on housing, homelessness and equality strategies. He has also worked for housing associations on development and regeneration initiatives. More recently he has been working as an ALMO client manager for an east London local authority and he is currently chair of the Greater London Authority Housing Equality Standing Group. If you would like to know more about our work, please contact Steve Douglas or Lanek Banga on 020 7729 0420 or visit the DouglasWood website: www.douglaswoodltd.com.

http://www.douglaswoodltd.com/

Further information For further information visit our website www.housemark.co.uk or call 024 7646 0500. HouseMark, 4 Riley Court, Millburn Hill Road, University of Warwick Science Park, Coventry CV4 7HP.

About HouseMark HouseMark is the leading provider of performance improvement and value for money solutions to the social housing sector and is jointly owned by the Chartered Institute of Housing and the National Housing Federation; two not-for-profit organisations which reinvest their surpluses in the social housing sector.

whose stock is it anyway? local authority perspectives on the future of almos

Documents

future of almos

vast majority of almos

almo formation

almo model

almo achievements

almo sector view

parent local authorities

parent local authority