HCA reveals new regulatory framework
The Homes and Communities (HCA) yesterday (May 27th) published its revised regulatory framework setting out plans to protect social housing assets.A 12-week consultation has been launched on plans to protect social homes and the public value attached to the assets.The release of the consultation report follows a discussion document which was published in April 2013 and has been developed in light of the feedback the HCA received.Changes will include the requirement that landlords "stress test" their businesses against potential risks, while they will also need to have a comprehensive register of their assets and liabilities.A new code of practice is also set to be introduced in order to ensure providers have a greater understanding of what is required by the revised governance and viability standard.Changes are also set to be made to the HCA's disposals regime to ensure profit-making registered providers have the confidence to develop business plans and approaches to working in the social housing sector.An expansion to the disposals proceeds fund will require all such providers' sale proceeds that are derived from existing stock in the non-profit sector to be used to build replacement units. Julian Ashby, chair of the HCA, said the sector previously relied on substantial levels of government grants, banks providing long-term debt on low margins and housing benefit underwriting rental income in full. He said the fact that these considerations no longer apply has profound consequences for providers and the regulator."Our job is to protect social housing assets and their public value. This is for the benefit of tenants, taxpayers and lenders," he added."It also provides the preconditions for further investment and asset growth. We consider that changes will be needed to keep the regulatory framework 'fit for purpose'."Full details of the proposed changes to the HCA's procedures are contained within the statutory consultation document, which is available to download from the organisation's website. The consultation period is set to close on Tuesday August 19th.
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