Agenda item

(i)              Report of the Assistant Chief Executive.

(ii)             Presentation by Bill Fullen, Group Chief Executive, County Durham Housing Group.

The Chairman introduced the Chief Executive of the County Durham Housing Group (CDHG), Bill Fullen who was in attendance to give an update presentation as regards the CDHG (for copy see file of minutes).

The Chief Executive, CDHG reminded Members of the background to the CDHG, with transfer of around 18,500 properties to the CDHG from the Council on 13 April 2015.  It was added that £150 million of finance had been secured from Barclays Bank and M&G Investments with good long-term fixed interest rates, giving a stable financial position.  It was explained that the homes transferred were already at a standard higher than the national Decent Homes Standard (DHS), and the CDHG transfer was the first post-DHS transfer.

The Chief Executive, CDHG explained that subsequent to the General Election, the new Government imposed a 1% rent cut for four years and this had an impact of a £21 million loss in terms of cash over those four years, impacting upon the non-allocated resource of £70 million.  It was added that other issues that impacted upon the CDHG included voluntary Right to Buy (VRTB), which CDHG had signed up to, and issues in terms of regulation.

It was noted these included an in-depth assessment by the Homes and Communities Agency (HCA), with ratings of G2 for governance and V2 for viability, though noting comments in terms of the complexity of the group with a need to simplify.  The Chief Executive, CDHG added that another issue was that an Office for National Statistics (ONS) reclassification had meant that housing associations that had public stock transferred to them were within the public sector, however, it had been clarified that new planning legislation would in turn declassify those housing associations, moving them back out of the public sector.  Councillors noted that further Welfare Reforms including Local Housing Allowance, and the roll out of Universal Credit reducing the housing allowance available could cause tenants to look to the private sector for cheaper accommodation and would therefore impact and inform future service delivery.

The Committee were reminded of the transfer Offer Document that had been developed in consultation with key stakeholders and set out the promises to tenants in relation to: extra investment in existing homes; better quality neighbourhoods; new jobs and apprenticeship; more varied services; and new homes.  It was noted that there were quarterly meetings with the Council’s Head of Economic Development and Housing, Sarah Robson to monitor progress in this regard and that of the 80 promises set out in the Offer Document, currently 68% were being provided in full, 27% were partially provided or in progress, with 5% yet to commence.

The Chief Executive, CDHG added that in terms of investment in the stock, this had been made upon the basis of the Stock Condition Survey that had been undertaken, and the investment was carried out in order to maintain progress with the “Durham Homes Standard”, a standard beyond the Government’s DHS, and to make improvements in areas such as bathrooms and kitchens.  Members noted £20 million of investment in 2015/16 with over: 750 kitchens; 720 bathrooms; 650 rewires; 700 new boilers; 700 new roofs; over £1.5 million on disabled adaptations.  It was added that this level of investment would be continued to ensure the standard of the stock was maintained.

Councillors noted that in connection with repairs and maintenance, late evening and weekend appointments were currently provided by East Durham Homes (EDH) and Durham City Homes (DCH) and that during 2015/16: 99.9% of emergency repairs were completed within 24 hours and 99.8% of responsive repairs appointments were made and kept. 

It was explained that the Handyperson service was now available across all three landlords and Dale and Valley Homes (DVH) and DCH had reduced their external painting programme from a 7 year cycle to a 5 year cycle, with EDH terms to be looked at when the service goes back out to tender in 2019.

Members noted that in terms of better quality neighbourhoods, a Neighbourhood Quality Standard (NQS) had been approved in March 2016, and set out what tenants could expect, and also what was expected from tenants.  It was noted there was a Service Level Agreement (SLA) in place with the Council’s Grounds Maintenance Service and the level of service had been very good.  Councillors noted the community investment schemes in place across all three providers, with the DCH “Grab a Grant” scheme launched in October 2015 having supported over 41 initiatives and invested over £16,000 over 2015/16.  It was added that the impact of these funds had been far greater than the cost providing training for volunteers to help give each community what it needs.  Members noted the DCH Neighbourhood Pride Initiative, which included the planting of trees, flowers and the installation of heritage interpretation boards across 14 sites and during 2014/15 there had been an investment of £9.8 million through the neighbourhood investment programme.

The Chief Executive, CDHG noted that in terms of new jobs and apprenticeships, there had been: 33 tenants helped into employment; 6 into apprenticeships; 1 into self-employment; with 63 tenants attending employability workshops.  Members noted that the CDHG had also created 27 new jobs, 13 apprenticeships and 11 work placements.  It was added that additional support for tenants included Welfare Benefits Officers and Energy Advisors which had estimated to have secured £2 million of payments for tenants this last year. 

Members noted that it was an aspiration for the CDHG to build 700 homes, and the CDHG Board had approved the development of 32 new homes via Section 106 requirements, sites including Bracks Farm, Bishop Auckland, 7 properties and Ushaw Moor, 25 properties.  It was noted there was some headroom in terms of purchasing further Section 106 properties and funding approval was pending for a further 150 new homes.  The Chief Executive, CDHG added that while progress was slow, the important message to the public was that CDHG was looking at new homes.  It was explained that other services being looked at by the CDHG included: Digital Inclusion, helping tenants become ready for issues such as Universal Credit which would be accessed online as the default channel; working together within the group to share ideas; and the hosting of a range of training courses, at the DVH Mickle Grove facility, that had been accessed by 170 tenants.

The Chief Executive, CDHG explained that in terms of the future for CDHG, there would be changes once all repairs services were retendered after current contracts end, with emergency repairs for severe problems such as total loss of power, heating or a water leak to be attended within 2 hours and made safe within 12 hours, and for urgent repairs to be within 3 days.  Members noted that in terms of better quality neighbourhoods, £410,000 had been allocated for 2016/17 to prioritise community investment, with the development of a resource centre for customer involvement for DCH, in line with DVH and EDH. 

It was noted that the support and services required for older people would be assessed; looking at what specifically was needed.  In terms of new jobs and apprenticeships, it was added that there would be a targeted work placement programme with estate management and extension of the Junior Wardens scheme. 

The Chief Executive, CDHG added that there would be provision of more varied services, with: accredited money and debt advice service; mediation service; improvements in dealing with anti-social behaviour; and a group-wide Occupational Health service.  Members noted that in respect of new homes, there was a HCA funding application for up to 200 new homes for the period 2017-2021.

The Chief Executive, CDHG concluded by noting that one year in, the CDHG had made a good start, was ahead in terms of new build, and despite the 1% rent cut was still delivering the offer, noting it was a 7 year promise.

The Chairman thanked the Chief Executive, CDHG and asked Members for their questions on the update report and presentation.

Councillor E Adam noted the many positives as set out in the presentation, including those in terms of investing in kitchens and bathrooms, however, asked whether there was also investment in terms of helping tenants with their energy costs, looking at physical solutions such as solar panels and providing support such as debt advice.  The Chief Executive, CDHG noted that there were 6 Energy Advisors at the CDHG, and they could provide information to tenants on the issues stated.  It was added that as part of the offer a “reasonable degree of insulation” was set out and the Standard Assessment Procedure (SAP) energy efficiency rating of a property would be looked at and properties to be improved would be identified.  The Chief Executive, CDHG explained that a small number of the Group’s properties did have solar panels, however changes by Government in terms of the feed-in tariff meant that it was no longer a good deal for installation companies, however other energy efficiency solutions would be looked at, such as condensing boilers and insulation.

Councillor D Hall noted that there may be EU Funding available, albeit perhaps for a limited time, in terms of other energy efficiency measures, such as energy storage in conjunction with solar panels, and other renewable sources of energy.  Councillor D Hall asked as regards VTRB and whether this would mean there could be a rental income decrease and were other models being looked at, such as leasehold sale.  Councillor D Hall also asked as regards community led development.  The Chief Executive, CDHG noted he was not aware on any funds in terms of community led development and that there were Government schemes in terms of helping people to buy.  It was explained that there were models such as the rent-to-buy, looking at 2-5 years renting, with then the option to purchase after that and that generally the models would be looking at people in work and targeted towards the non-Durham Key Options (DKO) properties.  The Chief Executive, CDHG noted that Government rules meant that there needed to be a mix of tenure and not all properties would be social housing and it was added that a number of the products available would not be appropriate for the North East of England.    

Resolved:       

(i)              That the Economy and Enterprise Overview and Scrutiny Committee note the progress of the County Durham Housing Group since transfer.

(ii)             That the Economy and Enterprise Overview and Scrutiny Committee schedule into the Committee’s future Work Programme consideration of the County Durham Housing Group’s annual report together with an update on performance in October every year.