Examination of Witnesses (Questions 267
- 279)
TUESDAY 18 JANUARY 2005
MR VIC
SMITH, MS
HELEN MARSON,
MS CAROLYN
PALMER-FAGAN
AND MS
REVINDER JOHAL
Q267 Chairman: We have had some informal
sessions this morning, looking at a school in the city and the
primary care trust in south Birmingham, and we are very delighted
to be in Birmingham looking at public services as part of our
inquiry into what we call "Choice and Voice". We are
grateful to the City for its hospitality. If we can move into
our afternoon session, we would like to take more formal evidence
on aspects of city council services. We are going to start with
the housing service in Birmingham. We wanted to explore some of
the issues with you. We have had some background papers, so we
know something about what has been going on, but would you like
to kick off by giving us a bit of scene-setting?
Ms Marson: Birmingham City Council
is landlord to council housing stock of currently around 72,500
properties, so we have a considerable tenant population that obviously
receives the council housing service. We have an investment gap
of around £165 million to achieve the Government's decent
home standard, which is a target set by the Government that we
should improve all our housing stock to the decent home standard
by 2010. We are saying that on the resources available to the
City Council we are about £165 million short of achieving
that. You may be aware that the Government has required local
authorities in the Communities Plan 2003 to carry out an option
appraisal, to explore how, through other routes the Council could
achieve the decent home standard by that target date. Essentially,
that involves an exploration of three options: arm's length management
organisations, private finance initiatives, or transfer of stock
to a new or existing RSL. The background papers you have are about
the approach that Birmingham is proposing to take to completing
the option appraisal process. We have developed an over-arching
strategy, which we are discussing with the government office for
West Midlands and the Office of the Deputy Prime Minister to finalise,
and we propose to complete five of our appraisals by July 2005,
and the remaining six by July 2006. The reason for that number,
11, is that we are doing them on the basis of the 11 constituencies
of Birmingham. They are the geographical boundaries we are working
to.
Q268 Chairman: Thank you for that.
The Committee has had evidence in the past from people involved
in housing who have talked to us about choice-based letting systems,
and we have had discussions about the notion of choice around
stock transfers, and I suspect these are the kinds of issues we
would want to explore with you. Can I start by getting to the
heart of this stock transfer issue. We are not going to explore
the substance of these issues, but want to test the arguments
about giving people a say in what happens to them. We had some
evidence from the Director of Housing in Newham, who said to us
that he thought it was a mistake to try to do balloting on this
issue; that if the Government wanted to finance social housing
in a different way, as it clearly does want to do, it should do
it as a public policy measure. These are not his words, but the
argument is that there is something bogus about this notion of
choice. Has the balloting business in Birmingham caused all kinds
of difficulties, and now you have to go off in different directions
to find a different route around it? Would it have been simpler
to have forgotten about choice in all this and say, "if there
is a public policy position that we move housing in a different
direction, we should simply do it"?
Ms Marson: I would be expressing
a personal opinion rather than one of the City Council, but I
do not think that we should take choice out of it as a consideration
personally. I think we do have to have regard to tenants' views.
There are two separate issues for me then: what is the policy
on choice, and to what extent should tenants have a say in the
outcome of the service provider and the landlord? If there is
a pre-determined decision to change financing of local authority
housing, and what we keep doing is forcing authorities to go through
processes until we get the right outcome, then that could cost
quite a lot of money, and properly the decision should just be
made at the outset, and we should say "regardless of choice
this is the way we want to do things". It is about clarity.
Why are we doing it, and does choice take precedence over some
other pre-determined outcome that is being sought?
Q269 Chairman: Do you feel in Birmingham
that you have found your way through this, doing it through this
neighbourhood solution?
Ms Marson: The approach that we
are taking is that this is not a ballot, it is an expression of
interest, an expression of preference from tenants. At the point
at which we will have completed option appraisal, tenants in each
of our 11 districts will have expressed a preference. If the preference
in some of the districts is for partial transfer to an RSL, then
there will be a legal requirement for us to carry out a ballot.
There is always a risk that the expression of preference gave
us an indication that there was tenant support for transfer, and
that subsequently, as we develop an offer document setting out
the detail of what will happen, when it gets to ballot tenants
vote against it. That will remain a risk. If that is what happens,
the tab for that will be picked up by the City Council; there
is no funding available to us for that process. On some of the
other options, which are about arm's length management organisations
and private finance, because they do not involve a change of ownership
of stock, they only involve a change of service provider, then
there is no legal requirement for a ballot. The City Council could
take a policy decision that it would like to conduct a ballot,
but it would not be that it was a legal requirement to do so.
We anticipate that the outcome of this exercise will be that in
the 11 districts we will get a mixture of solutions. That might
be that at a whole district level—so we might get a district
deciding wholly on partial transfer or private finance, or within
each district they might identify a number of preferences, because
the districts are of considerable geographical size and vary in
property numbers from 2,000 to over 15,000, so within that there
is the potential for them to identify a number of solutions for
that area.
Q270 Chairman: How do you seek to
involve your tenants more generally in the housing service? Maybe
Vic would like to have a word about this. How does the Council
seek to involve its tenants and give them more of a say in the
housing service? Traditionally we think, rightly or wrongly, about
housing services being top-down—the old stuff about not
choosing the colour of your door. How much progress have we made,
leaving aside the stock transfer issue for the moment, in involving
tenants far more in housing service issues?
Mr Smith: If you start from where
the stock transfer was, we have been involved more since stock
transfer than we ever were before. I am going back 10 years. We
are involved now more with housing than we have ever been involved.
The tenants have the chance to come and say what they want. That
is the only thing you can say. You have the City HLB, area HLBs,
CBHO steering group and all sorts of centres where the tenants
can come and have their say and tell us what they want from their
housing service. We are involved in everything, for example contracts.
There is that much it is hard to pick out a few.
Q271 Chairman: Let me pick up what
you have said and put it back to the housing managers. That is
quite an interesting statement, that it was the prospect of exit,
that is the stock moving, that has had the effect of involving
tenants far more than was the case before. Someone might ask why
it took that to produce what we have now.
Ms Palmer-Fagan: I know why Vic
says he is going back 10 years because that is when I came into
the organisation, to work specifically on engaging tenants in
our service provision. As the years have gathered momentum, as
Vic quite rightly said, tenants sit down in this room once a month
with senior people of the department and politicians to make decisions
on how the housing service is delivered. There are local consultation
fora. Vic is quite right that they are involved in selecting contracts,
big and significant contracts for the City and housing service,
like cleaning contracts. They are involved in recruiting senior
staff, the director, and senior managers. They are involved in
that process. They have picked up that experience along the road.
What happened in 2000 was that they had more informed choice about
the service and knew what they wanted and did not want; hence
we had the result we did in 2000-01. Now, and since then, we are
more able to build upon consultation fora around stock options
appraisals, and now because tenants have more choice and are well
informed we embrace their involvement. As a district housing manager,
I would not like to make any decisions in my district about changing
that service without engaging and involving the people who I provide
those services for. Quite rightly over the years, we have been
building up and training them, and supporting them, genuinely
involving the tenants in those processes, which has enabled them
to make more choice. We have not had an easy road with it, because
when you give people choice and transparency it is not about your
job being made easier; it is about meeting those challenges—and
challenges, quite rightly, have come to our front door for us
to resolve.
Ms Marson: The whole stock transfer
issue told us that it was not, in Birmingham anyway, going to
be the case that we would get one solution for the housing service.
Since then we have put a lot more effort into developing local
structures so that there are fora locally to determine the outcome
of the future of the housing service and the option appraisal
for their area, because we would not want to assume that something
that had been done centrally and producing one solution for the
whole city would work.
Q272 Chairman: There was something
about the stock transfer process that produced such a level of
engagement and involvement that, presumably, you could not go
back to running the service in a different way, having got tenants
so actively involved in thinking about their service.
Ms Marson: We set out, after the
ballot results, to develop what we call community-based housing
organisations, which is a generic term and could be anything from
a resident forum for consultation purposes through to tenants
taking management responsibility for the housing stock through
developing a tenant management organisation. We proactively engaged
in a process establishing these community-based housing organisations,
and we did that in two pathfinders initially, one of which is
Hodge Hill, which is where Vic and the other managers are from.
Q273 Mr Hopkins: Given that the tenants
voted, by a very substantial majority, against these options and
to stay with the Council, why has the issue been re-opened even
on a partial basis? Has that initiative come from the tenants
or has it come from the Council, driven by Government?
Ms Marson: It has come from the
Government. It is a legal requirement that we complete an option
appraisal by July 2005.
Q274 Mr Hopkins: So the Government
is breathing down your neck to get this position changed and to
try to get the tenants in line.
Ms Marson: The Government requirement
is that each authority identifies how it can achieve the Government's
decent home standard, and because we are saying that Birmingham
City Council cannot achieve that standard with its own resources,
it is a requirement that we explore the other options that are
available.
Q275 Mr Hopkins: There has been a
lot of debate at our own party conference about the fourth option,
which is giving the money to local authorities to do the repairs
and whatever is needed to bring the housing standards up. The
Government presumably has not given the extra money you require
to do that, despite the massive vote by the tenants to stay with
the Council.
Ms Marson: No. The resources that
are available to the Council—the £165 million gap that
I referred to—are based on current housing finance policy,
and there is no indication of any proposals to change that.
Q276 Mr Hopkins: Given the strong
involvement of tenants in governing the whole of the council housing
in Birmingham now, and given you have democratic control of council
housing and democratic accountability—and I would think
a good record of housing management; if you had the money, that
would solve all the problems, and indeed it might be cheaper in
the long run. Is that not the case?
Ms Marson: I do not think we would
have a situation where that would mean we have to consult with
tenants about the future of the service because there is still
work to do on the way that the service is provided and local preferences.
But in terms of investment requirements, obviously different financial
arrangements might mean—tenants would be deciding, through
our option appraisal process on different options in the full
knowledge that the Council cannot deliver the improvements that
they want. That would be different if, obviously, the Council
were—
Q277 Mr Hopkins: The Government will
give the money to the other providers, but not to you.
Ms Marson: Yes. The additional
funding is available through the other three options but not through
this retention of housing stock.
Q278 Mr Hopkins: You have obviously
got to consult with the tenants about the future and it is absolutely
right that they have involvement and express preferences; but
their one strong preference was that they want to stay with the
local authority and not be transferred to any other organisation.
Ms Marson: Yes, they balloted
against transfer to an RSL in 2002.
Q279 Mr Hopkins: Do you think it
makes a nonsense of choice in democracy if, once a decision has
been made in such an overwhelming fashion, the whole question
is re-opened, and you say "go back and do it again",
even if it is done by degrees and on a partial basis?
Ms Marson: To be fair and balanced
on that, I would have to say that the only thing that the tenants
voted against last time was the proposal that was specifically
put to them, and that was for a total transfer of the housing
stock to one new organisation. What the options are that tenants
are exploring with us this time is a partial transfer to either
an existing RSL or a newly-formed one, and there are other options
as well—arm's length management, private finance, or retention
of the Council. In principle, stock transfer will have been rejected
by the majority of tenants, but what we do not know and need to
look at in this process is whether, on a neighbourhood basis,
there may be strong support for that in some communities as a
solution for their area only. It would not necessarily be something
we suggested happened to the whole stock.
|
