Beyond Decent Homes - Communities and Local Government Committee Contents


Annex


Visit to Stockport 23 November 2009

Participants
Dr Phyllis Starkey MP John Cummings MP
Neil Turner MPAlison Seabeck MP

Programme

10.30 am  Introductory meeting with Stockport Homes and Stockport Council.

12 noon  Tour of social housing area and visit to homes

1.15 pm  Lunch with interlocutors: Stockport Homes; Stockport Council; Finley (Building Contractor); Johnnie Johnson Housing Association; GM Procure; tenants

2.30pm  Evidence Session (National Federation of ALMOs, East Durham Homes; Residential Landlords Association; Professor Tony Crook, Professor of Housing Studies)

Meeting notes

Stockport Homes

In 2005 the ALMO was established and the first funding came through that August. They received £20 million to spend in 6 months so had had to make detailed preparations before receiving the funding.

In 2003 housing in Stockport had been 54% non-decent. In 2006 Stockport Homes received its funding; at that point the stock was 37% non-decent. The level of non-decency had now fallen to 12% of stock. Stockport had needed £104 million to reach the decent homes target by July 2010. They had received accelerated funding of £2 million in 2007 and £5 million in 2009. In the previous ten years funding had not been available to do refurbishment and available money had been spent on the basics such as heating. Kitchens and bathrooms had only been done up when absolutely necessary and as a result some had been 40 or 50 years old before the decent homes programme.

Stockport Homes managed 11,500 housing units on three main estates. There were 22 high rise buildings, 150 medium rise and 500 low rise properties. The decent homes standard was based on a "normal" house and did not take into account the needs of communal areas around high rise buildings. There were 900 non-traditional properties spread out across the borough. These were hard to heat but discussions with tenants had revealed that people wanted external over-cladding rather than internal measures. This work had been started a few years ago and had reduced inhabitants' fuel bills.

The decent homes standard was a "fantastic government programme" and it would a great shame if the work was wasted because of a lack of funds after 2010. If the review of the HRA subsidy system was successful, the decent homes programme in Stockport would be able to grow and improve. If the only resources provided after 2010 were through the current HRA system, then there would not be sufficient funding to maintain the decent homes standard.

The decent homes standard itself was minimal and they and others had reached a "decent homes plus" standard, which led to higher tenant satisfaction.

The decent homes standard provided a core skeleton of necessary work. Kitchens and bathrooms had been improved on top of that. Every property received a "pre-entry survey" to determine all the improvements needed and the cost involved, to allow the decent homes work and any other necessary work to be done all at the same time. Each customer received a bespoke design for the work before it was carried out.

The work had been carried out across different geographical areas at the same time, rather than completing areas sequentially.

The funding received was spent on the kernel of decent homes work but on other works as well, and Major Repairs Allowance funding had been added in to the available money. A consortium, GM Procure, had been set up four years ago. This brought together 55 social landlords who had agreed common specifications for improvements to homes. The group had then split the supply chain into labour and materials. The consortium had been able to capture significant rebates paid to contractors for buying materials from suppliers in large volume. Stockport Homes had received £2.5 million in the last year in this way. The money was recycled back into the housing improvement programme, allowing them to put showers into properties even though these were not required by the decent homes standard. They had also built into the work programme home adaptations for the elderly and disabled, rather than returning at a later stage to do those works.

Before the decent homes work was carried out a building cost model (stock condition survey) was used to assess standards of the stock, the work needed and the cost of that work. This was a rigorous process. However, there were no checks or auditing carried out after the work had been done and prices could have changed since the original cost model was produced.

The Audit Commission required an independent stock survey to be carried out and Savills had conducted a survey of 10% of their stock in 2003, 2005 and 2009. Those in house surveyors conducting the internal stock condition surveys were trained by Savills and it was noted that there was a fairly uniform standard of expertise across the UK.

Stockport produced regular monthly updates on the works programme using an in-house database. Homes were re-surveyed after work had been carried out and that data entered into the database. The database allowed them to predict which properties were about to become non-decent. The information from the database was fed back to the Council and reported to the Government.

Savills had also audited the stock condition database to ensure that the system was robust.

GM Procure included local authorities, RSLs and ALMOs from across the North West, Cumbria and East Lancashire. The consortium had started in Manchester. Other regeneration consortia existed but none of the same volume; GM Procure was the largest in the country and had been designated a "trailblazer". Other areas wanted to join.

The consortium dealt with 40 contractors. They aimed to use small and medium-sized enterprises (SMEs) as large contractors had high overheads. Also SMEs could be influenced to a greater extent—the consortium specified, for example, that two trainees must be employed for every £1 million work provided. There were 27 trainees at work on the Stockport programme, 46% of whom were female or from black or minority-ethnic background. A range of community enterprises were supported through the programme involving the engagement of ex-offenders.

The consortium was used to supply all materials for both new building and home improvements. Using the same components for both meant that it would be easier to carry out refurbishments in the future. Stockport Homes was the first ALMO in the country to build new homes whilst receiving a grant from the Housing Corporation.

There was no legal relationship between the contractors and suppliers but all signed up to a procurement framework. Performance was excellent because GM Procure was one of the largest customers in the country. Over 90% of work was done on time without defects.

The incentive for the contractors, although they did not receive their rebate from suppliers under GM Procure, was a long term, sustainable programme of work. The programme was also a vehicle for NVQ level 2 training and trainees could work for different contractors in sequence under a "carousel" system. The programme was also training unemployed people to obtain driving licences in order to work, which was of long term benefit. GM Procure was also working with persistent ex-offenders from three prisons, with "really good" outcomes.

It was easier for landlords in other geographical areas to join an existing consortium than to set up their own. There had been many doubters when GM Procure was set up but success had brought many more organisations into the network.

Individual officers had driven GM Procure forward through sheer energy and strength of personality. Stockport had taken a risk in jointly setting up GM Procure, which then had to be made to work. The other side of taking the risk was that the founder members of the consortium were now enjoying the best returns as they had preferential rights.

The ALMO community was good at sharing best practice and housing associations had also been brought into the network. There was further to go and a new work stream had been brought in to cover responsive repairs. They had just let a tender for 3,000 vehicles in the largest such contract in the country and had secured a discount of over 30% which would be recycled back into the programme.

All the windows used in the works programme were the same system although different styles. They were "secured by design" (a security standard endorsed by the Police) and PAS 23 or 24 (a security and performance standard for doors). The glass used reduced the release of heat by a property and the PVCu in the frames was recycled. It had taken 7 years to replace all the windows in the stock.

The advantage of the procurement framework used by the consortium was that the performance management could also be leaner: fewer staff were needed in Stockport Homes to manage the relationships with suppliers and contractors.

When the decent homes programme was established, councils had to choose out of several options for the management of their stock. Stockport had tried to arrange a large scale voluntary transfer (LSVT) to a housing association but the tenants federation had campaigned against it. Setting up an ALMO was the only remaining option, and Stockport had bid successfully for funds in Round 5.

Following the campaign against the proposed LSVT, and in order to persuade tenants to agree to the transfer of management to an ALMO, Stockport Council had worked hard to regain the trust of tenants. This had been a long process involving the production of an updated, more detailed stock appraisal. Tenants placed great value on the fact that under an ALMO they would still be council tenants.

The 5% of decent homes funding which could be spent on sustainability measures had been used for community work. The decent homes standard was a major success and it had raised tenant expectations as there had been no spending on improvements before then. It would be a terrible shame if the achievements of the programme were lost through funding being cut or clawed back. Decent homes money should not be redirected to new build. The decent homes programme created jobs and had a beneficial effect on a greater number of people. Very vulnerable people would not receive the improvements they had been promised if funding was re-programmed.

In Stockport the waiting list for council homes was 9,000. Demand was very high and there were high levels of owner-occupation. The Government had prioritised house-building in 2007. Land was not available for new build in Stockport.

The proposed HRA reform could allow Stockport to sustain and expand the work already carried out. New building in Stockport was resourced through grant funding and prudential borrowing. Stockport was driven by achieving value for money.

Stockport was working with the HCA to bring together social landlords to look at sustainable products for retrofit and new build. There were strict codes for standards of new building. There was scope for a huge amount of work retrofitting renewable technologies to existing stock.

The SAP rating which could be reached with older stock was limited by the design of the housing. SAP ratings were brought into new build properties. Over-cladding of older properties saved the residents around £200 a year in fuel bills. Rents had not increased.

Stockport had the lowest rents in the North of England and was at the lower end of the scale nationally. Rents were now increasing in line with government policy on rent restructuring.

Standards in the private rented sector were low. There were few resources for improvements in the private sector. Some homeless people were housed in the private rented sector.

Stockport Council

It was essential to take a long term view of the stock condition in order to foresee and prevent homes falling below decency standards.

There were tensions around building on green field land. In Stockport there were lots of "bitty" brown field sites scattered around, which made it more expensive to build. They were trying to maximise the available land for new building but if home improvements did not continue, the work carried out so far would have been wasted.

Insulation work reduced excess winter deaths and mould growth in properties, and helped to contribute to carbon reduction targets. Frontline workers in fuel poverty or living in cold homes in the private sector were offered training and directed by the Council towards available services such as the Warm Front programme. Stockport's housing had high levels of insulation compared to housing in other regions.

The Council worked with private landlords through a forum. The private rented sector represented only 7% of stock. Most landlords in Stockport were non-professional. The forum ran meetings to which 30 or 40 people turned up each time, produced newsletters, provided training and hosted a virtual forum. The Council served few notices and preferred to work with landlords to secure improvements to stock. The Housing Act 2004 had provided much greater scope for enforcement action and the HHSRS was a much higher standard than the "fitness" standard it had replaced. The Council did not just look at Category 1 hazards when assessing private sector homes. The number of Council interventions with landlords had increased although numbers of notices served remained low. Rather than re-housing those living in inadequate housing, the Council would work with the landlord to improve the housing.
Year  
Private rented sector interventions
Numbers of notices
2005/6414 38
2006/7450 20
2007/8459 5
2008/9527 16
2009/10 to October 332 

The HHSRS was a rather low standard, as was the decent homes standard. The Council did a lot of work to persuade landlords to raise standards and had provided grants for such work for many years. The approach was to encourage landlords to improve the marketability of their stock, which worked well. The housing market in Stockport allowed people to pick and choose between properties so the incentive existed for improvements to be made.

GM Procure

Procurement consortia in London included LAPN (London Area Procurement Network) based in Kensington and Chelsea and Buy4London, based in East Thames. Some procurement consortia had not had the success of GM Procure because no-one had taken the lead. Those organisations had focussed instead on benchmarking products.

GM Procure was driven forward by the programme of works social landlords were engaged in. They had been able to impose standards on contractors and suppliers because of the large volume of work.

GM Procure had a constitution to which members had to commit. 1% of the value of the works programme was spent on work that benefited the community, such as training, community enterprises, house clearances and work with the unemployed.

There was £120 million of work on the order book for the year and £190,000 was being spent on community work in Stockport Homes alone. For example, unemployed people were improving parts of estates. GM Procure had focussed on decent homes work but was now able to influence other markets. They were moving to a materials framework rather than leaving contractors to buy the materials themselves.

GMP was a company limited by guarantee, not-for-profit and owned by its members. Private landlords could not join the consortium under its current rules.

All contractors were subject to financial checks as part of the framework agreement and GMP was able to receive information on their financial viability direct from their banks. They employed a traffic light system to monitor which businesses were in trouble. GMP had assisted a company which went bankrupt to be purchased by another member company of GMP.



 
previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2010
Prepared 23 March 2010