Conclusions and recommendations
1. There has been substantial progress towards
the objective that all social housing should be of a decent standard
by December 2010. Over
a million homes have been improved since 2001 and there have been
wider benefits such as more tenant involvement in housing decisions
and jobs created in deprived areas. However, some elements of
the Department's financial control were weak and the Department
did not exercise sufficient oversight of the Decent Homes Programme's
devolved delivery. Our recommendations reflect the need for the
Department to get a stronger grip of these issues in future.
2. An estimated 305,000 social sector homes
will still be non-decent at December 2010, and work on these will
not be completed until 2018-19. Although
the Department has stated its commitment to fund the remainder
of the Programme, there is a risk that such funding will not be
forthcoming, given likely pressures on future public spending.
The Department should prepare a contingency plan for the Programme's
completion, with options and priorities clearly identified should
funding not be available.
3. If the Decent Homes Programme is to achieve
value for money in the long term, local authorities need clear
plans in place to prevent the build up of another maintenance
backlog. The Department intends that each
local authority will fund maintenance themselves in future. The
Department will be announcing details of its proposals imminently,
and it is vital that it then acts quickly to finalise the new
funding arrangements with individual local authorities, based
on reliable assessments of likely costs and revenues.
4. It is unsatisfactory that the Department
did not identify the likely cost of the Decent Homes Programme
to the social housing sector at its start.
The £19 billion estimate it did prepare was not 'fit for
purpose' as it omitted the cost of improving housing that would
fall below standard as the Programme progressed, the cost of inflation
and the costs to Registered Social Landlords. The Department should,
for future programmes, provide more robust estimates of the likely
costs before starting.
5. It is not clear how much the Department
has given to the social housing sector to fund the Programme.
Decent Homes funding streams and costs are not separately identified
from other money spent on housing and the Department can only
estimate how much has been used on Decent Homes. In future, when
setting up major programmes, the Department should first be clear
on what costs it is letting itself in for, and then put in place
arrangements that enable the costs it then incurs to be accurately
identified.
6. Arms Length Management Organisations (ALMOs)
have spent more on improvements per property than local authorities
that retained their stock. The Department
has not gone back to examine whether ALMOs were provided with
more funding than was necessary. The Department and the Homes
and Communities Agency should go back to those ALMOs that have
completed their work to identify why they spent more per property
and assess whether any future funding needs to be reduced.
7. The Department has done little to compare
unit costs of different approaches to carrying out work to improve
the standard of homes or to share this information with landlords.
The Department should, as part of its current evaluation of the
Decent Homes programme, identify the most cost effective approaches
and then disseminate good practice.
8. It is unacceptable that the Department
lacks basic information, such as the total number of homes made
decent. The Department should, in the
first instance, make sure that information on monitoring returns
is accurate, and that the numbers of homes made decent can be
separately identified from those where tenants refuse work or
where homes are scheduled for demolition. For future programmes,
it should ensure that it builds in adequate arrangements for the
collection of robust monitoring data from the very start.
9. The Department has only provided extra
funding for Decent Homes to those local authorities which have
set up ALMOs, used the Private Finance Initiative or transferred
their housing stock. Local authorities
that wished to retain day-to-day management of the housing stock
had to fund improvements from their own resources. As part of
its current evaluation of the Decent Homes programme, the Department
should examine whether the policy decision not to provide additional
funding to some local authorities has had a negative impact on
value for money, for example, if lack of funding led to cheap
materials being used that consequently needed to be replaced earlier.
10. The Department has very little information
on whether the funds provided for improving private sector homes
have been spent well. It does not separately
track this spending and has done little to monitor individual
local authority performance. The Department should assess the
impact of the funding it provides through local authorities, in
order to identify and disseminate good practice.
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