Appendix: memorandum supplied the Department
for Communities and Local Government
Non-Executive
Vacancy
Regulatory Chair,
HCA
| Time Commitment: up to 2.5 days per week
Duration: 3 year tenure (with possibility of renewal)
Location: London ( a small number of meetings may be held outside London)
Remuneration: £50,000 - 70,000 per annum
Closing date: Friday 5th August 2011
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THE REGULATION OF SOCIAL HOUSING
Regulation of Social Housing
The regulated social housing sector accounts for approximately
a fifth of the homes provided in England. Regulated providers
include private landlords (mostly non profit distributing housing
associations) and public landlords (local authorities).
Their social housing activities are currently regulated
by the Tenant Services Authority (TSA) which registers and sets
standards for the provision of social housing services to tenants
- consumer regulation. Private landlords (but not public landlords)
are also subject to standards relating to their governance and
financial viability - economic regulation.
The TSA has a range of intervention powers that it
can exercise where standards are not met.
The Localism Bill will transfer these regulatory
powers and functions to a Regulation Committee in the Homes and
Communities Agency (HCA). The regulatory framework of powers and
standards which will transfer to the Regulation Committee will
remain substantially the same, and it will have functional independence
within the HCA in the exercise of powers which are directly delegated
to the Committee.
Why regulate social housing?
The rationale for state intervention (through regulation)
in the provision of social housing is based on the:
- Lack of competitive pressures
towards good, efficient service provision; and
- The presence of substantial public subsidy in
social housing provided both by local authorities and private
non-profit organisations.
There is also a specific factor that provides an
additional reason for regulation: more than £40bn of private
sector lending to housing associations has been advanced
by private sector lenders and investors (in addition to approximately
the same sum of public sector capital subsidy). The creditworthiness
of this part of the social housing sector is underpinned by a
number of factors, of which the effectiveness of the regulatory
environment is a significant element in maintaining lender and
investor confidence.
Together these factors provide a clear public interest
in some level of regulation of social housing provision.
What outcomes is Government seeking to achieve?
In terms of economic outcomes:
- Taxpayers are protected - landlords
operate efficiently, value for money is obtained from public investment
in social housing, public investment is safeguarded and not misused
and unreasonable burdens are not imposed on public funds; and
- Social housing supply - private sector investment
in social housing is retained and expanded and housing associations
remain financially viable and properly managed (consistent with
their independent status).
In terms of consumer protection:
- Social housing is well managed
and of appropriate quality; and
- Social housing tenants have an appropriate degree
of choice and protection and have the opportunity to be involved
in the management of their homes and to hold landlords to account.
The need for change
Last October, the Government published a Review
of Social Housing Regulation. Key recommendations from the
review (set out in an excerpt from the review at Annex B) were
accepted by the Minister and are now being implemented.
While announcing the abolition of the Tenant Services
Authority (TSA) the Minister guaranteed to preserve its vital
independent economic regulation functions, whilst scrapping unnecessary
bureaucracy, such as excessive top down data gathering and inspections.
The Localism Bill sets out the basis on which these
recommendations will be taken forward. It also sets out wider
reforms to the provision of social housing including changes to
the basis on which landlords provide services to tenants through
more flexible tenancy arrangements.
Government has also changed the basis on which it
provides funding for new supply of social housing. During the
current spending review period, the HCA is funding a programme
of Affordable Rent properties, principally through private non-profit
providers.
The Regulation Committee will be responsible for
establishing and operating a regulatory framework which ensures
that the social housing sector continues to maintain confidence
of Government and the private lending sector of its financial
viability, sustainability and capacity to manage its current social
housing and continue to expand the supply of social housing in
future.
Through transferring the regulation function and
establishing a separate Regulation Committee within the Homes
and Communities Agency (HCA) under the provisions of the Localism
Bill, regulation will continue to be exercised independently from
Ministers and other functions. At the same time opportunities
for achieving synergies and driving further value for money from
the co-location of social housing regulation and investment can
and should be captured.
THE ROLE OF THE HCA REGULATION COMMITTEE
CHAIR
The Chair of the new regulation committee will be
an important public appointment requiring an outstanding individual
with the ability to develop a very strong relationship with the
social housing provider, lender and government sectors.
The Chair will be responsible for:
- Leading the Committee and establishing
its overall strategic direction in line with its statutory objectives
and functions;
- Ensuring that the strategic direction and operation
of the Regulation Committee secures and maintains wide confidence
in the viability and stability of the social housing sector both
within Government, and with the sector's funders;
- Representing the Regulation Committee at the
highest levels with key stakeholders in Government, and with bodies
representing funder, provider and consumer interests and to the
general public
- Ensuring that the Committee operates and exercises
its functions in accordance with the highest standards of conduct
and probity, and established good practice in decision making
and that this is appropriately and effectively reviewed in consultation
with the HCA Board
- Maintaining a highly effective working relationship
with the HCA's Chair, Board, CEO and executive team in respect
of ensuring the proper resourcing of regulation activities, and
support to the Board and Chief Executive in ensuring the effectiveness
of the HCA's activities;
- Promoting the most effective and efficient use
of resources, including through overseeing the formulation of
the Regulation Committee's contribution to the HCA Corporate and
Business Plan, for agreement with the HCA CEO and Board;
- Ensuring that Committee members play
a full and active role, including that they are appropriately
briefed on their terms of appointment, their duties and their
rights and responsibilities, undertaking appraisals of members
and making recommendations to Ministers or DCLG for reappointments.
Creating the Regulation Committee
In order to achieve its objectives, the Committee
will require an equally strong cadre of non-executives. It will
comprise between five and seven non-executive members, supported
by a Director of Regulation. All committee members, including
the Chair, will be appointed by the Secretary of State, to whom
the Committee will be able to offer independent advice as necessary.
The timetable for appointing the Chair will allow
involvement in the recruitment of those members. It will also
allow time for an effective handover from the TSA Board, to establish
an effective working relationship with the Chair of the HCA Board,
to which Robert Napier has recently been reappointed, and its
Chief Executive and to establish a shadow board ready for the
transfer of function in April 2012.
In order to ensure functional independence, no more
than two of the Committee members will also be members of the
HCA Board. This includes the Committee's Chair, who will be an
ex officio member of the Board to ensure that the Regulator has
a strong voice within the corporate governance of the HCA.
The work and objectives of the Regulation Committee
The Committee will be tasked with ensuring continued,
independent and transparent regulatory decision-making while also
exploiting the synergies with the investment function, particularly
around the economics of social housing supply.
All Regulation Committee members will operate in
a non-executive capacity. The executive functions, including the
operational issues, will fall to a director of regulation who
will be part of HCA's wider management team. However, the Committee
will oversee decisions on:
- Regulation standards;
- Registration / deregistration of social landlords;
- Enforcement and intervention;
- Regulation policy;
- Financial benchmarking;
- Fees policy; and
- Delegation of regulatory functions.
Where the decisions require ministerial approval,
the Committee will be empowered to act in an independent advisory
capacity to Ministers. The Committee will also be required to
take direction from Ministers from time to time.
Where appropriate, the Committee will be empowered
to offer advice and guidance to the HCA's Board on the operation
of HCA's other functions where they affect regulatory objectives.
To ensure full transparency, the HCA will be obliged to publish
any recommendations of the Committee arising from its functions,
for example where these relate to its investment functions, and
its response to them.
The creation of a separate statutory Committee within
HCA will guarantee there will continue to be a strong regulator,
while the link to HCA will help strengthen connections with wider
HCA strategies and in particular the synergies between regulation
and investment.
Housing associations will continue to be subject
to robust economic regulation with a stronger focus on VFM, thereby
maintaining lender confidence, protecting taxpayers and supporting
affordable housing supply.
The Regulation Committee's statutory objectives are
to:
- Encourage and support a supply
of well-managed social housing of appropriate quality and sufficient
to meet reasonable needs;
- Ensure that registered providers are financially
viable and properly managed;
- Encourage investment in social housing - i.e.
investment in new housing and continuing investment in existing
social housing;
- Avoid creating an unreasonable burden on public
funds;
- Guard against the misuse of public funds;
- Encourage delivering the synergies that can be
achieved through the investment and regulation functions of the
HCA
- Regulate in a manner which minimises interference
and is proportionate, consistent, transparent and accountable;
and
- Ensure tenants have the opportunity to be involved
in the management of their social housing.
Integration within the HCA
Although all decisions on regulatory functions will
be the responsibility of the Committee, for administrative purposes
it will be part of the HCA. It will be supported by HCA staff,
including an identified Director of Regulation who will report
to the HCA CEO but have a line of accountability to the Regulation
Committee Chair. Regulation will be resourced through the main
HCA budget. HCA will have a new statutory objective to facilitate
the exercise of regulation through the Committee.
HCA itself is subject to broader change across its
previous activities. A key part of this is the refocusing of the
agency to become a smaller strategic and enabling agency, working
at the local level to support delivery of local ambitions for
growth and renewal. This reform represents a major contribution
towards the Government's aim of increasing democratic and local
accountability and reducing costs. The new regulation function
will fall within that change process and the Chair of regulation
will contribute to that organisational reform as a member of the
Board and on behalf of the Committee.
PERSON SPECIFICATION
This is a demanding, high profile and complex role.
The appointment process to determine the make-up
of the Regulation Committee will ensure that a full range of skills
and experience are secured. However, we would welcome applications
from individuals with the following:
Essential requirements
- A highly credible individual,
able to demonstrate a strong track record of achievement, probably
in financial regulation, the social housing sector and/or other
regulator fields;
- S/he will be used to operating at a national
level and have significant Board level experience, ideally in
a chairmanship role;
- Experience of leading in a successful complex
organisational environment;
- Strong judgement and the ability to balance competing
priorities, such as the need to deliver effective economic regulation
and increased value for money, whilst ensuring a backstop consumer
protection (which is the handling of issues for tenants with registered
social landlords on the most serious service failures, where a
satisfactory resolution cannot be achieved between them);
- Strong influencing and relationship management
skills and an established network of contacts across senior leaders
in the social housing and wider commercial sectors.
- Vision and proven ability to think and act strategically;
- Proven ability to identify and tackle failure,
acting independently as appropriate; and
- A strong awareness of economic and financial
issues particularly as they relate to the social housing sector,
commercial lending and/or the housing market.
Key Milestones
This post is subject to the passage of the Localism
Bill. It is planned that the transfer of functions from TSA to
HCA will take effect from 1 April 2012; however, the aim is for
the Chair of the regulation committee to be in place from autumn
2011 to allow:
- Participation in the recruitment
of the other members of the Regulation Committee;
- Preparations for functions to effectively commence
from the date of transfer; and
- Establishment of any sub-committees as appropriate,
with reference to existing HCA structures and in negotiation with
its chair and chief executive.
The outline timetable is as follows:
| ACTION
| DATE
|
| Applications invited |
Friday 8 July |
| Deadline for applications
| Friday 5 August |
| Sifting | August
|
| Short listing | Early September
|
| Interviews | 26 September
|
| Preferred candidate informed
| Mid October |
| Pre-Appointment Scrutiny
| 31 October |
| Appointment Confirmed |
Early November |
The Recruitment Process
1. The recruitment was run according to the Office of the Commissioner
for Public Appointments (OCPA) code of practice and with the input
of an independent assessor, Moira Rankin.
2. The process was undertaken with the support of
the Whitehall in Industry Group[11]
(WIG). The recruitment notice was published on the Departmental,
the Public Appointments, and WIGs websites, as well as being directly
marketed to WIG's membership of senior public and private sector
members, including their women's and BAME groups.
3. In line with Ministerial decisions and the current
prohibition on marketing, we did not advertise in the press. Also
by avoiding the use of headhunters / specialist recruitment agencies
we were able to limit the cost of the recruitment.
Panel
4. The panel responsible for the sifting and scoring
of candidates and the selection of those for interview comprised
of, Richard McCarthy (Chair), Robert Napier (HCA), Anthony Mayer
(TSA) and Moira Ranking (OCPA). The sift was supported WIG and
the Departmental Sponsorship Division. Decisions were made against
the essential criteria set out at the end of page 8.
Sift
5. Seventeen applications were received (four from
women), from which five candidates were selected for interview.
Interviews
6. All interviews were conducted on 26 September,
lasting around 45 minutes A record was kept of the candidate's
responses and an assessment form, was completed by the Chair and
signed off by the independent assessor.
Results
7. Of the five candidates short-listed for interview,
one was considered appointable when assessed against the eight
core competencies for the role, scoring "high" on five
and "good" on three, significantly higher than any other
candidate.
Preferred candidate
8. The panel's recommendation was to appoint Julian
Ashby. Its overall assessment was:
"Very strong interview, track record and, therefore,
a strong candidate. As identified - highly knowledgeable and experienced".
Julian Ashby is a current member of the TSA Board
and its Deputy Chair. He has significant experience in the sector,
excellent judgement and a track record in tackling failure. He
also has outstanding economic and financial experience and awareness
which the panel felt was critical to developing the new Committee's
focus on economic regulation. Further information about Julian
can be found at Annex A.
11 The Whitehall & Industry Group (WIG) is an independent,
not for profit and non-lobbying membership organisation. WIG provides
tailored interchange and development opportunities through mentoring,
secondments, non-executive appointments and a range of flexible
interchange programmes. Back
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