Housing associations’ social mission has been debated at length in the past few years. For some, including Halton Housing Trust, changes in the Housing and Planning Act, passed in May, to the way associations are governed could make our work even more difficult.
The act replaces the existing regulatory regime with a system that will give housing associations greater freedom and control over their businesses, particularly when they are considering group restructuring and mergers. The act also removes the need for associations to get permission from the Homes and Communities Agency (HCA) before disposing of stock. This could give housing associations greater flexibility when managing assets and could cut red tape, enabling housing associations that have bought properties from local authorities to potentially raise more finance by revaluing their assets.
But there is also a catch for housing associations like ourselves that are registered charities – about a third of all associations. For those associations, the provisions of the Charities Act 2011 will apply unless some alternative arrangement is made with the Charity Commission. This means that the HCA will no longer need to approve sales, but the Charity Commission will have to approve them. We are concerned that this could hinder effective asset management and put us at a disadvantage.
Some charitable housing associations have reconstituted themselves as community benefit societies. This means they are still charities but are no longer subject to regulation by the Charity Commission.
Quite rightly the government does not believe there should be less restraint on the disposal of charities’ assets. The Law Commission is looking at charity law and regulation, specifically regarding the asset disposal regime. Its initial recommendations may resolve the issues housing associations might face under the Charity Commission disposals regime.
However, we all know how draft proposals can change, so we will be keeping a watchful eye as this develops up until the publication of the commission’s final recommendations and a draft bill at the end of 2016.
We need to keep our options open. At Halton Housing Trust we are working closely with our legal advisors, our board, the National Housing Federation and other stakeholders to ensure we are able to respond appropriately.
For us, a charity stops being a charity when the restrictions placed upon it prevent it being able to act in the best interests to pursue its original charitable objectives.
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