Allnutt Mill Housing Co-operative Limited (C4108) - Regulatory Judgement: 15 January 2025
Updated 15 January 2025
Applies to England
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Our Judgement
Reason for publication
We are publishing a regulatory judgement for Allnutt Mill Housing Co-operative Limited (Allnutt Mill) following responsive engagement and an investigation relating to potentially serious governance and financial viability failings.
As a result of our investigation, we have concluded that Allnutt Mill is not delivering the required outcomes of the Governance and Financial Viability Standard.
As Allnutt Mill owns fewer than 1,000 social homes, it is a small landlord. We do not issue grades to small landlords and only publish or update regulatory judgements where we consider there to be serious weaknesses or failings in a landlord’s delivery of the outcomes of our standards.
Summary of the decision
From the evidence gained during our investigation, it is our judgement that Allnutt Mill has not managed its resources effectively to ensure its viability can be maintained, and does not have effective governance arrangements.
Allnutt Mill has not been able to demonstrate that it has managed its affairs with an appropriate degree of skill, independence, diligence, effectiveness, prudence and foresight. This has led to a failure to ensure it has an appropriate, robust and prudent business planning, risk and internal control framework in place that ensures access to sufficient liquidity at all times.
How we reached our judgement
Our responsive engagement with Allnutt Mill began in November 2024, following information being provided to us via a third party in agreement with Allnutt Mill. We then began an investigation into potentially serious governance and financial viability failings by Allnutt Mill. Our engagement with Allnutt Mill has included discussions with its Chair and a review of documentation provided by Allnutt Mill. Our judgement is based on all of the relevant information we obtained during the investigation and responsive engagement process together with information from regular regulatory returns.
Summary of findings
From the evidence gained from the investigation, it is our judgement that Allnutt Mill has not demonstrated appropriate internal control over its spending which has led to a significant deterioration of its liquidity position.
Allnutt Mill uses a managing agent to undertake some functions of its business including the preparation of ongoing financial information and certain aspects of procurement. Allnutt Mill has failed to ensure appropriate oversight of its performance against budget through this arrangement, and has incurred material levels of unbudgeted expenditure over a period of time. The inadequacies in financial monitoring and committee scrutiny has resulted in Allnutt Mill now having to manage its cash carefully in order to meet its obligations.
Landlords are expected to operate effective governance arrangements that deliver their aims, objectives and intended outcomes for tenants, and are expected to be accountable to tenants, the regulator and relevant stakeholders. We have concluded that Allnutt Mill does not currently have appropriate systems in place to monitor and accurately report delivery of its plans.
During our investigation Allnutt Mill has been unable to provide routine financial information, including an up to date cashflow forecast or a complete understanding of its current liabilities. It is therefore unable to demonstrate an ability to manage its future liquidity position appropriately and its committee is unable to make informed strategic decisions.
Landlords are expected to manage their resources effectively to ensure their financial viability is maintained and that social housing assets are not put at undue risk. The lack of effective committee oversight and management of a key organisational risk is a fundamental failure of governance and this has led to Allnutt Mill not having the ability to demonstrate its ongoing financial viability.
We will continue to work intensively with Allnutt Mill as it works to address the issues identified in this judgement. Allnutt Mill has shown a willingness to work with us.
Background to the judgement
About the landlord
Allnutt Mill was registered in September 1996 and designated as a not-for-profit provider. It is a fully mutual housing cooperative, which means it is owned by its members and is directed by a management committee drawn from its membership.
Allnutt Mill has 46 social housing homes, located in Maidstone, Kent and is classed by us as a small landlord.
Allnutt Mill generated a turnover of £326k in the year ended 31 March 2024 and has no employees.
Our role and regulatory approach
We regulate for a viable, efficient, and well governed social housing sector able to deliver quality homes and services for current and future tenants.
We regulate at the landlord level to drive improvement in how landlords operate. By landlord we mean a registered provider of social housing. These can either be local authorities, or private registered providers (other organisations registered with us such as non-profit housing associations, co-operatives, or profit-making organisations).
We set standards which state outcomes that landlords must deliver. The outcomes of our standards include both the required outcomes and specific expectations we set. Where we find there are significant failures in landlords which we consider to be material to the landlord’s delivery of those outcomes, we hold them to account. Ultimately this provides protection for tenants’ homes and services and achieves better outcomes for current and future tenants. It also contributes to a sustainable sector which can attract strong investment.
We have a different role for regulating local authorities than for other landlords. This is because we have a narrower role for local authorities and the Governance and Financial Viability Standard, and Value for Money Standard do not apply. Further detail on which standards apply to different landlords can be found on our standards page.
We assess the performance of landlords through inspections and by reviewing data that landlords are required to submit to us. In-Depth Assessments (IDAs) were one of our previous assessment processes, which are now replaced by our new inspections programme from 1 April 2024. We also respond where there is an issue or a potential issue that may be material to a landlord’s delivery of the outcomes of our standards. We publish regulatory judgements that describe our view of landlords’ performance with our standards. We also publish grades for landlords with more than 1,000 social housing homes.
The Housing Ombudsman deals with individual complaints. When individual complaints are referred to us, we investigate if we consider that the issue may be material to a landlord’s delivery of the outcomes of our standards.
For more information about our approach to regulation, please see Regulating the standards.