Decision

Broadacres Housing Association Limited (LH4014) - Regulatory Judgement: 30 October 2024

Updated 30 October 2024

Applies to England

Our Judgement

	Grade/Judgement	Change	Date of assessment
Consumer	C2 Our judgement is that there are some weaknesses in the landlord delivering the outcomes of the consumer standards and improvement is needed.	First grading	October 2024
Governance	G2 Our judgement is that the landlord meets our governance requirements but needs to improve some aspects of its governance arrangements to support continued compliance.	Downgrade	October 2024
Viability	V2 Our judgement is that the landlord meets our viability requirements. It has the financial capacity to deal with a reasonable range of adverse scenarios but needs to manage material risks to ensure continued compliance.	Assessed and unchanged	October 2024

Reason for publication

We are publishing a regulatory judgement for Broadacres Housing Association Limited (Broadacres) following an inspection completed in October 2024.

This regulatory judgement confirms a consumer grading of C2, a governance downgrade to G2 and a financial viability grading of V2.

Prior to this regulatory judgement, the governance and financial viability gradings for Broadacres were last updated in January 2024 following a stability check to confirm a G1 grade for governance and a V2 grade for financial viability. This is the first time we have issued a consumer grade in relation to this landlord.

Summary of the decision

From the evidence and assurance gained during the inspection it is our judgement that there are some weaknesses in how Broadacres is delivering the outcomes of the consumer standards and improvement is needed, specifically in relation to the governance oversight of outcomes in our Safety and Quality Standard, and our Transparency, Influence and Accountability Standard. Based on this assessment, we have concluded a C2 grade for Broadacres.

Our judgement is that Broadacres meets our governance requirements although improvement is needed to support continued compliance, specifically in relation to board oversight of risk and the quality of stress testing. Based on this assessment, we have concluded a G2 grade for Broadacres.

Our judgement is that Broadacres meets our financial viability requirements and has the financial capacity to deal with a reasonable range of adverse scenarios, but it needs to manage material risks to ensure continued compliance. However, Broadacres’ financial profile reflects the additional investment it is making in tenants’ homes alongside the development and sale of new homes. Broadacres has provided appropriate assurance that it has access to sufficient liquidity and adequate funding in place. Based on this assessment, we have concluded a V2 grade for Broadacres.

How we reached our judgement

We carried out an inspection of Broadacres to assess how well Broadacres is delivering the outcomes of the consumer standards and meeting our governance and financial viability requirements, as part of our planned regulatory inspection programme. During the inspection, we considered all four of the consumer standards: Neighbourhood and Community Standard, Safety and Quality Standard, Tenancy Standard, and the Transparency, Influence and Accountability Standard.

During the inspection we observed a board meeting and customer scrutiny panel, spoke to tenants, held meetings with Broadacres management and its non-executive directors. We also reviewed a wide range of documents provided by Broadacres.

Our regulatory judgement is based on all the relevant information we obtained during the inspection as well as analysis of information supplied by Broadacres in its regulatory returns and other regulatory engagement activity.

Summary of findings  

Consumer – C2 – October 2024

During the inspection Broadacres provided evidence-based assurance that it has appropriate systems in place to ensure the health and safety of its tenants in their homes and associated communal areas. However, we found weaknesses in Broadacres’ oversight of its assurance and specifically the reporting in place was not sufficient to facilitate adequate Board oversight and challenge of its health and safety performance.

We found evidence that Broadacres maintains an accurate record of the condition of its homes at an individual property level through physical surveys of all its homes and has a process for keeping this information up to date. The inspection identified that Broadacres has sought external specialist assurance in this area which included considering how best to make sure the information that it holds is accurate, consistent and complete.

Broadacres demonstrated that it provides an effective, efficient and timely repairs service to tenants. It has made proactive, tenant focused improvements to the repairs service to improve outcomes for tenants.

We found evidence of weaknesses in how Broadacres monitors and tackles anti-social behaviour. Improvement is needed to evidence effective partnership working and to increase the level of satisfaction with the service provided. Broadacres has recently completed a full anti-social behaviour service review which identified specific areas for change and an action plan is in place. We saw some evidence that these actions are beginning to have a positive impact on performance.

In relation to the Transparency, Influence and Accountability Standard, we found evidence that Broadacres had identified weaknesses in how it handles tenant complaints and made improvements as a result.

We gained assurance that Broadacres treats its tenants with fairness and respect. However, Broadacres holds limited information about its tenants, including protected characteristics, and we found limited evidence of Broadacres using this information to ensure its housing and landlord services deliver equitable outcomes for tenants. Broadacres has recognised that it needs to improve the breadth and quality of information it holds about the diverse needs of its tenants and is taking action to address this.

We found evidence that tenants have a wide range of meaningful opportunities to influence and scrutinise Broadacres strategies, policies and services. These opportunities have directly influenced how Broadacres delivers services to improve outcomes for tenants, including recent opportunities to scrutinise grounds maintenance and complaints. Tenant engagement is clearly structured, from a local level through to board level, and well supported by Broadacres staff.

In relation to the Tenancy Standard, our inspection found evidence that Broadacres approach to lettings and allocations is transparent, that measures are in place to ensure terms of tenancy are appropriate and meet the needs of tenants. There are a range of measures in place to support tenancy sustainment including successfully helping tenants to access financial support.

Governance – G2 – October 2024

Based on the evidence gained from the inspection there is assurance that Broadacres governance arrangements enable it to effectively manage its risk and adequately control the organisation, allowing it to deliver its objectives. Broadacres board demonstrated that it provides challenge on performance against the organisation’s strategic targets, financial position, and consideration of risk appetite in strategic decision making.

Broadacres risk management framework was being reviewed internally during the period of this inspection. We found evidence that Broadacres approach to risk management has been strengthened in recent months, including with the introduction of key risk indicators. The risk management framework is aligned to Broadacres strategic risks. There is however further improvement needed to ensure the framework is implemented effectively and Broadacres board is assured on the adequacy and effectiveness of its internal controls.

The board’s oversight of landlord health and safety risk and compliance is limited, with improvements needed in the regularity and detail of board’s scrutiny of compliance and performance. Broadacres risk register includes controls such as quarterly landlord health and safety reporting for board, but this is not currently being implemented in sufficient detail.

We found evidence of weakness in Broadacres approach to stress testing. The information provided to the board in the most recent stress testing exercise did not include the full selection of stresses or quantified mitigations required to give the board sufficient assurance. We identified a level of error and inconsistency within the stress testing and mitigation reporting to board that limited the board’s role in managing risk and gaining assurance that Broadacres can withstand a reasonable range of adverse scenarios.

Broadacres has provided appropriate assurance that its board proactively reviews its approach to delivering against its purpose and regularly considers alternative options to ensure it is achieving value for money in making best use of resources.

Board member skills, experience and knowledge are aligned with the activities of the organisation and there is a structured approach to developing and appraising skills to support succession planning. We have seen evidence of this through board observation, meetings with non-executive directors and the executive team, as well as reviewing relevant documents including meeting minutes.

Continuing governance improvement is evidenced through annual effectiveness reviews and triennial in-depth external governance reviews. The most recent external review of Broadacres governance took place in February 2023.

Viability – V2 – October 2024

Based on the evidence gained through the inspection we have concluded that there is appropriate assurance that Broadacres financial plans are consistent with and support its financial strategy. Broadacres has appropriately evidenced that it has an adequately funded business plan and sufficient security in place to support its financial plans. Broadacres board has effective oversight of covenant compliance with actual and projected covenant performance reported quarterly.

Broadacres is investing in its existing homes to improve the quality and energy efficiency while continuing to develop new homes. In addition to this investment, Broadacres anticipates generating surpluses from the sale of new homes.  Broadacres is not reliant on these sales, however they represent an uncertain cashflow for the organisation and a financial risk it needs to manage. We have assurance that Broadacres has reporting and oversight in place to manage the risks of its sales programme.

Background to the judgement

About the landlord

Broadacres is an exempt charity under the Co-operative and Community Benefit Societies Act 2014. Broadacres operates across predominately in North Yorkshire with some homes East and West Yorkshire, as well as County Durham.

Broadacres is the only RSH registered entity in its group and is a non-profit registered provider of social housing. Broadacres has three unregistered subsidiaries in its group: Broadacres Services Limited provides development services; Mulberry Homes Yorkshire Limited develops homes for private sale; Marketgate Residential Management Company Limited provides property management services.

Broadacres owns and manages around 6,900 homes.

At 31 March 2024, Broadacres employed 380 full-time equivalent staff and group turnover was £52.4m. Broadacres plans to develop 1,000 homes between 2023 and 2028 and upgrade all their homes to at least SAP C by 2028.

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. 

 

Further information 

• Regulating the standards 

• Regulatory standards for landlords