Decision

Previous regulatory judgement: Broadland Housing Association Limited (14 December 2022)

Updated 15 November 2023

Applies to England

RSH Narrative Regulatory Judgement

• Provider: Broadland Housing Association Limited
• Regulatory code: L0026
• Publication date: 14 December 2022
• Governance grade: G1
• Viability grade: V2
• Reason for publication: Changed basis for viability grade
• Regulatory route: Stability Check

Regulatory judgement

This judgement confirms the regulator’s existing assessment of Broadland Housing Association Limited’s governance and financial viability grades (G1/V2).

The regulator has assurance that Broadland Housing Association Limited (Broadland) complies with the financial viability elements of the Governance and Financial Viability Standard. Its financial plans are consistent with, and support, its financial strategy. It has effective treasury management arrangements and has ensured access to an adequate level of liquidity. It also forecasts ongoing compliance with key financial covenants.

Broadland does, however, have material risks which it continues to need to manage to maintain compliance. A significant proportion of its revenue is derived from non-social housing activities, including homes for outright sale. This gives rise to downside risks, including exposure to the housing market. In addition, increased investment in its existing stock weakens interest cover. These factors, coupled with the current economic uncertainty in relation to interest rates and inflation, reduce Broadland’s capacity to respond to adverse events.

The regulator’s assessment of Broadland’s compliance with the governance elements of the Governance and Financial Viability Standard remains unchanged. On the basis of the Stability Check, the regulator has concluded that there is no evidence to indicate a change to Broadland’s current governance grading.

Other providers included in the judgement

None

About the provider

Origins

Broadland is a charitable non-profit making community benefit society and registered provider. Founded in 1963, its principal activities are the development and management of affordable housing, supported housing and housing for older people.

Registered Entities

Broadland is the only registered entity in the group.

Unregistered Entities

Broadland is the parent of three unregistered subsidiaries:

• Broadland St Benedicts Limited is a private limited company established to generate surpluses from the development of homes for market sale;
• Broadland Development Services Limited is a private limited company that procures development of new build homes for other group members; and
• Broadland Meridian Limited is a registered charity that provides community grants to organisations.

Geographic Spread and Scale

The group owns or manages around 5,600 units, the majority of which are general needs homes let at social rents. There are concentrations of homes around the Norwich and North Suffolk areas, but also a wide distribution of stock across Norfolk.

Staffing and Turnover

The group employs 221 staff on a full-time equivalent basis. Group turnover for the year ended 31 March 2022 was £42.8m.

Development

Broadland plans to develop around 650 social homes and 200 homes for outright sale between 2023 and 2027.

About our judgements

Key to Grades

Governance:

	Compliant
G1	The provider meets our governance requirements.
G2	The provider meets our governance requirements but needs to improve some aspects of its governance arrangements to support continued compliance.

	Non-compliant
G3	The provider does not meet our governance requirements. There are issues of serious regulatory concern and in agreement with us the provider is working to improve its position.
G4	The provider does not meet our governance requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Viability:

	Compliant
V1	The provider meets our viability requirements and has the financial capacity to deal with a wide range of adverse scenarios.
V2	The provider 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.

	Non-compliant
V3	The provider does not meet our viability requirements. There are issues of serious regulatory concern and, in agreement with us, the provider is working to improve its position.
V4	The provider does not meet our viability requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Definitions of Regulatory Routes

In Depth Assessment (IDA): An IDA is a bespoke assessment of a provider’s viability and governance, including its approach to value for money. It involves on-site work and considers in detail a provider’s ability to meet its financial obligations and the effectiveness of its governance structures and processes.

Stability Checks: Based primarily on information supplied through regulatory returns, a Stability Check is an annual review of a provider’s financial position and its latest business plan. The review is focused on determining if there is evidence to indicate a provider’s current judgements merit reconsideration.

Reactive Engagement: Reactive engagement is unplanned work which is triggered by new information or a developing situation which may have implications for a provider’s current regulatory judgement.

Stability Checks and Reactive Engagement: In some cases, we will publish narrative regulatory judgements which combine evidence gained from both Stability Checks and Reactive Engagement.

For further details about these processes, please see Regulating the Standards.