Section 219 HOUSING AND REGENERATION ACT 2008 (“the Act”)

Question

Accepted Answer

Introduction

A registered provider is responsible for ensuring that it manages itself effectively, achieves the standards set by the regulator, and engages positively with the regulator’s regulatory framework. Where a failure against a standard or other problem has been identified, the regulator expects a registered provider to respond in a prompt and effective manner. It may be necessary for the regulator to step in and exercise its powers under section 219 of the Act when a provider fails to do so.

Sections 219 to 225 of the Act allow the regulator to require a registered provider to take specified action to resolve a specified failure or other problem by issue of an enforcement notice. The regulator has published guidance on its use of this power which can be found here.

The Regulatory Standards that registered providers of social housing are required to meet can be found here together with our approach to regulating the standards.

Grounds for issuing this enforcement notice

On 28 November 2018 and 13 March 2019 Regulatory Notices were published^{[footnote 1]} concluding Kinsman Housing Limited (Kinsman Housing) was non-compliant with the Governance and Financial Viability Standard (the Standard) and breached the Home Standard respectively. Following engagement with Kinsman Housing, the regulator has assessed actions taken by Kinsman Housing to address the issues raised in the regulatory notices and continues to lack assurance that Kinsman Housing complies with the Standard in that it is unable to:

ensure effective governance arrangements that deliver its aims and objectives and intended outcomes for tenants and potential tenants in an effective, transparent and accountable manner;
manage its affairs with an appropriate degree of skill, independence, diligence, effectiveness, prudence and foresight; and
ensure that the arrangements it has entered into do not inappropriately advance the interests of third parties or are arrangements that the regulator could reasonably assume were for such purposes.

Further, the regulator lacks assurance that Kinsman Housing:

manages its resources effectively to ensure its viability is maintained while ensuring that social housing assets are not put at undue risk;
assesses, manages and addresses risks to ensure its long-term viability, including ensuring social assets are protected before taking on new liabilities, and ensuring it understands and manages the likely impact on current and future business and regulatory compliance.

In relation to the Home Standard, Kinsman Housing has failed to meet all applicable statutory requirements that provide for the health and safety of the occupants in their homes. This relates to the lack of assurance to adequately remedy the breach set out in the Regulatory Notice dated 13 March 2019.

In considering whether to serve an enforcement notice, the regulator has considered section 218 of the Act and concluded this is a serious and recurrent case of non-compliance where Kinsman Housing has failed to address the breach of the Regulatory Standards in a prompt and effective manner. The regulator has also taken account of the regulator’s fundamental objectives under the Act and considers the issuing of an enforcement notice appropriate and proportionate in circumstances where in the judgement of the regulator, Kinsman Housing has been unwilling and / or unable to address its failures to meet the Regulatory Standards.

The regulator issues this enforcement notice to Kinsman Housing by virtue of its powers under sections 219 to 225 of the Act. Specifically, the grounds for issuing an enforcement notice are under section 220 of the Act:

Case 1 – that Kinsman Housing has failed to meet the requirements of the Standard and Home Standard applicable to it under sections 193 and 194 of the Act.

Direction

The regulator directs that Kinsman Housing take the following actions:

To a scope agreed with the regulator, Kinsman Housing must commission an independent appraisal (the Appraisal), to be carried out by a party with relevant skills and expertise, of options to address its continued non-compliance with the Standard and lack of assurance that it has remedied the breach of the Home Standard.
Kinsman Housing must ensure the Appraisal includes (but is not limited to) a review of the following options and actions:

a. Renegotiation and / or exit from the arrangements Kinsman Housing has entered into (including but not limited to Declarations of Trust and Management agreements) over its social housing assets;

b. Voluntary de-registration as a social housing provider or winding down (followed by de-registration); and

c. Whether the remedial and repair works carried out in its homes have satisfactorily addressed the issues of concern set out in the Regulatory Notice dated 13 March 2019, and whether Kinsman Housing is able to supply adequate assurance to the regulator that the property is safe for tenants and residents.
Based on the outcome of the Appraisal, Kinsman Housing’s board shall develop an action plan and timetable to ensure compliance with the Regulatory Standards for the regulator’s consideration.
Kinsman Housing must provide the following to the regulator:

a. the draft written scope of the commission of the Appraisal and list of proposed parties to carry out the Appraisal no later than 21 days from the date of this Notice;

b. the completed Appraisal report no later than two months from the date the regulator approves scope of the Appraisal; and

c. the board approved action plan based on recommendations arising from the Appraisal, timescales for implementation and minutes of board discussions relating to the Appraisal outcome no later than one month from the completion of the Appraisal.
Kinsman Housing is required to engage with the regulator before entering any transactions to acquire further social housing assets, as soon as reasonably practicable, while a non-compliant regulatory notice remains in place.

The regulator expects Kinsman Housing to co-operate fully with the regulator and to co-ordinate its communications strategy on all matters relating to enforcement actions with the regulator, and to give the regulator the opportunity to comment on the content and timing of any news releases or other public statements.

Further Information

In coming to the decision set out in this Notice, the regulator has taken into account all relevant matters and representations referred to in the regulatory framework and Annex 1 of the regulator’s ‘Guidance on the regulator’s approach to intervention, enforcement and use of powers‘ with particular reference to ‘Guidance note 9’.
Please note that a registered provider that is given an enforcement notice may appeal against it to the High Court.
The regulator may withdraw the enforcement notice at any time by giving notice to the registered provider.
Should Kinsman Housing fail to comply with this enforcement notice, the regulator may consider exercising other regulatory or enforcement powers.
The regulator may choose to publicise the serving of this enforcement notice.
Any information or correspondence pertaining to this enforcement notice should be sent to the regulator, addressed to:

Harold Brown

Senior Assistant Director, Investigation and Enforcement

Regulator of Social Housing

Level 1A – City Tower

Piccadilly Plaza

Manchester M1 4BT

Signed on behalf of the regulator

Harold Brown Senior Assistant Director, Investigation and Enforcement

Date of enforcement notice: 10 February 2023

Regulatory Notice: Kinsman Housing Limited (28 November 2018) - GOV.UK, and Regulatory Notice: Kinsman Housing Limited (13 March 2019) - GOV.UK ↩

Withdrawn Enforcement Notice: Kinsman Housing Limited (15 February 2023)

This decision was withdrawn on 12 September 2023

Applies to England

Withdrawn on 8 September 2023: Kinsman Housing Limited was de-registered on 7 September 2023

ENFORCEMENT NOTICE