Decision

Previous regulatory judgement: Ongo Homes Limited (31 August 2022)

Updated 17 January 2024

Applies to England

RSH Narrative Regulatory Judgement

• Provider: Ongo Homes Limited

• Regulatory code: L4486

• Publication date: 31 August 2022

• Governance grade: G1

• Viability grade: V1

• Reason for publication: Governance upgrade

• Regulatory route: In Depth Assessment

This regulatory judgement upgrades our assessment of Ongo Homes Limited’s governance from G2 to G1 and reconfirms its existing viability grade of V1.

Our previous narrative regulatory judgement, published in November 2020, upgraded Ongo Homes Limited (Ongo Homes) from G3 to G2. It recognised that Ongo Homes had strengthened its governance arrangements, but that some aspects still required improvement to support continued compliance.

Based on evidence gained from an In Depth Assessment (IDA), the regulator now has assurance that Ongo Homes has further strengthened its governance arrangements. It has simplified its governance structure and changes to the group’s legal structure are being implemented, which will result in a registered group parent. This is intended to ensure the group structure better aligns with an updated strategy, that places greater emphasis on Ongo Homes’ core purpose. Ongo Homes’ board is focused on delivery of its strategic objectives and improved risk and internal controls arrangements have addressed weaknesses, to enhance the board’s oversight of key risks.

The regulator’s assessment of Ongo Homes’ compliance with the financial viability elements of the Governance and Financial Viability Standard is unchanged. Based on evidence gained from the IDA, the regulator has assurance that its financial plans are consistent with, and support, its strategy. Ongo Homes has an adequately funded business plan, sufficient security in place, and is forecast to continue to meet its financial covenants under a wide range of adverse scenarios.

Other providers included in the judgement

None

About the provider

Origins

Ongo Homes is a charitable registered society, incorporated under the Co-operative and Community Benefit Societies Act 2014. It was formed in 2007 to take transfer of the stock from North Lincolnshire Council. Its principal activity is the management and maintenance of social housing.

Registered Entities

Ongo Homes is the only registered entity in the group.

Unregistered Entities

Ongo Homes wholly owns two unregistered subsidiaries:

• Ongo Home Sales Limited, a dormant private limited company; and

• Ongo Developments Limited, a private limited company responsible for delivering Ongo’s development schemes.

It is currently a subsidiary of an unregistered parent, Ongo Partnership Limited. In addition to Ongo Homes, Ongo Partnership wholly owns two other unregistered subsidiaries:

• Ongo Communities Limited, a registered charity that undertakes community projects; and

• Ongo Commercial Limited, a private limited company which itself owns two subsidiaries that deliver roofing and plumbing services for the group.

Geographic Spread and Scale

Ongo Homes owns 10,096 social housing units which are located in North Lincolnshire, Doncaster, greater Lincolnshire and Bassetlaw.

Staffing and Turnover

Ongo Homes employs a full-time equivalent of 214.5 staff. Its turnover for the year ended 31 March 2022 was £50.6m.^{[footnote 1]}

Development

Ongo Homes plans to develop 225 homes per year for the next ten years.

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.

1. Based on unaudited 2021/22 accounts. ↩