Clause 43
Housing and Regeneration Bill
10:15 am
Nick Raynsford (Greenwich and Woolwich, Labour)
My question to the Minister is on a different tack. I assume that the main purpose of clause 43 is to allow the agency to give guidance to providers and others involved in the provision of social housing and regeneration in the way that both the Housing Corporation and English Partnerships do at present.
Within the current arrangements, another area has always been problematic: the relationship between the regulatory function of the Housing Corporation and its investment function. The question has always been how to maintain a proper distinction between those two functions, but without allowing nonsense to develop whereby the investment side puts money into an organisation that is subject to concern from the regulatory side. That will be part of the framework under the new arrangements whereby the regulator will be a different body from the funder and there will at times be questions about whether it is sensible for regulatory action to be taken in respect of an organisation that is seen to be in difficulty.
We know that in general the record over the past 30 years or so has been good in terms of successful housing associations. When problems have arisen, the Housing Corporation has been able to intervene and the problems have generally been overcome without loss of public money or threat to tenants. However, as the recent case involving Ujima housing association highlighted, unhappy circumstances can rapidly develop in which an association that had previously been regarded as a safe recipient of investment finance may seem to be getting into financial difficulties or to be acting not entirely properly in its financial decisions, and regulatory intervention may become necessary. In the Ujima case, questions were asked about whether action was taken early enough when the first warning signals appeared about the organisation not performing as well as it should. My question is: does guidance in clause 43 extend to guidance being issued by the agency to the regulator in such circumstances?
It will be essential to have a clear understanding and a mechanism to ensure the sharing of information between the two bodies, where there are doubts about the performance of individual bodies, and where regulatory action may be necessary. If it is not provided under this part of the Bill, where will arrangements be defined to ensure that there can be a proper and appropriate system for sharing information between the agency and the regulator in such circumstances?