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Grasp opportunities

"When others fail to deliver, it must not be said that we were part of the problem."

Chan Kataria, emh group Chief Executive

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Last year saw the biggest combination of factors that will change the nature of our sector for years to come.

The advent of rent cuts, welfare reforms and reduction in affordable rented housing investment is clearly a blow for the sector and has been seen by many as an end to social housing as we know it.

If it goes ahead in its current form, the application of Local Housing Allowances to supported and specialist housing will lead to a demise of those schemes. It goes without saying that the negative impact of this will be immense with significant additional costs borne by the health, welfare and justice systems.

However, it is not enough to complain. Amid all the doom and gloom, there are opportunities available that we need to grasp with both hands. To do otherwise would be tantamount to letting down those who look to us for solutions, including our customers, communities and local partners. The two opportunities I want to single out are those relating to housing supply and devolution. Let us take each one in turn.

We know that the housing market is a classic case of market failure. In the traditional economic sense, this means that market-driven outcomes lead to socially sub-optimal outcomes. The root cause of this market failure is, of course, a chronic imbalance between housing demand and housing supply and is a classic case for government intervention.

This is why the target in the Autumn Statement to build one million homes over the next five years is positive and we should do everything possible to play our part in delivering this. Of course, it is an aspiration and unlikely to be met in full.

Apart from planning and land supply constraints, it is difficult to see how such numbers can be delivered in the context of a building industry dominated by large builders who have no interest in releasing large land banks to produce such volumes.

This makes it all the more necessary for our sector to step up and give the government a get-out clause. For when others fail to deliver, it must not be said that we were part of the problem.

The government’s focus is on homeownership. This is not new to us as over the years, we have successfully delivered a whole range of low-cost and shared equity housing products and will continue to do so.

We know that for many this is the only route to homeownership and we are ideally placed to play our part in this. This does not have to be at the expense of affordable rented housing, which we will continue to deliver through our own resources and support from other partners.

In any case, we don’t have much choice. The benefits of actively contributing to the delivery of this government’s housing supply objective are many. Failure to do so will lead to further isolation from government and further attacks on our sector.
Then there is the issue of devolution. Greater powers and funding to combined authorities provides opportunities for our sector to contribute to local growth and investment. Along with housing investment, our work on health, care and apprenticeships contributes to the local investment, jobs and growth agenda.

Although national government does not always value our non-core added value activities, these are the very activities that will get us through the door in any local devolution deals. The social impact work that we do is the bedrock of Placeshapers’ philosophy and one that we should not distance ourselves from as they will open doors in the future.

We know our local markets, communities and civic leaders. Housing associations have a great deal of experience and expertise in building local relationships and developing joined up solutions.

Successful local partnerships will be based on practical solutions to address actual problems. In this context, it is more important for us to make a case to local authorities and clinical commissioning groups (CCGs), for instance to supplement our funding for an extra care scheme or reablement project, than to obsess endlessly about a place on their governance structures.

With around five more annual budgets still to come between now and the next general election, we obviously cannot rule out further adverse policy changes from this government. The only meaningful strategy is to make the most of the opportunities available to us that meet our objectives but at the same time help to address the government’s agenda.

OUR GROUP