South Tyneside Council reveals plans to take back full control of its housing

At a meeting this week, senior councillors took a ‘minded to’ decision to return the delivery of housing and related services to direct council control – a move which could save taxpayers’ money in the long-term.

It follows an independent review of council housing, in anticipation of revised regulatory and legislative requirements, and to ensure the best outcomes for residents, the borough council has said.

Subject to a ballot of tenants and leaseholders, services could transfer over from South Tyneside Homes, the council’s ‘wholly owned’ arms-length management organisation (ALMO).

South Tyneside Homes was established in April, 2006, in response to the delivery of the ‘Decent Homes’ standard and to act as a mechanism to gain additional government funding.

The ALMO delivers a range of services in addition to core housing functions, however, the council remains the landlord in respect of all tenants and leaseholders, including for 18,000 council houses.

A report presented to South Tyneside Council’s cabinet said the “landscape for social housing has changed considerably” and that there are “currently less than 20 ALMOs managing housing services”.

At a special cabinet meeting at South Shields Town Hall on December 13, 2023, South Tyneside Council’s cabinet agreed to a number of recommendations.

This included accepting the conclusions and recommendations from an independent review and noting that “doing nothing is not an option”.

Councillors agreed to a consultation starting in early-2024 with current council tenants and leaseholders.

This consultation aims to gather feedback and views on bringing council housing management back in-house before a final cabinet decision on the council’s future model of housing delivery.

It was also agreed that ‘interim’ governance arrangements would be put in place to “ensure shared structure and operational oversight to strengthen governance, specifically around regulatory compliance”.

Councillor Jim Foreman, cabinet member for housing and community safety, answered several questions from cabinet members at the meeting.

It was revealed that the ‘test of opinion’ ballot would be undertaken by an independent company and that results would return to cabinet next year.

If there is support, the council could bring housing ‘in-house’ in Autumn, 2024, at the earliest.

This change would be subject to a six-month notice period linked to ‘terminating’ the existing management agreement between South Tyneside Homes and South Tyneside Council.

Councillors also heard that the changes, if approved, would allow the council to take “direct control” of housing management and to better prepare for new inspection arrangements.

It was noted that the independent review had highlighted strengths around the current housing delivery model, specifically around building compliance and some asset management services.

However, Cllr Foreman said the report also noted some “weaknesses and missed opportunities” around people-based services and “client tenant satisfaction scores”.

Specific issues highlighted included increased service complaints, the “fragmented” nature of people-based services and the need to “strengthen and simplify” governance arrangements.

Cllr Foreman added the review made clear that “regardless of the future management option chosen, there is scope for rethinking and better connecting service provision and maximising the effectiveness, efficiency and the outcomes for borough residents”.

Cllr Foreman, speaking after the meeting, said: “Housing is about far more than bricks and mortar, it’s a gateway to many other services and it’s crucial that we adopt an holistic approach to provide more effective prevention, intervention and support for residents.

“The social housing sector is operating in a new landscape, with increased scrutiny, significant regulatory change and the implementation of a new inspection regime.

“The review has given us the opportunity to evaluate our council housing services and identify improvements that will make a difference to tenants.

“Since it was established in 2006, South Tyneside Homes has brought thousands of properties up to Decent Homes standard and beyond, improving conditions and enhancing residents’ quality of life.

“We know from ward visits and walkabouts that residents continue to really value the work being done in their homes and communities.

“However, tenant satisfaction is mixed and it’s important that as a responsible landlord we listen to and act upon their views”.

The independent review was carried out by consultants at Campbell Tickell, who following their investigation, proposed a number of options for the future of housing delivery services.

The review recommended bringing housing services back under direct council management, with an integrated leadership structure as an interim measure.

Cabinet has approved the recommendations, however complete control is subject to a formal six-week consultation period with tenants and leaseholders, which will take place in 2024.

It is understood that South Tyneside Homes staff will be directly informed about the cabinet decision and next steps for the organisation.

Cllr Foreman added: “Bringing council housing back in-house would give us the opportunity to ensure services are joined up and streamlined, helping us deliver our vision of building strong communities where people are healthy and well.

“It would also put the borough in a stronger position with regards to devolution, mirroring other local authorities in the region who have brought housing services back under one roof.”

According to a cabinet report, the housing review highlighted that there would be an “estimated one-off £1.5 million cost to the council to bring services back in-house”.

The report adds: “However, there is an anticipated annual saving of £850,000 from management overheads with the removal of the managementagreement and bringing services back in-house.

“These additional savings, in the long-term, would be reinvested into council homes”.