Agenda item

The purpose of the report is to notify the Audit & Standards Advisory Committee of the circumstance surrounding the necessity to self-refer to the Regulator of Social Housing for breaches in compliance with building safety, potentially breaching the Quality and Safety Standard.

The Chair welcomed Thomas Cattermole (Corporate Director Residents and Housing Services) and Spencer Randolph (Director Housing Services) who he advised had been invited to update the Committee on the circumstance surrounding the Council’s self-referral to the Regulator of Social Housing for potential breaches in compliance relating to the Quality and Safety Standard and on the measures being taken in response in order to develop a Performance Improvement Plan.

In introducing the report, members were advised of the background to the self-referral as a result of it having been identified that the True Compliance software utilised by the council had been updated incorrectly.  This included up to 12,500 fire actions having been identified as wrongly updated to indicate that works had been completed, but which were missing the required supporting evidence. In addition, the council had been unable to reconcile performance data on asbestos management, water safety and detectors for smoke and carbon monoxide.  Having identified the issue, advice had immediately been sought on appropriate corrective steps from a building safety specialist who dealt with the management and recovery of regulatory breaches and, in line with the requirements of the Social Housing (Regulations) Act 2023 around transparency, the advice had been to self-refer to the Regulator of Social Housing.  Having made the referral, further details had been sought by the Regulator on performance data relating to building safety and stock condition, which the council had been unable to provide in a comprehensive manner. Whilst the council reported it held stock data on 95% of its homes it had subsequently been identified that it did not hold recorded survey information on over 50% of these properties.

As a result of the issues highlighted the Regulator had therefore issued a regulatory judgement with the Council graded C3 (Serious failings identified, and significant improvements needed).

In response to the position identified and judgement issued the council had initated a number of actions, which the Committee were advised had included:

• appointing advisors that specialised in building safety and assisting landlords in meeting the requirements and outcomes set out in the Social Housing (Regulations) Act 2023, in particular The Quality and Safety Standard.  The specialist advisors were now in the process of undertaking an initial assessment of the council’s compliance arrangements, in preparation for an audit to confirm the true position on the ‘Big 8’ areas of compliance – Fire Safety, Gas Safety, Electrical Safety, Water Safety, Asbestos Management, Mechanical and Engineering (Lifts), damp and mould & Smoke and Carbon Monoxide (CO) detectors.  Members were advised that the audit would comprise the first part of three pieces of work required to return the council to a position of compliance.

• The second piece of work would consist of a Root Cause Analysis (RCA) of the working practices and arrangements that had resulted in the breaches.

• The third piece of work, which was due to commence shortly and run alongside the audit and the RCA, was the development of a Compliance Recovery Programme with each element of activity identified contributing towards the establishment of a Performance Improvement Plan, as required by the Regulator.  It was noted this would be subject to ongoing review with the Regulator to track progress and provide assurance on the improvements needing to be delivered.

Following the update, the Chair thanked Thomas Cattermole and Spencer Randolph for their report.  In welcoming the transparency provided and noting the Committee’s role in seeking the necessary assurance on the measures established to address the compliance issues and risks identified, questions and comments were then sought from the Committee, with the highlights of the discussion summarised below:

• Further details were sought on the scale of the data collection issues identified, given the problems highlighted in the way the council had been recording data and reporting actions as complete without the necessary supporting evidence.  In response, members were advised that this would form part of the work being undertaken through the compliance audit and subsequent compliance recovery programme, with an initial focus on those case identified as most urgent or with the highest risk. Members were assured that the completion of those actions subject to review had not involved any risks assessed as intolerable with a further assessment on all 33 of the Council’s high-rise blocks being undertaken in order to pick up any immediate actions required.  In terms of the Fire Risk Assessments, members were advised that the key focus remained on those actions identified as having been completed but for which there was no supporting evidence and whether this was a case of missing data or work not being completed.

• Whilst recognising that the issues identified had been inherited by the current housing management team, members were concerned at the nature of the compliance issues identified given what was perceived to be a lack of specific overview, tenant engagement or scrutiny of housing as one of the most important functions delivered by the Council (especially given the increasing challenges in relation to supply and demand) and whether the lack of dedicated housing scrutiny was felt to be an issue and supported the need for reestablishment of a Housing Scrutiny Committee.  Whilst recognised as an option, members were advised that the key issue related to the management and operational oversight of the way in which data was being recorded along with the use and training available to staff on the True Compliance System, which would all be assessed as part of the wider root cause analysis being conducted as part of the audit process.  It was also pointed out that the work being undertaken to address the issues identified was already subject to review by both existing Scrutiny Committees with oversight on delivery of the Improvement Plan being led by the Housing Management Improvement Board.

• As further assurance in relation to the approach adopted by the Council, members were advised that the Regulator had recognised the Council's proactive approach with regards to engagement in respect of the engagement with tenants, members and the wider community.  This included the establishment of an engagement team and communications having been issued regarding the self-referral and the subsequent judgement and the media and residents being kept informed as plans were progressed with the next key milestone being the completion of the audit to provide a clear understanding of the full scope of work required.  The Committee acknowledged this was a significant journey, requiring sustained commitment from housing services with it highlighted that many other local authorities were facing similar issues and had received similar regulatory gradings under the new regulation framework, reflecting not only the specific issues highlighted but also, on a sector wide basis, challenges in terms of investment in an ageing stock and levels of rent. Officers confirmed that whilst an industry-wide challenge this context did not diminish the Council's commitment to achieving the highest standards.

• In recognising the extent of the issues identified, further details were sought on the potential resource implications arising in seeking to address and implement the Improvement Plan and any additional compliance measures following completion of the audit.  In response, officers advised that that whilst the audit was ongoing the full extent of any additional resource requirements remained uncertain.  The audit was expected to take 6-8 weeks to complete, and while aware of the current pressures in relation to the Housing Revenue Account (HRA), members were advised that the Regulator would expect a fully costed Action Plan to be provided aimed at achieving compliance within the next 2 -3 years.  Confirmation was provided that the costs being incurred as a result of the process to date would need to be managed within the HRA.  Clarification was also sought on the potential impact in terms of wider grant funding being made available to support social and affordable housing development schemes until compliance was achieved, with members advised that at this stage officers were not aware of any grant funding being impacted although this had been identified as a potential risk corporately.

In terms of funding, the challenges in relation to management of the HRA were acknowledged given the reliance on rental income and the costs involved in delivering the housing service as a landlord.  It was noted any additional funding required would therefore involve a stringent approach focussed on where it would be possible to make savings, achieve better contract management, maximise rental income and payments from leaseholders for works being undertaken, which members were advised had already been identified as actions within the HRA Business Plan,  Given the need identified to ensure compliance it was not felt that decisions could be delayed and it felt that with prudent financial management and a realistic timetable it would be possible to budget for the required action within the existing HRA budget.

Highlighting completion of the audit as the first stage in the process, members were advised that the need to review governance and officer structures, as well as data control and policy frameworks had also been recognised as part of the comprehensive package of improvement activity in relation to housing compliance with a new Strategic Compliance Manager having been recruited as well as an interim Head of Service to support the Compliance Team.

·       Following on, details were sought on the timescale to move from a C3 to C2 grading and ambition to achieve C1. In response, confirmation was provided that it was expected take around 12 to 18 months to satisfy the Regulator of Social Housing that Brent had a firm grip on its management of building safety compliance and that until this was done it would not be able to attain a C2 grading with the commitment to then work towards full compliance.

• As additional issues highlighted during the discussion reference was also made to contract management (given concerns over the current housing repairs service) with concerns also raised on the position regarding data held in relation to the Council’s housing stock and percentage of fire safety actions that had not been carried out, which it was noted may have dated back as far as 3 years.

• Communication, community management and managing reputational risk were also identified as key issues with officers again highlighting the proactive communication strategy implemented which had been approved by stakeholders and commended by the Regulator including direct engagement through area tenancy managers.

With no further comments or questions raised the Chair thanked Thomas Cattermole and Spencer Randolph for the clear update provided along with members for the comments raised in response.  Members advised they would be keen to ensure a further update was provided following completion of the initial audit process and on this basis, it was RESOLVED:

(1)  To note the contents of the report.

(2)  To note the Regulator of Social housing had issued a Regulatory Notice requiring the council to address the breaches in compliance with the required outcomes of the Quality and Safety Standard.

(3)  To note the appointment of specialists to assist with the recovery of the compliance breaches identified along with the activity outlined in developing the accompanying Performance Improvement Plan.

(4)  That a further update be provided by the Director of Housing in September 2025 on the outcome of the initial audit and progress in developing and implementing the associated Performance Improvement Plan.