Believe in me

Understandably, he'd prefer to be judged on his actions rather than the way he presents himself to journalists. And none of his actions to date is more revealing than his decision to accept his new job for a lower salary than was offered: instead of the mooted £150,000 a year, Rouse will get £125,000. He tries to downplay it, offering the not entirely convincing argument that such things happen more often than people know. But the pay cut was essential, he says.

"One of the things I'm going to focus on in the next six to nine months is chief executive pay and severance. I felt it wasn't credible to take a strong lead if I wasn't willing to take the same approach myself. And I wanted to show a degree of solidarity with the staff, some of whom are on low pay in terms of the lower grades."

Having affirmed his personal credibility, Rouse now plans to do the same with the much-maligned corporation, renewing confidence in the quango among its staff, the government and the housing sector at large.

The quango surrendered its inspection function to the Audit Commission in April 2003 and this, plus a recently completed "end-to-end" review by the ODPM, has fuelled speculation about its future. To make matters worse, in January the ODPM select committee opted to carry out its own investigation of the organisation.

Fortunately, though, Rouse's appointment in February was hailed as a master stroke by many housing professionals. Although only 36, he is considered one of the brightest public servants of his generation and is deemed to have the dynamism to change the corporation's image. Who better to revitalise the corporation than Rouse, a self-confessed "do-gooder" with a "deep affinity with the values of the housing sector" and an enviable track record as the first chief executive of one of the deputy prime minister's favourite quangos, the Commission for Architecture and the Built Environment.

The corporation's position has improved in the four months since Rouse's appointment; it is, he says, not "quite so under the cosh" as it was last year. The indications are that the government review will not be overly critical and stakeholders including registered social landlords, the Chartered Institute of Housing and the Audit Commission have made supportive submissions to the ODPM select committee. Nonetheless, the challenge facing Rouse is formidable.

Something to shout about
In preparation, over the past two months he has visited the corporation's regional offices and RSLs around the country. Rouse says the message he brought back is that people want him to "lead" – the implication being that staff and, to a lesser extent, RSLs believe leadership has been lacking in recent years. Rouse won't comment on his predecessors – "I'm not one for autopsies" – but, whereas the previous chief executive, Norman Perry, said he regretted that the corporation had done little which he wanted to crow about, Rouse promises a different legacy.

He says the Treasury needs to be convinced the quango can do a good job as "the government's agent in procuring affordable homes". "The corporation needs to strengthen its communications with the Treasury and that is something I'm intent on doing – in partnership with the ODPM but with a distinctive voice as well," he says, adding that the Treasury's relationship with the corporation is "critically important".

"We've got to be much more confident in the way we deal with partner organisations. We want be an equal partner and to have a lot more self-belief."

Self-belief is not something Rouse appears to lack. He doesn't mark himself out, as many senior managers do, by wearing a sharp suit and tie, the kind of uniform that's designed to impress and denote importance.

And, unusually, his ambitions do not extend much higher than the position he already has. It's easy to believe the seemingly apocryphal story that his dream job is council chief executive in Bradford, where he was born (such a move would, ironically, involve a pay rise: last year advertisements offered prospective chief executives £200,000 – a salary Rouse condemns as "unbelievable").

Rouse admits he will also have to tackle weakness within the corporation, notably the low staff morale that led to two threats of strike action within the past 18 months, one of which was carried through in March. As part of this, he will personally attend the quarterly negotiating meetings with unions Amicus and Unison.

Rouse got his first insight into the staff disquiet at a meeting in May. "I expected the unions to give me a hard time – that's what they are there for – and they did," he says. "All you can do is be honest with people, tell them when it's no and tell them when it's yes.

I’m going to focus on chief executives’ pay and I felt it wasn’t credible if I wasn’t willing to take a pay cut myself

Staff issues
"But I don't know if attending the meetings is going to be enough to keep staff happy. The pay remit is incredibly tight; the Treasury is putting us under huge pressure; we're facing pressure on Gershon [the review of public sector efficiency], pressure on Lyons [the review that recommended moving civil servants out of London]. There are going to be lots of industrial relations issues and I'm not pretending it's going to be easy."

One issue Rouse is determined to resolve is the corporation's dated IT system – one factor he blames for low morale. An outsourcing firm was given a multimillion-pound contract to provide desktop management, email and e-business systems in February 2003, but the project is now long overdue. Although this problem, which has taken up a quarter of his time at the quango so far, is "inherited" – the closest he will come at any point in our conversation to suggesting fault on the part of the previous management – Rouse says the contract will not be re-tendered.

He has a wide vision for redeeming the corporation – which, given its level of detail, sounds as if it's been in formulation since before he took the job – and it goes to the heart of the quango's day-to-day work.

He'd like to bring its regulation and investment functions closer together. "One of the strongest regulatory tools we have for organisations that are ambitious for development is investment. The fact that we can close off or open up that tap is probably one of the most powerful tools in our armoury, and I don't think we're making the most of that in terms of linking them."

He wants a system where the corporation's regulatory powers support its role as investor in social housing, and he believes the quango's work in looking at RSL's financial viability is being wasted. Instead of simply being part of the regulation regime, this financial analysis could be used to identify which associations have greater capacity for development, he believes.

"We have this fantastic financial appraisal function but at the moment it is embedded in the regulation function looking at viability. I want them to be increasingly looking at capacity, in terms of taking on additional investment risk and so on, and closing the gap between regulatory and investment function in that way as well."

Such a change could see the housing associations with the healthiest balance sheets encouraged to build more homes. These would complement the homes the corporation hopes to get built by funding private developers. Rouse, who has no "moral qualms" about such a scheme, is working up its details for inclusion in the Housing Bill, which is expected to gain royal assent by the end of the year.

His concession to concerned associations – perhaps a legacy from his previous job at CABE – is that "developers won't get any money if they can't design as well as RSLs".

More power
Rouse has his own "private concerns", which seems to be his low-key way of saying he has serious questions about the corporation's regulatory powers. At present, it can make appointments to the board of a struggling association or initiate a statutory inquiry. He would like the corporation to be able to temporarily take over the management of failing associations, and supported calls for such powers to be in the Housing Bill. These have failed for the time being, but he says he will continue to press for the extra powers.

Rouse is also set on investigating the economies of scale that associations can achieve through stock rationalisation and merger. He knows the issue is controversial but believes the corporation must be more proactive. "We will have to find new mechanisms for encouraging [rationalisation] … I don't think we can be laissez-faire about it. There is the possibility of offering incentives for stock swaps where that would be useful."

Rouse's final priority is to get the national benchmarking scheme – which could become a league table for associations – up and running (HT 28 May, page 11). Consultant Indepen is compiling the performance indicators that will underpin the scheme and they are expected to be ready by the autumn.

"We're looking at overall organisational performance to start with and then we'll look to see how we can break it down," says Rouse. "But I'm reluctant to do down an RSL by putting into the public domain data that's not as robust as it should be. What I'm hoping is that the efficiency index will be seen as valid by RSLs themselves."