Two-thirds of housing association finance departments believe the need for financial expertise will cause an increasing number of mergers over the next 18 months, according to a survey by recruitment consultant Hays Accountancy and Finance.

Sixty-five per cent of the 83 housing association departments surveyed said the demand for specialists would “drive the creation of more partnerships and mergers”.

Joel Armitt, regional director of Hays Accountancy and Finance, said it often made more sense for two smaller associations to recruit one finance expert and share them, rather than hiring two.

“If two small housing associations need financial expertise but each has to pay a salary of £30,000, for example, they may not be able to afford it,” he said. “Rather than both of them taking on someone to do the work, it makes more sense for one of the associations to take them on and the two to work in partnership.”

Armitt added that the growing demand for financial expertise was being driven by the increase in the amount of money being made available to housing associations over the past three years. “If an association is given £300m in funding, for example, it needs to know how it will best invest that money. They have to ask themselves, ‘do we have enough capital management expertise?’”

But one housing finance expert cast doubt on the conclusions.

“I suspect that synergy with other associations, in terms of services provided, and geographic proximity are more important factors,” he said.

Source

Housing Today