The deputy prime minister has demanded the regulator take action over a string of large pay-offs and salary hikes to housing association chief executives.
John Prescott wrote to the Housing Corporation this week to tell it to look into the issue.

The move follows a string of large pay-offs including a £233,000 "golden goodbye" for Downland Housing Group chief executive Bob Herbert (HT 26 September 2003, page 11).

Speaking in the Commons on 7 January junior housing minister Yvette Cooper said: "We are concerned that associations should not be promoting excessive and unjustifiable pay and severance packages."

Last year's Housing Today pay survey found that chief executives at the 20 largest registered social landlords rose, on average, at twice the rate of inflation (HT 28 March 2003, page 26).

Large payouts included £65,000 relocation money for Sanctuary boss David Bennett, taking his total package to £230,068 in 2002-03.

Corporation chair Peter Dixon has replied to the letter and pledged to produce "robust guidance". He pointed out such payoffs were "difficult to defend".

However, he reiterated the corporation's existing position that it is unable to involve itself in associations' "operational activities", as they are independent bodies.

Jim Coulter, chief executive of the National Housing Federation, said: "I would like to know why it is that John Prescott has chosen to single out associations, when it is clear that it is not just them that have seen pay hikes."

However, Coulter admitted that there were some cases where payments appeared excessive.

"Some individual payments have to be looked at," he said.

Lady Grace Montgomery, chair of Harvest Housing Group, said: "We wouldn't want to see a pay scale for chief executives because RSLs would overpay in some cases and underpay in others.

"[They] are independent organisations. If a board is doing its job properly, it should be left to make its own decisions."

An ODPM spokeswoman declined to comment.

Source

Housing Today