Public & Private

Last week's announcement by deputy prime minister John Prescott that there will be a single inspectorate for housing comes at a time when housing providers are required to be ever more accountable.

For instance, local authorities and housing associations are required to measure and publish their management performance. This means that clear performance league tables can be published. But does it help to drive service improvements in the sector? I am not sure.

Doubtless some organisations will take pride in their continual year-on-year improvement. But for others, the regulators will need to take a more active role.

What might be the shape of things to come? Well, have a look at the education sector. To start with, performance standards were devised, then school league tables were drawn up. For failing schools or education authorities, the ultimate sanction is intervention: external management is imposed in the hope of improving performance to a sustainable level.

The regulators in the housing management sector (that is, the Office of the Deputy Prime Minister or the Housing Corporation) can also intervene – either directly or indirectly – but this power is seldom, if ever, used.

Does quality cost?
The success story of companies like management contractor Pinnacle in taking over housing management services and delivering significant service improvements with similar budgets to the landlords provides some important pointers.

The informal evidence is that management specialists are able to perform to higher standards than the teams they replace

Chief operating officer John Swinney, summarises the advantage they bring in the areas Pinnacle manages: "We have a focus which the traditional landlord might not have – our job is to provide high-quality housing services. Second, we do not have the bureaucracy that councils and housing associations might be subject to. This makes responding to requirements and decision-making much easier. Finally, care, recognition, respect and rewards for our management team provide real incentives for them to provide the best quality of service."

The informal evidence is that housing management specialists, such as Pinnacle, can perform to higher standards with the same financial resources as the teams that previously carried out the function. It's all a case of focusing on the core business activities.

When to intervene?
The performance graphs below are based on registered social landlord data from the Housing Corporation. Most of the associations are close to their set performance targets. But there are stragglers. If we imposed a cut-off point below which housing managers would be put under inspection and then intervention imposed, performance would rapidly improve. The statistics also seem to indicate it is better up north, while southerners perform less well.

Is continual improvement possible?
Time will tell whether RSLs and local authorities can deliver year-on-year service improvement. The sector might benefit from the shake-up proposed by Prescott as it would reward the high achievers and force the laggards to focus on their core business or contract out services to organisations that are better able to deliver quality services.