Detailed application form for registration of new

entrants as providers of social housing

January 2018

Contents

About this form 4

Completing this form........................................................................................................................6Registration criteria..........................................................................................................................6

Format of application form................................................................................................................7

Part 1: Declaration and consent 8

Part 2: General information 9

Part 3: Changes to information provided at the preliminary application stage 11

Part 4: Meeting the Governance and Financial Viability Standard 12

Part 5: Specific expectations applicable to categories of applicant 23

Part 6: Meeting the other standards 26

Part 7: Rents 28

Part 8: Non-profit applicants 32

Section 1: Objects..........................................................................................................................32

Section 2: Subsidiary applicants....................................................................................................32Section 3: Non-charitable applicants..............................................................................................34

Part 9: Equalities 37

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About this form1. This form should be completed by applicants wishing to become providers of social housing

registered under the Housing and Regeneration Act 2008 (the HRA 2008).

2. The form should be read in conjunction with ‘Registration Requirements’, the ‘Guidance for new entrants on applying for registration as a provider of social housing’ (the registration guidance) and the Governance and Financial Viability Standard code of practice issued under section 195 of the HRA 2008 (the Code), all available on the website.

3. The completed form will provide the information that will enable the regulator to assess whether the applicant meets Condition 2 of the eligibility criteria set out in section 112(3) of the HRA 2008: that it satisfies the criteria set by the regulator as to its financial situation, its constitution and other arrangements for its management, i.e. complies with the registration criteria.

4. Guidance on completing the application is included within this form.

5. This form may only be submitted when the regulator has confirmed that the applicant has successfully completed the preliminary application process to establish that it is an English Body which is, or intends to become, a provider of social housing in England. The two stage process is designed to ensure that applicants that do not meet condition one of the eligibility conditions in the HRA 2008 do not waste time putting together a detailed application. However, the applicant is asked to re-confirm the information provided at the preliminary application stage, or set out any changes to it. This is because the regulator must be sure there has been no change since that stage which might affect the continued eligibility of the applicant for registration.

6. This form must be completed in full.

7. This form requires information that the applicant is not likely to have provided previously. If the applicant has answered all the questions but thinks there is additional information that would aid the regulator’s assessment, then that information should be provided.

8. There may be overlaps in the information sought in the individual questions and the applicant may wish to cross refer to information already provided so that the same information does not have to be provided more than once.

9. The regulator expects the following to be enclosed when submitting this form:

a copy of the governing document of other bodies in the group of which the applicant is part

a copy of any registration certificate or confirmation of other bodies in the group of which the applicant is part issued by the relevant body’s registrar/registration body, e.g. certificate of incorporation issued by Companies House.

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10. Applicants should note that, at its discretion, the regulator may not register an applicant with a name that is similar to the name of an existing or previous registered provider if it believes that the use of this name may cause confusion. It may also, at its discretion, not register an applicant with a name that it considers inappropriate or misleading.

11. Throughout this document, references to an applicant’s 'governing body' should, where an applicant does not have a board, be taken to include an equivalent management body as appropriate.

12. Definitions of terms used within this form are, unless otherwise indicated, taken from the HRA 2008 (as amended) or other cited legislation, all of which can be found on www.legislation.gov.uk.

13. The applicant should note that the Homes and Communities Agency (HCA) as a public authority is subject to the provisions of the Freedom of Information Act 2000 and the Environmental Information Regulations 2004. The regulator may also (section 109 of the HRA 2008) share information with a public authority if the regulator thinks the disclosure is necessary for a purposed connected with its functions or the functions or for a purpose connected with the authority’s functions.

14. As a public authority the HCA is also subject to the public sector equality duty, which requires public bodies to have due regard to the need to eliminate discrimination, advance equality of opportunity and foster good relations between different people when carrying out their activities. There is a section on equalities within this application form.

15. This form asks for the consent of the applicant for the regulator to share relevant information with Homes England. It also allows Homes England to share relevant information about the applicant with the regulator. This sharing of information will only take place when it is appropriate to do so. The applicant’s consent may be withdrawn at any stage.

16. Any enquiries should be directed to the Regulatory Referrals and Enquiries team on 0300 124 5225 or email enquiries@rsh.gov.uk

17. The regulator’s preference is for electronic applications. The signed and completed form should be scanned and submitted to the Registry and Notification team: RNTeam@rsh.gov.uk. If it is not possible to submit electronically, the completed form should be posted to:

Referrals and Regulatory Enquiries TeamHomes and Communities Agency1st FloorLateral House8 City WalkLeedsLS11 9AT

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Completing this form

18. The regulator’s primary regulatory principle is co-regulation. Mindful of its duty to minimise interference and its fundamental objective of supporting the provision of social housing, the regulator is clear that board members are responsible for ensuring that they manage provider’s businesses effectively and that their organisations are meeting applicable regulatory standards. The onus is on the applicant to demonstrate its compliance with the registration criteria to the regulator. Further information on the regulator’s approach is set out in ‘Regulating the Standards’, available on its website.

19. If an applicant is registered, the regulator is required by the HRA 2008 to designate it as non-profit or profit-making on its register. Further information is available on this in the registration guidance. If the applicant wishes to be designated on the register as non-profit it should note that the regulatory standards apply to the entirety of the business that it carries out and not just to its provision of social housing. If the applicant wishes to be designated on the register as profit-making, the standards apply only insofar as they relate to the applicant’s provision of social housing. Where non-social housing activity is carried out by a profit-making applicant, the regulator will expect to understand the nature of that activity, the risks it may pose to the social housing assets and how these risks are managed.

20. Applicants that are charities (including charities registered with the Financial Conduct Authority) will find it helpful to refer to the Charity Commission website www.gov.uk/social-housing-regulation-england which contains relevant guidance. The regulator will expect applicants that are charities to demonstrate an understanding of the requirements inherent in their charitable status when it is assessing compliance with the registration criteria.

Registration criteria

21. The registration criteria established by the regulator are linked to the regulatory standards that registered providers have to meet. These standards have been established by the regulator under Sections 193 and 194 of the HRA 2008 and are set out in the regulatory framework which is available on the regulator’s website.

22. The registration criteria are:

All applicants must:• meet the Governance and Financial Viability Standard at the point of registration and

demonstrate it can sustain its financial viability on an on-going basis

• have in place management arrangements that enable it to demonstrate the capacity to meet the other regulatory standards

For applicants seeking non-profit designation:An applicant that is a registered or non-registrable charity must within its constitution:

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• have as an object the provision of social housing (which can be worded as social housing in the form of almshouse accommodation or as charitable social housing)

• if it is a subsidiary, state as much and ensure the parent and its controls are clearly identified

A non-profit applicant which is not a registered or non-registrable charity must within its constitution:

• have as an object the provision of social housing

• embed non-profit status

• if it is a subsidiary, state as much and ensure the parent and its controls are clearly identified.

An applicant which is a Charitable Incorporated Organisation (CIO) must have within its constitution (in addition to the requirements above for applicants that are registered charities) requirements that:

• if it is a subsidiary, state as much and ensure that the parent and its controls are clearly identified

• where it is a subsidiary, changes to provisions identifying the parent and/or its controls, shall be notified to the regulator

• where steps are taken preliminary to winding up or a voluntary arrangement in relation to the CIO, it shall notify the regulator of the fact

• changes to the provisions required by the regulator must be notified to the regulator.

Format of application form

23. This form comprises nine parts. Answering each fully should provide the regulator with the information it needs to assess whether the applicant is meeting the registration criteria. However, the applicant should include any additional information it feels is relevant to the regulator’s assessment if it has not already been provided in response to the questions.

24. The nine parts are:

Part 1: Declaration and consent Part 2: General information Part 3: Changes to information provided at the preliminary application stage Part 4: Meeting the Governance and Financial Viability Standard Part 5: Specific expectations applicable to categories of applicants. (Applicants who

do not fall into any of these categories should mark these questions ‘N/A’) Part 6: Meeting the other standards Part 7: Rents Part 8: Non-profit applicants Part 9: Equalities

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Part 1: Declaration and consentName of applicant: ………………………………………………………………………

On behalf of the above-named applicant, I submit the attached details for consideration by the regulator by way of application for registration of the applicant under section 116 of the HRA 2008 and:

i) certify that there has been no change in the information provided by the applicant at the preliminary application stage OR confirm that the detail of any changes to the information provided by the applicant at the preliminary information stage has been included within this application form [delete as appropriate]

ii) confirm that the applicant has considered the regulator’s registration criteria established under section 112(3) of the HRA 2008 and I believe that it will be able to meet them

iii) confirm that the applicant has considered the rent setting provisions in the Welfare Reform and Work Act 2016 (WRWA) and that the applicant complies with those provisions and, to the limited extent where it still applies, the Rent Standard

iv) undertake to submit to the regulator any necessary documentation and information to demonstrate that the applicant is eligible for registration and can meet the requirements set out in the regulator’s registration criteria

v) certify that to the best of my knowledge and belief, the information given in this form is correct and has been seen and approved by the governing body of the applicant and will ensure that any information subsequently provided to the regulator during the registration process will be seen and approved by its governing body

vi) confirm that I understand that any information regarding this application held by the regulator, including any information provided in this application form and supporting documents, or which is provided to the regulator during the application process, may be disclosed by the regulator where this is in keeping with its obligations as a public authority under the Freedom of Information Act 2000 and/or the Environmental Information Regulations 2004

vii) confirm that the applicant understands that information concerning the applicant provided for registration may be shared with Homes England

viii) confirm the applicant’s agreement to receive electronic communications from the regulator.

Signed by …………………….………………………………………………….…………………

Date …………………………………………………………………………………………..

Name …………………………………………………………………………………………..

Position …………………………………………………………………………………………..

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This application form should be signed by someone who has the authority, in accordance with the applicant's constitution, to sign on behalf of the applicant.

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Part 2: General informationThe applicant is required to complete the contact details section only where its contact details have changed since submission of the Preliminary Application Form. In that case, insert only the details that have changed.

Contact details

Contact name:

Contact’s position/role:

Applicant’s website address:

Registered office address:

Telephone number:

Correspondence address of contact named above (if different to registered office):

Tel. No. of contact named above (if difference to registered office):

Email address of contact named above:

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All applicants must complete the Information about the applicant section below

Information about the applicant

1. How does the applicant consider that it should be designated on the register?Tick only one box

Non-profit

Profit-making

2. If the applicant has a corporate trustee, provide the corporate trustees’ name, registered office address, telephone number and contact details for that trustee

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Part 3: Changes to information provided at the preliminary application stageThis section only needs to be completed when there have been changes to the information the applicant provided at the preliminary application stage. Applicants should set out below the details of any changes and provide amended answers (with accompanying evidence, where relevant) to the relevant questions contained in the Preliminary Application Form.

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Part 4: Meeting the Governance and Financial Viability Standard

Governance and Financial Viability Standard

An applicant must meet the Governance and Financial Viability Standard at the point of registration and demonstrate it can sustain its financial viability on an on-going basis

Guidance:

The applicant must demonstrate how it meets the Governance and Financial Viability Standard at the point of registration and, in relation to financial viability, how it will do so on an on-going basis. The applicant should note that the Code amplifies the requirements in the Governance and Financial Viability Standard. The Code is designed to help registered providers understand what the regulator is looking for when seeking assurance on compliance with the standard by explaining and elaborating on the content, with illustrative examples where necessary. In considering whether standards have been met, the regulator will have regard to the Code so it provides relevant information for applicants.

The regulator expects to see:

a business plan setting out the applicant’s objectives and how it intends to deliver them financial forecasts of income and expenditure, financial position (formerly balance sheet) and

cash flow for at least the next five years a narrative that confirms the rationale for the base assumptions used in the financial

forecasts the applicant’s assessment of the key risks to the delivery of the financial plan and how it

intends to manage those risks stress testing to show the impact of a range of adverse changes in the key assumptions

made in the financial forecasts including the applicant’s greatest risks. This should include multi-variable/combined stress tests, and be undertaken against lenders’ financial covenants, where debt is in place or expected

the applicant’s previous two years’ financial statements and most recent management accounts

detailed evidence as to the actual and assumed levels of rent and rent increases and their relation to the statutory and regulatory requirements on registered providers in relation to rents

detailed evidence as to the impact upon the business plan of all relevant statutory and regulatory requirements on registered providers in relation to rents

detailed evidence as to the accuracy of assumptions made around housing benefit payable in relation to accommodation provided

where financial viability is dependent upon receipt of loan finance, evidence that the funds will be available for drawdown at the time that they are required and on terms consistent with the financial plan and risk assessment

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where grant funding has been offered, evidence of the funding and any conditions or requirements which apply as a result of receiving financial assistance from Homes England or the GLA

a copy of the applicant’s governing document, for example, rules, memorandum of association, articles of association, etc. and that of other bodies in the group of which the applicant is part

a copy of any registration certificate or confirmation issued by the applicant’s registrar/registration body, e.g. certificate of incorporation issued by Companies House, and that of other bodies in the group of which the applicant is part.

The regulator needs to understand the risks to the applicant’s social housing assets. It expects the applicants to show:

it understands what these risks are

the circumstances in which the risks might materialise

how combinations of risks may impact

how risks are mitigated and

how the applicant’s board has assurance on risk management.

The applicant may find it useful to refer to the Sector Risk Profile published on the regulator’s website.

Applicants must explain how their probity arrangements are reflected in the provisions of the applicant’s governing document. For example, provisions dealing with:

conflicts of interest conflicts of loyalty wrongful gifts, bonuses and dividends (refer to section 122 of the HRA 2008) any compromise of charitable status, etc.

They must also explain how their governance arrangements are effectively reflected in the provisions of their governing document.

The governing document must make provision for the removal of any ‘officer’ (within the meaning of section 270 of the HRA 2008) who fulfils one or more of the cases specified in section 266 of the HRA 2008 (see also Guidance Note 17 of the ‘Guidance on the regulator’s approach to intervention, enforcement and use of powers’). Provision must also be made enabling the applicant to take any appropriate action against them (in compliance with the regulator’s expectation under Guidance Note 17).

The applicant should also give details of the code of governance that it has adopted, including the reasons for its choice. It should submit a self-assessment of compliance with the code, explaining where there are any or planned areas of non-compliance.

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The applicant is free to choose a code which reflects the conduct of its business provided it meets the assurances expected by the regulator. Codes most commonly used within the sector include:

Code of Governance: Promoting Board Excellence for Housing Associations (National Housing Federation)

Good Governance: A Code for the Voluntary and Community Sector Corporate Governance and Principles for Unlisted Companies in the UK (IoD and EcoDa) The UK Corporate Governance Code.

If the applicant has relationships with third parties, it should provide details of those third parties and of the arrangements. The applicant should pay particular attention to any arrangements that could be construed by the regulator as advancing the interests of third parties. The regulator will also expect to see the applicant’s governing documents addressing any actual or perceived conflict of interest.

The regulator is particularly concerned about arrangements that may enable value to be extracted from a non-profit provider such as those it may put in place with associated individuals or companies. Where the potential for extraction of value exists, arrangements will be scrutinised closely and the non-profit status of the applicant may be questioned. Such extraction of value may call into question its non-profit nature and this can have an impact on the reputation of the sector, so the regulator will consider the arrangements in this context. If, once registered, the regulator believes that the provider has become profit-making, it can change the provider’s designation on the register.

The regulator recognises that applicants will be at different stages in their development and it will take a proportionate approach within this context to assessing compliance. Where an applicant is an existing business that already provides social housing but has been operating to date without being registered, the regulator will expect to see:

a track record of successful operation a clear understanding of the risks to which the business is exposed and relevant mitigating

strategies an understanding of how becoming a regulated entity might impact on the business; and that relevant policies are in place.

An applicant applying for registration as an intending provider may not always have a track record of operation upon which to base its application, and may not have governance arrangements and financial systems developed to the same level as an applicant which is already a landlord of social housing. However, the regulator expects that, although not a landlord at registration, the applicant will have appropriate governance and financial arrangements in place so that in the absence of a track record, it can demonstrate from its current way of working (including its decision-making in respect of the application for registration) that it will be compliant with the Governance and Financial Viability Standard from the point of registration onwards.

Where an intending provider is an existing business that is beginning to provide social housing for the first time, the regulator will expect the applicant to show that it understands the requirements that are specific to the provision of social housing and demonstrate that it has the skills to manage these.

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Assessing compliance for CIOs and other bodies that result from a restructure of an existing private registered provider but are not captured under s161 or s163 of the HRA 2008

For bodies that result from a restructure of an existing private registered provider, but are not captured under s161 or s163 of the HRA 2008, the regulator will take into account its previous knowledge of the originating private registered provider when determining whether the body has met the registration criteria. It will do this by focussing on the following areas:

establishing whether the successor body’s constitution meets the regulator’s relevant registration criteria;

where applicable, whether the trustees of the originating unincorporated charity have provided assurance to the regulator that the relevant investment body has agreed to the treatment of any social housing grant in the transferring social assets;

whether the originating private registered provider has a satisfactory regulatory track record.

If the regulator has been satisfied that it meets the eligibility condition and has assurance in these areas, the regulator will not require completion of the preliminary and detailed stages of registration, but reserves the right to require the successor body to do so where it is not satisfied in some or all of these areas.

Governance and management of risk

In order to assess compliance with the standard, the regulator needs to understand how the applicant is managed, how it manages risk and how the board has assurance of this.

3. The applicant should provide full details of its board and executive structure and the relative roles and responsibilities of these parties (including profiles of board and executive members).

4. The applicant should provide full details of its shareholding membership (or equivalent), including any chain of ownership up to and including the ultimate owner(s)/parent company.

5. How have the roles, responsibilities and accountabilities for the applicant’s board, chair and chief executive been established (including how they are reflected in the applicant’s governing documents)?

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6. The applicant should explain how its board has reviewed the skills it has available to it and why it considers these are adequate.

7. The applicant should outline what probity arrangements have been established (including how they are reflected in the governing documents) and why its board has considered these are appropriate. The applicant should consider the requirements of section 122 of the HRA 2008 in responding to this.

8. The applicant should explain how it ensures that it does not enter into arrangements that would inappropriately advance the interests of third parties, or which the regulator might reasonably conclude would do so.

9. Does the applicant trade with, or procure services from, an organisation in which shareholders or directors of the applicant have an interest? Does it plan to do so?

10. Does the applicant have any loans from shareholders or directors? Does it plan to do so?

11. Has the applicant leased or bought property from its shareholders or directors? Does it plan to do so?

12. The applicant should outline the basis on which it entered into any of the arrangements disclosed in answer to questions 8 to 10 above and how its board is satisfied that these arrangements are appropriate.

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13. If the applicant has not entered into any such arrangements but plans to do so, it should outline the basis on which it will enter into any of the arrangements above and how its board would be satisfied that these arrangements were appropriate.

14. The applicant should outline how it manages conflicts of interest, particularly in respect of any links to third parties as above, including how this is reflected in its governing document.

15. Which code of governance has been adopted by the applicant and why does its board consider this to be appropriate?

16. How has the applicant’s compliance with its adopted code of governance been assessed? (Please provide a copy of the assessment). Please explain any areas of non-compliance and why the applicant’s board is satisfied non-compliance is appropriate.

Where actions are planned to address any identified non-compliance with the code of governance, the applicant should explain the non-compliance, what action is planned and the timescale for implementation.

17. Describe how the applicant identifies, monitors and manages risk.

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18. Please provide documentation to show the applicant’s identified greatest risks, why they are the greatest risks and its arrangements for the monitoring and mitigation of such risks. This is usually captured by a risk register and risk management policy/procedure.

19. How will the applicant’s board gain assurance that risks are correctly identified, monitored and mitigated?

20. If the applicant plans to contract out services (for example maintenance services) that it will rely on to comply with the standards, it should set out what those services are and how its board has assurance that the third party will not jeopardise its ability to meet these standards.

Financial viability

The applicant must demonstrate its financial viability at the point of registration, and on an on-going basis.

Guidance:

This form also contains questions concerning financial viability and financial governance designed to provide the regulator with information that will enable it to assess the financial viability of the applicant. The applicant’s financial forecasts will be the main document that provides assurance of this.

The regulator expects that its review of the applicant’s business plan will provide it with an understanding of:

the applicant’s strategic objectives and how it plans to meet these objectives the key risks facing the applicant and how it will address them current levels of performance (where relevant) and the financial forecasts

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The financial forecasts, which the applicant should provide, ought to reflect the applicant's strategies, demonstrate sufficient financing for the immediate future, and have been tested against changes to key assumptions. In particular, the regulator will need to be satisfied that the funding on which the applicant is relying on will be forthcoming at the time when it is required and that the applicant can meet the terms on which it is provided. The regulator will not register an applicant until it is satisfied that the relevant funding is in place.

Where financial viability is dependent upon receipt of loan finance, the applicant should provide evidence that the funds will be available for drawdown at the time that they are required and on terms that are consistent with the applicant’s financial plan and risk assessment.

Where grant funding has been offered, the applicant should provide evidence that it will be in a position to meet any conditions or requirements which apply.

If the applicant is developing social housing, it should provide a monthly cashflow forecast as the regulator will need to be satisfied that the applicant is in a position to maintain its viability during a period of heavy demand on its cash.

The applicant should provide details of the basis of any assumptions that support its financial forecasts. The regulator will need to be satisfied that the assumptions that underpin the forecasts are reasonably based.

The regulator will need to understand what risks there are to the applicant’s business plan and how it is addressing these. It is particularly important that the applicant demonstrates that it has considered combinations of risks that might crystallise and how these would impact on its business plan.

An applicant wishing to be designated as profit-making on the register should provide details of the non-social housing activity it undertakes and how the applicant has determined that this is non-social housing activity. The regulator will need to understand how the applicant’s governing body is satisfied with the arrangements in place to ensure that any non-social housing activity remains a small part of the applicant’s business and how any risks arising from that activity are being managed.

21. The applicant should provide its details of its financial forecasts for at least the next 5 years. This should include a Statement of Comprehensive Income (formerly Income and Expenditure), Cash Flow Forecast and Statement of Financial Position Forecast (formerly Balance Sheet Forecast).

In order to complete the financial forecasts, the applicant will have made a number of assumptions relating to the different income and expenditure categories. The regulator needs to understand what these assumptions are and establish how the applicant’s board has assurance that the assumptions are made on a reasonable basis.

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22. The applicant should provide details of the assumptions made in completing the financial forecasts.

23. How has the applicant’s board gained assurance that the assumptions have been made on an appropriate and reasonable basis? Applicants should provide the supporting documentation that has allowed the board to conclude on this.

There will be risks that the assumptions made in the financial forecasts are not delivered to plan for e.g. an expenditure item such as repairs is higher than expected. The regulator needs to gain assurance that the applicant has identified and considered these risks.

24. The applicant should provide the document(s), approved by the board, that identifies the risks that could impact the applicant’s financial forecasts, and the steps it takes (or will take) to monitor and minimise the chances of the risk occurring. Usually this would be captured in a risk register.

25. The applicant should explain how its board monitors and gains assurance that the controls the applicant has identified to minimise the risks occurring are in place and operating as intended. Copies of supporting documents that allowed the applicant’s board to gain assurance that these are operating as intended should be provided.

The standard requires that the applicant carries out detailed and robust stress testing against identified risks and combinations of risks across a range of scenarios and puts appropriate mitigation strategies in place as a result. This builds on the section above, and identifies what can go wrong, what can the applicant cope with financially if things did go wrong, and what would the board do if things did go wrong.

26. The applicant should provide details of the stress testing that it has undertaken on the risks it faces.

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This should include multi-variable/ combined stress tests, and be undertaken against lenders’ financial covenants, where debt is in place or expected. In response to the stress testing what strategies does the applicant have in place to deal with the scenarios identified?

27. What are the risks, or combination of risks, that would need to materialise to make the applicant unviable?

The standard requires that the applicant must have access to sufficient liquidity, i.e. cash, at all times. The regulator will review the applicant’s cash flow forecast submitted as part of the application. The applicant should provide evidence to demonstrate that the key categories of cash income e.g. rents, loan income, grants are firm (i.e. will be available for drawdown at the time that they are required) and in place prior to registration.

28. How has the applicant’s board gained assurance that the applicant will have sufficient liquidity at all times?

29. The applicant should provide the supporting evidence that has allowed its board to gain assurance that the key categories of cash income will be forthcoming.

Registered providers are required to maintain a thorough, accurate and up to date record of their assets and liabilities and particularly those liabilities that may have recourse to social housing assets.

30. The applicant should set out how its board has used and proposes to use the record of assets and liabilities in relation to its management of risk.

31. How has the applicant’s board assured itself that any links to other organisations do not put the social housing assets at undue risk?

32. How has the applicant’s board gained assurance that the list of assets and liabilities is

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up to date and accurate?

Financial governance

Registered providers are required to ensure that they have an appropriate, robust and prudent business planning, risk and control framework that underpins the financial forecasts produced. The regulator would expect this to include appropriate policies and procedures to manage the applicant’s operations, appropriate methods and systems to monitor its financial performance, appropriate controls to ensure that all funds are used as intended, and that the board gains assurance that policies, procedures and controls are operating as intended.

33. The applicant should identify the key policies and procedures that are in place which set out the rules for financial transactions e.g. financial procedures and provide a copy of these in support of the application.

34. The applicant should set out how its board monitors the applicant’s financial performance. In support of this copies of the following should be provided:

the most recent document taken to board reporting the applicant’s financial performance

the document at the last financial year end reporting financial performance against budget.

35. How does the applicant’s board gain assurance that the monitoring systems in place are effective? Applicants should provide the evidence that has allowed its board to conclude that it has satisfactory assurance.

36. How has the applicant’s board gained assurance that the controls the applicant has in place to ensure all funds are spent appropriately are operating as intended?

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Part 5: Specific expectations applicable to categories of applicant

Registered group parents

Registered providers that are parent companies shall, as appropriate, support or assist those of their subsidiaries that are registered providers with a view to ensuring compliance with regulatory requirements.

37. If the applicant has, or intends to have following registration, subsidiaries that are registered providers, it should include details of the group structure and outline the arrangements in place to provide, as appropriate, support or assistance to the subsidiaries with a view to ensuring compliance with regulatory requirements.

Registered providers with unregistered parents

Registered providers with parent companies that are not registered providers shall ensure that they do not enter into agreements to support the activity of the parent or another group member that may have a material negative impact on the social housing assets of the registered provider.

38. Is the applicant a subsidiary of a parent company which is not a registered provider? If yes, the applicant should explain how it fits within the corporate structure.

39. If the applicant has answered yes to question 38, it should outline how its board has assurance that no agreements are in place to support the activity of the parent or another group member that may have a material negative impact on the applicant’s social housing assets.

40. If the applicant has answered yes to question 38, it should outline how its board will have assurance that the applicant will not enter into any agreements to support the activity of the parent or another group member that may have a material negative impact on the social

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housing assets of the applicant.

To enable compliance with the regulator’s standards or other regulatory requirements, registered providers with parent companies that are not registered providers shall have in place effective mechanisms to ensure that:

such parent companies will give any appropriate support or assistance as necessary to the registered provider

such registered providers have the ability to require the support or assistance of the parent company concerned

the registered provider’s ability to meet the regulator’s standards and other regulatory requirements is not and cannot be prejudiced by the activities or influence of the parent company or another part of the group.

41. If the applicant has a parent company which is not a registered provider, it should outline the mechanisms in place to meet the requirements above.

42. How does the applicant’s board have assurance that any mechanisms in place to meet the requirements above are adequate?

Profit-making registered providers only

Profit-making registered providers shall ensure that they undertake their social housing activities in an entity which is legally and operationally separated from any other activities they may undertake, except as set out below.

Profit-making registered providers should ensure that activities they undertake which do not relate to the provision of social housing:

form only a very small part of the activities they undertake

are not such as to mean that registered providers place social housing assets, activities relating to the provision of social housing or their own financial viability at undue risk

43. If the applicant wishes to be designated on the register as a profit-making provider and undertakes activities which do not relate to the provision of social housing, what are

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these activities?

Please detail how the applicant has determined that these are non-social housing activities

The applicant should outline how its board has assurance that the requirements above are met.

44. If the applicant wishes to be designated on the register as a profit-making provider, please detail how its board will have assurance that consideration is given to any new activities and the impact on compliance with the above requirements of the standard assessed.

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Part 6: Meeting the other standards

An applicant must have in place management arrangements that enable it to demonstrate the capacity to meet the other regulatory standards.

The other regulatory standards referred to above are:

The Value for Money Standard The Rent Standard* The Tenant Involvement and Empowerment Standard The Home Standard The Tenancy Standard

The Neighbourhood and Community Standard

* Part 7 of this form contains questions regarding rent.

Guidance:

The applicant must demonstrate how its proposed management arrangements enable it to meet the standards other than the Governance and Financial Viability Standard. The regulator will not assess whether the applicant can meet these standards but will assess whether, in its opinion, the management arrangements that the applicant has in place appear likely to deliver compliance with these standards. The applicant should ensure that the information it provides relates to management arrangements and not to the standards themselves.

An example of the assurance the applicant should provide is in relation to the Home Standard. One of the required outcomes of the Home Standard relates to the quality of accommodation. A specific outcome is that registered providers shall ensure that tenants’ homes meet the standard set out in section 5 of the Government’s Decent Homes Guidance and continue to maintain their homes to at least this standard.

The regulator will expect to see evidence of the arrangements that the applicant has in place that allow its governing body to gain assurance that the applicant is providing accommodation to the required quality, i.e. in compliance with the Decent Homes Guidance, and therefore with the Home Standard. The management arrangements may include, for example:

organisational structures resources policy framework management information framework risk management framework internal control system.

The applicant should note that not all of the standards apply to all types of organisations or all types of social housing. The regulatory framework page on the website sets out the exclusions that apply.

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45. The applicant should outline the management arrangements in place to meet the Value for Money Standard.

46. The applicant should outline the management arrangements in place to meet the Tenant Involvement and Empowerment Standard.

47. The applicant should outline the management arrangements in place to meet the Home Standard.

48. The applicant should outline the management arrangements in place to meet the Tenancy Standard.

49. The applicant should outline the management arrangements in place to meet the Neighbourhood and Community Standard.

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Part 7: Rents

The WRWA 2016 and regulations made under it have introduced rules around the levels of rents that can be charged by registered providers of social housing during the period from 2016/17 to 2020/21. Where these statutory rules apply, they supersede the rules in the Rent Standard. The requirement in the Governance and Financial Viability Standard to adhere to all relevant law includes a requirement to comply with the WRWA 2016, and regulations made under it. Applicants are, therefore, expected to consult the legislation in order to establish how it applies to their stock, taking legal advice where they think it prudent to do so. Applicants are required to demonstrate how the WRWA 2016 and/or, in the limited circumstances where it still applies, the Rent Standard applies to their stock.

Guidance:

In providing evidence about rent levels, applicants should always clearly distinguish core rents from service charges, and explain how each is being treated under the relevant legislative/regulatory regime.

All applicants should answer questions 50 to 58 below which concern the demonstration by the applicant of compliance with the WRWA 2016

If the response to question 50 has not changed from the response to the same question in the Preliminary Application Form, please refer to that response here. If it has changed, please either provide a full response to question 50 below or identify the changes.

50. The applicant should re-confirm the evidence provided at preliminary application stage in relation to the low cost rental accommodation it makes available, or for intending providers, intends to make available, at a rent which is below market rate level. Such information should include:

(a) evidence as to how it has determined the market rate for rents in the areas where it operates or, in the case of intending providers, intends to operate, including evidence of the methodologies, comparators, and definitions used in the determination;

(b) evidence of the rents it charges or, in the case of intending providers, intends to charge for this accommodation, expressed both in absolute terms and as a percentage of the relevant market rate;

(c) evidence of the methodologies used to

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set rent levels for new and existing tenants;

(d) evidence that all the valuations upon which this application relies have been prepared by an appropriately qualified professional in accordance with a Royal Institution of Chartered Surveyors (RICS)-approved methodology and using RICS definitions; and

(e) evidence that the applicant has observed key principles of transparency, accountability, probity, independence, professionalism in procuring such valuations.

51. The applicant should provide the following to supplement the evidence provided at preliminary application stage in relation to the low cost rental accommodation it makes available, or, for intending providers, intends to make available, at a rent which is below market rate:

(a) confirmation that the relevant rents are not and will not be subject to contractual arrangements that will result in those rents ceasing to be below market rate; and

(b) details of the proportion of its total residential property holdings that this accommodation represents, and the basis (e.g. market rent, low cost home ownership shared ownership, etc.) on which it makes any other accommodation available (it may be simplest for the applicant to provide a full breakdown of the tenure of its stock, with full rent and service charge information).

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52. The applicant should confirm which of the properties described above are or, in the case of intending providers, will be let at rents set at social rent levels. By social rent levels we mean rents at a level equivalent to ‘social rent rate’ as defined in the WRWA 2016.

The applicant should provide evidence of the methodologies used or, in the case of intending providers, intended to be used in setting social rent levels for new and existing tenants.

53. In relation to any accommodation which is or, in the case of intending providers, will be, let at rents which are higher than social rent levels but lower than market rates, the applicant should provide detailed evidence as to the basis on which any units will fall within one of the categories of excepted stock set out in the WRWA 2016 and regulations made under it (or the Rents Standard and Rent Standard Guidance, if applicable).

54. The applicant should provide evidence that it has taken into account the impact of the WRWA 2016 and regulations made under it, and in particular the projected impact of the required annual reductions in rent, in preparing its business plans and financial projections.

55. The applicant should provide evidence that any housing benefit payments assumed as part of the applicant’s business plan will in fact be payable at the projected levels, in particular where rents are to be set at levels above social rent levels (as defined in question 52).

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56. The applicant should outline the management arrangements in place to ensure that it complies and will continue to comply with all relevant statutory and regulatory requirements in relation to rent setting.

57. In relation to all of the above questions in this section, the applicant should confirm how its board has gained assurance that the assumptions have been made on an appropriate and reasonable basis, and should ensure that it provides the supporting documentation that allowed its board to these conclusions (i.e. the principles required under question 50).

58. In relation to all low cost rental accommodation (within the meaning of HRA 2008), the applicant should outline the arrangements under which such accommodation will – as required by HRA 2008 – be made available in accordance with rules designed to ensure that it is made available to people whose needs are not adequately served by the commercial housing market.

In the limited circumstances where the Rent Standard still applies to the applicant’s stock, the applicant must complete question 59 below.

59. The applicant should identify the stock to which the Rent Standard still applies and outline the management arrangements in place to meet the Rent Standard in respect of that stock

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Part 8: Non-profit applicantsThis part is to be completed by applicants who have answered “non-profit” at question 1 of Part 2. Section 1 must be completed by all applicants wishing to be designated on the register as non-profit. Applicants should also complete any other sections in this Part 8 that are relevant.

All designation criteria relevant to the type of the body must be met in order for non-profit designation to be considered by the regulator. The regulator’s registration criteria require a non-profit applicant to have as an object in its governing document, the provision of social housing (which charitable applicants can describe as the provision of charitable social housing or as the provision of social housing in the form of almshouses as appropriate).

Section 1: Objects

60. Is there a reference in the applicant’s objects to the provision of social housing?

(Tick relevant box).

YES

NO (Please note: Placing a tick in this box indicates the applicant does not meet the criteria for designation as a non-profit organisation)

Section 2: Subsidiary applicantsOnly complete this section if the applicant is a subsidiary of another organisation.

Guidance:

The term ‘subsidiary’ is defined in section 271 of the HRA 2008:

Section 271 HRA 2008(1) A company is a "subsidiary" of a person if any of the following conditions is satisfied.

(2) Condition 1 is that the person:

(a) is a member of the company; and

(b) has power, independent of any other person, to appoint or remove all or a majority of the board of directors.

(3) Condition 2 is that the person holds more than half in nominal value of the company's equity share capital.

(4) Condition 3 is that the company is a subsidiary, within the meaning of the Companies Act 2006 (c 46) or [Part 7 of the Co-operative and Community Benefit Societies Act 2014] (c 55), of a company which is a subsidiary of the person by virtue of Condition 1 or 2.

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The regulator’s registration criteria for new entrants require a non-profit provider to name the parent body in the governing document. The parent should be identified with its registered name and with its:

Companies House or Financial Conduct Authority (FCA) society registration number; and/or Charity Commission registration number; and/or some other official identifier (such as registered address).

The registration criteria also require that the parental controls are set out in its governing document (i.e. those in line with s271 above).

The regulator expects the following to be enclosed when submitting this form:

a copy of the applicant’s governing document, for example, rules, memorandum of association, articles of association, etc. and that of other bodies in the group of which the applicant is part

copy of any registration certificate or confirmation for the applicant issued by the applicant’s registrar/registration body, e.g. certificate of incorporation issued by Companies House, and that of other bodies in the group of which the applicant is part.

If the applicant is charitable, it should note that the regulator’s expectation is that it is unlikely that a charitable body will be a subsidiary of a non-charitable organisation. However, if this is the case, the applicant should provide details of the assurance the governing body has that its charitable status and objectives cannot be threatened by any action of the parent.

61. Is there a reference in the applicant’s governing document to its subsidiary status, its parent and its parental controls? (Tick relevant boxes that apply)

YES NO

The subsidiary status is stated Yes No

The parent is identified by both name and registered number (with relevant registrar)

Yes No

The parental controls are identified Yes No

62. If the applicant is a charity and its parent is not charitable, how does the board have assurance that its charitable status is maintained and not compromised by the parent?

Answer:

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Section 3: Non-charitable applicants

Only complete this section if the applicant is a non-charitable organisation.

Where an applicant is non-charitable, to be designated as non-profit, it must have all its objects connected with or incidental to the provision of social housing and must embed its non-profit status in its constitution. This is required because it is a condition of s115 of the HRA 2008 for non-profit designation on the register.

63. Is non-profit status embedded? (Tick relevant box)

YES

NO (Please note: placing a tick in this box indicates the applicant is a profit-making organisation)

64. Explain how the applicant has embedded its non-profit status.

Explanation:

65. Confirm that all the applicant’s other objects are connected with or incidental to the provision of housing (please tick relevant box).

YES

NO (Please note: placing a tick in this box indicates the applicant is a profit-making organisation)

Section 4 - Charitable incorporated organisations (CIOs)

Only complete this section if the applicant is a CIO established under Part 11 Charities Act 2011

Guidance:

A CIO is a body established under Part 11 Charities Act 2011 which meets the requirements of sections 205 and 206 of the Charities Act 2011 but the CIO’s principal office must be in England:

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CIO – Part 11 Charities Act 2011

205 NatureE+W

(1) A CIO is a body corporate.

(2) A CIO must have:

(a) a constitution;

(b) a principal office, which must be in England or in Wales;

(c) one or more members.

(3) The members may be:

(a) not liable to contribute to the assets of the CIO if it is wound up; or

(b) liable to do so up to a maximum amount each.

206 ConstitutionE+W

(1) A CIO's constitution must state:

(a) its name;

(b) its purposes;

(c) whether its principal office is in England or in Wales; and

(d) whether or not its members are liable to contribute to its assets if it is wound up, and (if they are) up to what amount.

(2) A CIO's constitution must make provision:

(a) about who is eligible for membership, and how a person becomes a member;

(b) about the appointment of one or more persons who are to be charity trustees of the CIO, and about any conditions of eligibility for appointment; and

(c) containing directions about the application of property of the CIO on its dissolution.

(3) A CIO's constitution must also provide for such other matters, and comply with such requirements, as are specified in CIO regulations.

(4) A CIO's constitution:

(a) must be in English if its principal office is in England;

(b) may be in English or in Welsh if its principal office is in Wales.

(5) A CIO's constitution must be in the form specified in regulations made by the Commission, or as near to that form as the circumstances admit.

(6) Subject to anything in a CIO's constitution:

(a) a charity trustee of the CIO may, but need not, be a member of it;

(b) a member of the CIO may, but need not, be one of its charity trustees; and

(c) those who are members of the CIO and those who are its charity trustees may, but need not, be identical.

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The regulator’s registration criteria require that an applicant that is a CIO must have, within its governing document, a requirement that changes enabling the applicant to become or cease to be a subsidiary of another body may only be made if it has notified the regulator.

The regulator requires provisions in the CIO’s governing document that ensure the CIO must notify the regulator if steps are taken preliminary to the winding up or to a voluntary arrangement in relation to the CIO.

The regulator’s registration criteria require that an applicant that is a CIO must have within its governing document a requirement that changes to the provisions required by the regulator may only be made if the regulator has been notified of the change.

66. Where it is a subsidiary, does the applicant’s governing document state that any changes to provisions identifying its parent and/or its controls are to be notified to the regulator? (Tick relevant box)

YES NO

67. Does the applicant’s governing document state that if preliminary steps are taken preliminary to the winding up of the applicant or prior to the applicant entering a voluntary arrangement with its creditors, it must notify the regulator of the fact? (Tick relevant box)

YES NO

68. Does the applicant’s governing document state that any changes to the provisions required by the regulator must be notified to the regulator? (Tick relevant box)

YES NO

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Part 9: Equalities

Public sector equality duty

As a public authority, the regulator has a specific duty to have due regard to equality issues, when exercising its regulatory functions (including the processing of this application form). These obligations are set out in section 149(1) of the Equality Act 2010. This is called our public sector equality duty. The questions below are asked in this context and the responses will impact on the regulator’s registration decision.

Guidance:

Applicants must provide assurance of their compliance with the Equality Act. Although the regulator appreciates that not all restrictions are unlawful, the current equality legislation specifically requires that any restriction of services, based on a protected characteristic, must be justified on the basis set out in the Equality Act 2010.

The protected characteristics for the purposes of the regulator’s public sector equality duty are:

Disability Age Race Gender reassignment

Religion or belief Gender Sexual orientation Pregnancy and maternity

The service that the regulator regulates is the provision of social housing by registered providers.

As a result, the regulator asks for confirmation whether the applicant has any, or intends to have any restrictions in place regarding persons sharing a relevant protected characteristic. Where the regulator establishes that such restrictions are in place, or will be put in place, it will ask the applicant for specific assurance how it has satisfied itself that it is acting lawfully under the current equalities legislation. This is relevant to the regulator’s public sector equality duty and the regulatory requirement for registered providers to comply with all relevant law.

Requirement for a declaration

69. Does the applicant require, or intend to require, any declaration to be made in order for persons to:

become members of its organisation obtain access to its services or charitable benefits

This does not include declarations that are employment requirements. (Tick the relevant box)

YES Go to next question 70

NO Go to question 73

70. Who does this declaration apply to? (Please tick all that apply)

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Members Go to next question

Persons using services or accessing benefits

Go to next question

71. Is the requirement for this declaration set out in the applicant’s governing document?(Tick the relevant box)

YES Go to question 73

NO Go to next question 72

72. If no, please summarise the nature of the declaration below:

Answer:

Restriction on access to services or provision of charitable benefits

73. Does the applicant restrict, or intend to restrict access to services or the provision of charitable benefits to the public to particular groups of people? (Tick the relevant box)

YES Go to next question

NO Go to question 78

74. Please provide details of the types of services or charitable benefits provided to the public.

75. Please indicate those categories which fall within the scope of the restriction which the applicant imposes on access to services or the provision of charitable benefits to the public. (Tick all that apply)

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Disability Religion or belief

Age Race

Pregnancy and maternity

Sexual orientation

Gender Gender reassignment

76. Is this restriction of access to services or the provision of charitable benefits set out in the applicant’s governing document? (Tick the relevant box)

YES Please go to question 78

NO Go to next question

77. If no, please summarise the restriction of access to services or the provision of charitable benefits below

Answer:

Restrictions on membership of provider organisation

Only answer questions 78 to 81 if the applicant has a membership structure.

For example: a charity with a membership structure, such as YMCA

78. Does the applicant restrict, or intend to restrict, membership of its organisation to any particular groups of people? (Tick the relevant box)

YES Go to next question

NO You have finished completing this form

79. Does the membership restriction relate to any of the groups listed below? (Tick all that apply)

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Disability Age Race Gender reassignment

Religion or belief Gender Sexual orientation Pregnancy & maternity

YES Please see below and tick all that apply, then go to next question

Disability Religion or belief

Age Race

Pregnancy and maternity

Sexual orientation

Gender Gender reassignment

NO You have finished completing this form

80. Is this membership restriction set out in the applicant’s governing document? (Tick the relevant box)

YES You have finished completing this form

NO Go to last question

81. Please summarise the nature of the membership restriction below.

Answer:

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© HCA copyright 2018

This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3

Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned.

This publication is available at [https://www.gov.uk/government/publications or other web address]

Any enquiries regarding this publication should be sent to us via enquiries@rsh.gov.uk or call 0300 124 5225.

or write to:

Regulator of Social HousingFry BuildingMarsham StreetLondon SW1P 4DF

Regulation of social housing is the responsibility of the Regulation Committee, a statutory committee of the Homes and Communities Agency (HCA). The organisation refers to itself as the Regulator of Social Housing in undertaking the functions of the Regulation Committee.

References in any enactment or instrument to the Regulator of Social Housing are references to the HCA acting through the Regulation Committee. Homes England is the trading name of the HCA’s non-regulation functions.

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