Recovery planning: the end of Recovery planning: the end of community investment?community investment?

6 October 20156 October 2015

Sally ThomasSally ThomasHead of Community InvestmentHead of Community Investment

North Star Housing GroupNorth Star Housing Group

Community Investment: the way we were

The original purpose of housing associations

Tenant involvement – in the 1970s

Tenant participation - in the 1980s

Housing Plus - in the 1990s

Investors in Communities and People for Action - in the 2000s

In Business for Neighbourhoods - in 2003

Community Investment - from 2011

Community Investment: the way we are

Nearly £750 million is invested every year by housing associations in community and social activities

•Community investment strategies and resources

•Social and economic projects and programmes in communities

•Employment and skills, young people, well-being, financial inclusion

•Community investment grants

•Measuring the impact

•Generating and measuring social value across the business

The July 2015 budget announcements

Rent reduction… minus 1% a year for four years from 2016/17; previous agreement torn up – 14% less income for housing associations 2016-2020

Welfare reform… benefit cap reduction, withdrawal of Housing Benefit for young people (18-21), tax credit reductions, working age benefits frozen; more reforms on the way

Right to Buy… voluntary agreement with Government; associations able to exercise ‘discretion’ on sales in certain circumstances

Pay to stay… higher rents on a joint household income of more than £30K outside London and £40K inside London

The North Star approach to recovery planning

Bottom-up approach to recovery planning – all staff and resident panel involved

Revisions to business plan – impact of reductions in income and changed assumptions

Maintaining the confidence of lenders – ensuring on-going compliance for borrowing

Stress testing – to assess business plan strength and pinch points

Cash flow – re-assessment to ensure association can meet its commitments

The implications for Community Investment

Early indications are that organisations will:

•Retain community investment with reduced resources; but reconfigured and refocused

•Want to see a closer alignment and integration with front-line services

•And activity that improves the economic position of residents to pay their rent, sustain their tenancies and look after their homes

•Want a greater emphasis on external funding

What might Community Investment look like?

• Activity focused on employment, skills, training and education

• More external funding and partnership working

• Getting more social value from procurement

• Developing new business opportunities

• Co-creation with customers

• Delivering social value across the business