Why we are engaging with Homes for Life Housing Partnership (Homes for Life)
We are engaging with Homes for Life about its governance and financial management.
In October 2020 Homes for Life commissioned an independent investigation which identified weaknesses in aspects of its approach to asset management and performance management. Homes for Life appointed an interim manager, agreed an action plan and has made progress towards addressing most of the findings and recommendations.
We asked Homes for Life to provide its assessment of its compliance against the Regulatory Standards of Governance and Financial Management and regulatory requirements. Homes for Life identified several areas where improvements were required including business planning, its asset management strategy, its governance framework and succession planning. Homes for Life has made most of the improvements required.
We will continue to engage with Homes for Life to seek assurance that it completes and embeds its improvements, and following a strategic options appraisal that it recruits a permanent senior officer. Homes for Life is working openly and constructively with us.
Homes For Life has a significant programme of investment in its existing stock. It has recently completed a stock condition survey and we will engage with Homes for Life to get assurance about how it is managing the risks to the organisation from its ongoing investment plans.
What Homes for Life must do
Homes for Life must:
- provide us with monthly progress updates on implementing the remaining elements of its improvement action plans;
- provide us with regular progress updates on recruiting a permanent senior officer; and
- send us by 30 June 2022:
- its approved business plan and updated risk register;
- 30 year financial projections consisting of statement of comprehensive income, statement of financial position and statement of cash flow complete with assumptions and explanatory narrative;
- financial sensitivity analysis which considers the key risks, the mitigation strategies for these risks and a comparison of the resulting covenant calculations with the actual current covenant requirements;
- the report to the Board in respect of the approved 30 year projections, sensitivity analysis and covenant compliance; and
- evidence of how it demonstrates affordability for its tenants.
What we will do
We will:
- review Homes for Life’s progress updates on implementing the final elements of its improvement action plan, and recruiting a permanent senior officer;
- review the business plan and financial projections;
- meet with Homes for Life’s senior staff to discuss the business plan, the financial information and any risks to the organisation; and
- update our published engagement plan in light of any material change to our planned engagement with Homes for Life.
Regulatory returns
Homes for Life must provide us with the following annual regulatory returns and alert us to notifiable events as appropriate:
- Annual Assurance Statement;
- audited financial statements and external auditor’s management letter;
- loan portfolio return;
- five year financial projections; and
- Annual Return on the Charter.
It should also notify us of any material changes to its Annual Assurance Statement, and any tenant and resident safety matter which has been reported to or is being investigated by the Health and Safety Executive or reports from regulatory or statutory authorities or insurance providers, relating to safety concerns.