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NHF to remove membership from exempt accommodation providers if they don’t meet new standards
The sector body that represents England’s housing associations has threatened to remove the membership of any exempt accommodation provider that does not meet new requirements being written into the organisation’s new membership policy.
The National Housing Federation (NHF), which represents 800 housing association across England, has confirmed that it has now changed its membership policy for new members so it can block any applications for membership from providers looking to enter the sector for the wrong reasons.
It is also proposing to change its articles for existing members, with members being threatened with having their membership suspended or removed if they do not conform with its new ethos.
The new membership standards will be introduced in September and will state that no association should be allowed to join the NHF ranks to operate with a view of generating gain or income for any person exercising control or influence over the association other than their salary or bonus.
It adds: “The NHF takes the view that such an organisation may not be operating in practice as a non-profit entity, even if its rules or constitution suggest otherwise.
“Therefore, the NHF board may exclude such an organisation from membership.”
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The new guidance comes in response to the escalation of exempt accommodation in England, particularly in the city of Birmingham. The city has seen the number of exempt accommodation bedspaces grow from just over 4,000 in 2014 to 22,000 this year.
Exempt accommodation is often used to house people who have very few options, such as prison leavers, rough sleepers, refugees and migrants, and those experiencing substance abuse issues.
Since such landlords provide loosely defined care and support services, their tenants can be exempt from housing benefit caps and associations can charge much higher rents than regular landlords.
In many cases, registered providers employ managing agents to provide accommodation and support services by entering into short-term lease arrangements with these companies.
The NHF has said that there have been reports of some exempt accommodation being unsafe, with residents not receiving the support they were promised. It also said that the lease-based model exempt accommodation providers adopt also allows them to grow rapidly without the proper governance structures in place.
The NHF also stated that in some cases there are links between for-profit landlords and those running the ostensibly not-for-profit housing.
To combat this, the NHF is now proposing to change the articles of existing members in September, while asking for additional assurances from “a small number of existing members based on these new standards”.
The move by the NHF follows a seemingly tougher stance by the sector against housing associations providing exempt accommodation.
The Regulator of Social Housing announced in 2019 that it had blocked exempt accommodation providers from registering as housing associations, while it has also investigated a number of exempt accommodation providers, in many cases finding them non-compliant with its Governance and Financial Viability Standard.
Writing in Inside Housing today, Baroness Diana Warwick, chair of the NHF, said: “I am immensely proud of the amazing supported housing providers we represent, which deliver excellent services against an incredibly challenging environment.
“But they must not be confused with the actions of landlords entering the supported housing market for the wrong reasons: primarily to make a profit instead of helping individuals and their local communities.
“As the sector’s trade body, we can set expectations, make it clear we don’t think the kind of practices set out above are acceptable and clarify what we mean by not-for-profit, but as the trade body we can’t solve this problem.”
She also urged the regulator to continue to take action against those associations that breach standards and called on the government to quickly implement its Social Housing White Paper and strengthen the regulator’s powers to tighten the definition of ‘not-for-profit’.
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