1. ALMOs - changing relationships with Councils
Maggie Rafalowicz
7 July 2017

2. Once upon a time… Manifesto for negotiation - not for implementation
The EU referendum was going to be a shoo-in for Remain
Housing policy would focus on –
Increasing supply
Maximising home ownership
Reducing the benefits bill

3. But times change
New leadership, new policies – or at least lots of reviews
Priorities said to be: 1. Brexit, 2. Housing
All Government activity and focus is on Brexit - pressure on Parliamentary time, Civil Service
What happens if we crash out of EU, Single Market, Customs Union with no deal?
£ down 19% since 23/6/16; inflation rising; interest rates likely to rise
Broad-ranging Housing White Paper recognises problems – rents post-2020, Supporting People, planning, delivery, land ownership and control, imbalance of investment, need for institutional investment

4. And indeed times change

6. Demand for new homes
Tenure flexibility returns – Starter Homes not being pursued; rather Build to Rent, affordable rented, shared ownership, market sale
Inner London property values reducing, outer London increasing, Midlands and North growth continuing – but is a crash on the way?
Who does Government want to see developing? whoever can deliver volume at least spending input
But how will homes be built post-Brexit – materials costs rising; 12% of construction workers from EU (25% in London); 10-12k construction workers p.a. retiring and only 2-2.5k a year starting…

7. Where are local authorities in all this?
HRA reform 2012 – LAs responsible for debt based on value of stock
Now face same big cuts in rent income – alongside further spending cuts; e.g. major problems with adult social care
May still be required to sell high value stock and hand cash to Treasury
Homelessness continuing to rise - new homelessness prevention duty for LAs, but no new resources; use of TA increasing
From shared services to devo and full mergers?
Rise of LA Trading Companies, especially to build homes
Joint ventures increasingly popular – with private sector

8. So where’s the demand?
New homes – affordable rented and often market rented
Regeneration partners
Single specialist focus on problem service areas
Service improvement – VFM, digital customer services
Demographics – older persons housing and social care
Costs reduction – e.g. employment T&Cs outside national agreements
Income generation
Partnership working – between LAs, and with other bodies/sectors
Speedier (and more efficient?) decision-making

9. Once upon a time Now there are 35 covering 38 local authorities
More than 70 ALMOs
Established under time limited agreement for decent homes
Some established later:
Welwyn Hatfield; Cornwall; East Kent; Shropshire
To provide quality services and promote tenant participation
Accommodate local government reorganisations
Now there are 35 covering 38 local authorities

10. The case for ALMOs
Focus on delivery
Faster decision making
Tenant participation
Focal point for community leadership
Flexible delivering a range of services
Income generating
Need intelligent clienting, innovation and alignment with Council’s objectives

11. And where’s the ALMO/LATC housing offer?
New development
Estate regeneration
Registered Providers
Market renting – supply and manage
Private lettings agencies
Homelessness and housing needs services
Right to Buy administration

12. And where’s the ALMO/LATC broader offer?
Corporate facilities/property management – for the LA and for others
Repairs and maintenance – for Council stock and for others
Environmental Health enforcement, ASB taskforce
Adult Social Care services, Children’s services
Monitoring services - alarm systems, CCTV, emergency call-handling
Benefits taskforce, welfare advice
Energy schemes, tackling fuel poverty
Aids and adaptations, Disabled Facilities Grant administration
Highways services – street cleansing, etc.
Employment and training initiatives

13. Delivery models
Traditional ALMO – arm’s length; broadly left to get on with it
ALMO under LA’s wing – close joint working; ALMO uses LA back office
Twin-hatting – as model 2 but with Chief Officer (and possibly others) sitting inside the LA structure
Arm’s length delivery agency or group – undertaking range of functions
Single focus LATC – in business to deliver discrete non-housing service
Governance models will vary – e.g. models 1-3 will have Boards combining, LA, resident and independent members; model 5 will be LA and independent members; model 4 may include both

14. Critical messages
There is nothing magical about any one structure, though ALMOs’ inbuilt customer involvement and focus is a key strength
Whatever the precise delivery model, the LA remains the single shareholder – the ALMOs that have survived and thrived longest have been those staying closest to their Councils’ agendas
The greater the diversification, the more that the ‘new’ risks need to be understood and managed
The greater the diversification, the more the need for the Board to have the requisite skills to understand the business streams and to provide appropriate challenge to the Executive and the Council alike
Any organisation that fails to challenge itself, adapt, innovate and reinvent periodically, will eventually be condemned to obsolescence

15. So where does all this leave us?

17. Maggie Rafalowicz maggie@campbelltickell.comor
@CampbellTickel1