A regulator outlook on social housing in Wales

In June 2021, the Welsh Government set out a fresh mandate that puts the environment and climate change at the heart of decision making for the Government and RSLs. The Government has created a new “super-Ministry”, which brings together the environment, energy, housing, planning and transport. Ian made clear that although this is a significant portfolio for the minister and poses huge challenges, it also creates huge opportunities and allows for teams to work together towards the common goal of reaching Net Zero by 2050.

The session highlighted a number of key challenges and opportunities for RSLs in Wales over the next five years, including:

• A challenging target of building 20,000 new low carbon social homes for rent
• Reforming the homelessness service across Wales, with a focus on homelessness prevention through work in all of our communities
• Creating a timber-based industrial strategy for Welsh wood
• A continued and increasing focus on improving building safety, ensuring that people feel safe in their homes
• Decarbonising current homes across Wales through retrofit, delivering quality jobs, training and innovation using local supply chains

With regards to the Government’s aim to build 20,000 new homes for social rent, Ian suggested that there was significant funding available, with over £250m in social housing grants for 2021/22. However, he also acknowledged the challenges of delivering this, with markets and supply chain risks being at the forefront of those challenges. The Government is focused on developing the skills within the sector and offering opportunities for partnerships where possible.

Revised Welsh Regulatory Standards

Following on from the pandemic response, the Welsh Government suspended routine regulatory oversight and focused on maintaining tenant safety, financial viability and business continuity throughout the sector. The pandemic postponed a lot of plans for specific assurance reporting for RSLs, which is now planned to take place from 2022. The new focus of the Regulatory Standards will be materiality and focus on ‘big ticket items’.

The Framework has evolved since it was launched in 2017. The review maintained that the fundamentals of the Standards and system for review was sound. The review has focused on:

• Changes required to the dimensions of the regulatory judgements
• The scope and clarity of performance standards 
• The Regulator’s role in setting expectations around equality, diversity and inclusion 

What has changed?

• New judgement statuses are being proposed, which include grading of compliance against a colour-coded status level. The aim is to give the reader a clear understanding of the Regulator’s message.
• The standards themselves will be revised to focus on outcomes and how Boards meet those outcomes without becoming prescriptive. The standards will also be better aligned with the Regulator’s judgement statuses, to make clear the links between non-compliance with the Standard and the intervention from the Regulator. 
• The Standards will also include specific expectations on equality, diversity and inclusion.
• The new framework introduces ‘Full Regulatory Assurance Reviews (FRAR)’, a more focused review of RSL’s key risks dependant on their business model. Each of the FRARs will be tailored to each RSL and focus on the regulatory intelligence, detailed discussions with the RSL and the sector risk profile. 
• The Regulator is placing responsibility for planning and delivering improvement firmly with RSLs, except where there are material concerns.

Watch the full webinar:

Get in touch

If you would like to discuss any of these topics in further detail, please get in touch.

Contact us today