Is big beautiful?
Apr 08 2016
Our news this week that East Thames, Hyde and L&Q plan to merge has created quite a stir. Most of it positive – the 100,000 new homes over ten years, the £250m investment into our Community Foundations, and truly innovative plans for our own Academy for residents and staff, have all inspired.
Some had concerns – what about social rent, residents or our social mission?
As CEO of L&Q, as CEO designate of our planned merger, and as a proud Londoner and someone who grew up in social housing, these are all things I care deeply about too.
So - what about the rents? We plan to provide 100,000 new homes over ten years. Half of these will be genuinely affordable – 25,000 for affordable home ownership and 25,000 for below market rent.
Will they be social rent? Affordable rent? I challenge you to define either. Our rents will be set as a percentage of net income, a level which people on lower incomes can afford. In some areas this will be as little as 40% – well below the 80% we are able to charge. And wherever you find our affordable homes, you’ll find genuinely affordable rents for those that the market has failed.
Could we do more? In a world without government grant we need to finance affordable housing through the profits we make on housing for sale and market rent, but we’ll use this finance to maximise the amount of affordable housing we provide.
What about our residents? Our residents are at the heart of our plans. Providing high quality homes and services to our residents is our core function. It’s our licence to operate and our social purpose. When we entered into early discussions with Hyde and East Thames, it was our shared vision for our communities and resident services that got us excited.
Through the merger, we’re going to combine the best of what we already do – keeping the bits that our residents like. And we’ll be trying out new ideas – being innovative with IT and customer services, and making the business truly fit for the future.
All three organisations are committed to involving our residents. In the Summer we’ll be holding a big three way event to involve as many residents as we can in the shaping of our service. We will always remain accountable to the people we house.
Will these efficiencies really be delivered? They will. We've done it before. We will do it again.
And finally – can big be beautiful? It can be, but it can be pretty ugly as well. As Sarah Webb late CEO of the CIH once said to me, it's not about big versus small, or national versus local or specialist versus generalist. It's about those who get it and those who don't. I think we get it – L&Q, Hyde and East Thames. It's about providing an efficient, responsive service. It's about building as many homes as we can. And it's about staying true to our social purpose.
I believe that in the housing association sector diversity is our strength. But consolidation is inevitable. For this reason we have put five stakes in the ground – five things which for us will not change.
Our commitment to creating a great place to work.
Our commitment to the quality of our homes and service.
Our ambition to build as many homes as we can with as many as possible being affordable to people on lower incomes.
Our commitment to remaining amongst the most efficient in the sector
And, for me, most importantly, our social purpose. We are and will always be a charitable housing association.