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RSH downgrades RBH to G3 and issues regulatory notice

The English regulator has downgraded Rochdale Boroughwide Housing (RBH) to a non-compliant governance rating after finding that the housing association had breached the Home Standard.

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The Regulator of Social Housing has issued a regulatory judgement and a regulatory notice on Rochdale Boroughwide Housing (picture: Getty)
The Regulator of Social Housing has issued a regulatory judgement and a regulatory notice on Rochdale Boroughwide Housing (picture: Getty)
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The English regulator has downgraded Rochdale Boroughwide Housing to a non-compliant G3 governance rating #UKhousing #SocialHousingFinance

In its regulatory judgement on Thursday (15 December), the Regulator of Social Housing (RSH) said that the downgrade to G3 is because of the failure of RBH’s board to act with an “appropriate degree of skill, diligence, effectiveness, prudence and foresight in response to the most serious of consequences”.

 

The regulator has also published a regulatory notice stating that RBH has breached the Home Standard and parts of the Tenant Involvement and Empowerment Standard, which led to actual and potential serious detriment to RBH’s tenants.

 

RBH made a self-referral to the regulator in January 2021 following the death in December 2020 of Awaab Ishak, a two-year-old boy who lived with his parents on RBH’s Freehold Estate in Rochdale.

 

RBH reported that the coroner was investigating the condition of Awaab’s home, including whether this was linked to his death. The RSH reviewed the information available at that time and decided that it would revisit the case once the inquest had concluded in order to review any new evidence.

 

In November, the coroner concluded that the toddler died as a result of prolonged exposure to mould in his RBH-owned flat.

 

The RSH said that the death and subsequent events led to “apparent action by RBH”.

 

But it said the housing association missed opportunities over a two-year period to act in a “timely, effective and proactive manner to strengthen its risk controls and assurance relating to damp and mould hazard as more information came to light”.

 

The RSH concluded that it lacks assurance that RBH’s governance arrangements ensure that the provider is accountable to tenants, the regulator and relevant stakeholders, and that they safeguard the reputation of the sector.

 

It said this was because of the housing association’s failure to take sufficiently swift and robust action to address material risks relating to damp and mould conditions in its properties.

 

The regulator found that RBH breached the Home Standard. It concluded that RBH’s repairs and maintenance service did not respond to the needs of Awaab and his family, as well as a “significant number” of other tenants on the Freehold Estate that the family lived on.

 

The regulator said RBH’s board failed to take appropriate steps to ensure the integrity of its data relating to the condition of its properties, which adversely impacted its decision-making and scrutiny of the risks.

 

RBH did not survey the Freehold Estate until August 2022. This survey found that almost 80 per cent of properties inspected had damp and mould issues of varying severity.

 

The regulator said the results and timing of the survey “severely undermines” the credibility of the assurance upon which RBH’s board had relied.

 

The RSH said that it is not clear why RBH was unaware of these problems given that they are widespread across the properties on the Freehold Estate.

 

The regulator said that the outcomes in this case show that RBH has failed to hear from tenants about the conditions of their homes.

 

It added that the housing association has failed to communicate in a way that is appropriate to the diverse needs of tenants in line with the Tenant Involvement and Empowerment Standard.

 

RBH has now acknowledged that it made assumptions about the family’s lifestyle, the regulator added.

 

RSH said this affected its decisions about how damp and mould at the property were dealt with and, as a consequence, it failed to comply with the Tenant Involvement and Empowerment Standard which requires providers to treat tenants with fairness and respect.

 

The regulator said that at this time, it “lacks assurance that the attitudes towards, and assumptions about, Awaab’s family are not a wider issue” with the potential to affect other RBH tenants.

 

Furthermore, the RSH said that other families on the Freehold Estate have also experienced harm as a result of the quality of the accommodation provided by RBH, so it does not have assurance that other tenants have not been similarly put at risk as a result of these failings.


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Since the coroner’s report, RBH has apologised on more than one occasion and said that it has, and will continue to, learn lessons.

 

The board of the housing association removed chief executive Gareth Swarbrick after he resisted calls to step down and appointed Yvonne Arrowsmith as its interim chief executive to lead the reforms.

 

The RSH said that under the leadership of Ms Arrowsmith, RBH is “increasing the pace and urgency” of its response to put a recovery action plan in place.

 

It said RBH’s plan will include a review of its board skills, governance and risk management arrangements to address the issues set out above.

 

The regulator said RBH is putting in place a programme to rectify its failures and has “assured the regulator that it is taking prompt action to remedy the breach of standards and that risks to tenants are being mitigated until this work is complete”.

 

A spokesperson for RBH apologised again and accepted the regulator’s judgement.

 

They said that the housing association has begun the journey with a “long road ahead” to regain the trust and confidence of current and future tenants, Rochdale Council, the Rochdale community, and the regulator.

 

The spokesperson said that interim head Ms Arrowsmith has a proven track record of transforming housing providers, and has made it a “priority” to listen and respond to tenant feedback.

 

They said that RBH’s new damp and mould taskforce has “significantly accelerated” remedial work, new translation tools are helping it to better communicate with tenants and a £1.2m programme is under way to improve ventilation in every home on the Freehold Estate.

 

It is currently recruiting special advisors on asset management and tenant services, as well as a new audit chair, and from January it will be looking for a new chair of the board.

 

The spokesperson said: “Awaab’s death is a defining moment for RBH – but also for the wider housing sector. While it should never have taken a tragedy for change to happen, Awaab’s Law must be introduced to ensure there is lasting change.

 

“There are hard lessons to learn: process must never get in the way of people; tenant voice must always be valued; maintenance and property renewal should be prioritised; and tenant safety must always be the first and foremost consideration.

 

“As we move forward, our priority is to continue delivering on our improvement plan as quickly as possible so that our homes are safe and comfortable. Under renewed leadership, RBH is determined to rebuild as an effective, responsive and tenant-focused organisation that has mutuality at its heart.”

RBH maintained its V2 financial viability grade.

 

In its regulatory judgement, the RSH said that in this high inflation environment, RBH’s large-scale regeneration project which requires significant capital, gives rise to material risks to manage that could reduce its capacity to respond to adverse events.

 

Furthermore, the RSH said the nature of RBH’s governance failings and the consumer standards regulatory notice may also “give rise to material risks to grant funding and covenant compliance” that RBH will need to manage.

 

This comes after housing secretary Michael Gove said that RBH will not receive an expected £1m of Affordable Homes Programme (AHP) funding, or receive any new AHP contracts, until the RSH has concluded an investigation into the housing association. 

 

He vowed to block funding from the government’s current AHP for social landlords that breach the regulator’s consumer standards.

 

In the aftermath of the RBH scandal, Mr Gove urged social landlords to “absorb the lessons” from the death of Awaab Ishak and the RSH called on providers to submit evidence to show they have systems to identify and deal with damp and mould in homes.

 

In addition, the housing ombudsman called for a renewed focus on its damp and mould recommendations.

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