Stock transfer has been a major success, argues Mike Crozier
In the early 1990s the then national housing agency, Scottish Homes, embarked on a process to divest itself of its directly owned and managed housing stock, numbering some 98,000 homes throughout the country. The objective of this policy was to develop a more independent rented sector through the encouragement of a range of alternative landlords. One of the first stock transfer landlords to emerge from this process was Weslo Housing Management, a private company limited by guarantee, with charitable status, which purchased 1,800 properties in West Lothian from Scottish Homes for £16 million in 1994 and a further 498 properties in Bo’ness for £5m in 1997. Now, as we approach our 21st anniversary, and reflect on what the organisation has achieved, can stock transfer be considered a success? Here is a snapshot of Weslo’s experience two decades on.
During the consultation process prior to transfer, we promised tenants that the local service from Weslo would be better and more responsive than they had been receiving from Scottish Homes. Weslo would be a small, locally focussed landlord with tenant representation on its board of management, which would channel rental income towards improving and maintaining its own properties in the most cost effective and efficient manner. That was made possible in part by exploiting the opportunity to develop creative business plans with supportive legal structures in a way not possible previously. By contrast, Scottish Homes was a large national organisation that pooled the rents for 98,000 houses spread across Scotland and was subject to restrictive rules around governance, borrowing and annuality of spending. This annuality itself created many problems with budgets and spend being allocated from year to year, resulting in ineffective long-term planning and wasted investment on low-priority projects crammed in before the financial year end to avoid “loss” of the money.
Since 1994 Weslo has spent well over £20m on planned maintenance and improvement to its properties. We undertook to complete 100 per cent of repairs within their stated response times – a target derided by some at the time as not possible – but today we regularly achieve this for around 900 repair jobs per month. How do we manage this? Whereas Scottish Homes employed external contractors, our in-house trades force provide our repairs service. Not only has this led to greater control over the delivery of the service to tenants and enabled us to introduce and manage efficiencies, it has also allowed us to create jobs locally for over 20 tradesmen and apprentices.
Indeed a material by product of our stock transfers has been the emergence of Weslo as a significant employer in West Lothian. The company has grown from a core staff of 26 in 1994 to one which now employs over 80 staff across three offices all dedicated to serving our tenants and indeed other service users. Our most recent tenant survey last year indicated that 93 per cent of tenants are satisfied overall with the service they receive compared to the Scottish average of 88 per cent for registered social landlords and councils. A baseline survey of tenant satisfaction levels taken in 1994 indicated only 75 per cent of tenants were satisfied overall with the service they had been receiving at that time from Scottish Homes.
Whilst it is impossible to say what level of service and investment would have been delivered had Scottish Homes continued in its role, it is unlikely that the improvements achieved by Weslo would have been delivered by a large, centrally controlled quango. Certainly Scottish Homes could not have accessed the £25m of private finance which Weslo has attracted to provide additional affordable housing. There are of course similar stories elsewhere across the country, with many of the other stock transfer landlords able to report similar achievements, albeit with one or two exceptions.
The stock transfer policy formed an important part of a wider government commitment to engage locally with communities through the creation of smaller locally based and managed organisation. It has come to represent not so much a political initiative to alter the role of public sector housing but rather a model which recognises the value of decision making within communities at grass root level. We should continue to build on this success.
• Mike Crozier is operations director at Weslo Housing Management, www.weslo-housing.org