Decision

Previous regulatory judgement: Onward Group Limited (30 November 2022)

Updated 25 October 2023

Applies to England

RSH Narrative Regulatory Judgement

• Provider: Onward Group Limited
• Regulatory code: 4649
• Publication date: 30 November 2022
• Governance grade: G1
• Viability grade: V2
• Reason for publication: Viability regrade
• Regulatory route: Stability Check and Reactive Engagement

Regulatory judgement

This regulatory judgement regrades Onward Group Limited’s financial viability from V1 to V2 and confirms its existing G1 grade for governance.

The regulator has assurance that Onward Group Limited (Onward) continues to comply with the financial viability elements of the Governance and Financial Viability Standard. Onward has an adequately funded business plan, sufficient security in place and is forecast to continue to meet its financial covenants under a reasonable range of scenarios.

Onward is investing in its stock and revising its pension arrangements and as a result, interest cover is reduced. Additional investment will also be required to achieve energy efficiency targets and delivery of these objectives, in conjunction with economic uncertainty in relation to inflation and interest rates, means that Onward’s capacity to respond to adverse events is reduced.

The regulator’s assessment of Onward’s compliance with the governance elements of the Governance and Financial Viability Standard remains unchanged. Based on the evidence gained from the Stability Check, the regulator has assurance that Onward’s governance arrangements enable it to adequately control the organisation and to continue meeting its objectives.

Other providers included in the judgement

Onward Homes Limited

About the provider

Origins

Onward is a non-asset owning registered parent. Its activities relate to the provision of social housing, including low cost home ownership.

Registered Entities

Onward Group Limited is the Group parent and a non-charitable registered society.

Onward Homes Limited is a charitable subsidiary and owns social and affordable homes.

Unregistered Entities

• Onward Build Limited, a development company;
• Onward Pension Trustee Limited, provides Trustee services for the Onward Pension Plan Scheme;
• Contour Property Services Limited provides property management services;
• Onward Repairs provides repairs services;
• Atrium City Living Limited is an investment vehicle in two joint ventures that will deliver new homes; and
• Contour Homes is a former registered entity that is currently dormant.

Geographic Spread and Scale

Onward operates across the north west of England in 30 local authorities. It owns and manages around 35,000 homes.

Staffing and Turnover

For the year ended 31 March 2022, Onward reported a turnover of £159.8m and employed 878 full-time equivalent staff.

Development

Onward has a target of delivering 5,200 new homes between 2022 and 2030. The new homes will be a mixture of affordable rent, shared ownership and market sale units.

About our judgements

Key to Grades

Governance:

	Compliant
G1	The provider meets our governance requirements.
G2	The provider meets our governance requirements but needs to improve some aspects of its governance arrangements to support continued compliance.

	Non-compliant
G3	The provider does not meet our governance requirements. There are issues of serious regulatory concern and in agreement with us the provider is working to improve its position.
G4	The provider does not meet our governance requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Viability:

	Compliant
V1	The provider meets our viability requirements and has the financial capacity to deal with a wide range of adverse scenarios.
V2	The provider meets our viability requirements. It has the financial capacity to deal with a reasonable range of adverse scenarios but needs to manage material risks to ensure continued compliance.

	Non-compliant
V3	The provider does not meet our viability requirements. There are issues of serious regulatory concern and, in agreement with us, the provider is working to improve its position.
V4	The provider does not meet our viability requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Definitions of Regulatory Routes

In Depth Assessment (IDA): An IDA is a bespoke assessment of a provider’s viability and governance, including its approach to value for money. It involves on-site work and considers in detail a provider’s ability to meet its financial obligations and the effectiveness of its governance structures and processes.

Stability Checks: Based primarily on information supplied through regulatory returns, a Stability Check is an annual review of a provider’s financial position and its latest business plan. The review is focused on determining if there is evidence to indicate a provider’s current judgements merit reconsideration.

Reactive Engagement: Reactive engagement is unplanned work which is triggered by new information or a developing situation which may have implications for a provider’s current regulatory judgement.

Stability Checks and Reactive Engagement: In some cases, we will publish narrative regulatory judgements which combine evidence gained from both Stability Checks and Reactive Engagement.

For further details about these processes, please see Regulating the Standards.