Regular reviews between programmed inspections
How we review the information landlords are required to send to us
Applies to England
Introduction
Alongside carrying out programmed inspections of landlords, we review a range of information which we require landlords to send us on a regular basis. We receive information between programmed inspections from both large landlords and small landlords. The information we receive from small landlords is more limited. This information helps us to understand landlords that may be at high risk of failing to deliver the outcomes of our standards. It can also inform the areas we consider we want to focus on in a programmed inspection, or it may be that we consider that the most appropriate way to follow up is through our responsive engagement.
We also use the information in regulatory returns to publish a range of information which helps us and others to understand how the sector is performing as a whole. This includes information about emerging trends and risks across the whole social housing sector and for different parts of the sector.
We are committed to minimising the burden on landlords of our information requirements by using information that landlords already collect as part of their routine activity, where appropriate.
Addressing data quality
It is important that landlords give us timely and accurate data. This is fundamental to the effectiveness of our co-regulatory approach. It is particularly important that landlords ensure that the organisational and contact details they supply to us are kept up to date. If they do not do this, there is a risk that information about the organisation may be sent to people who no longer work for that organisation. Where we identify relevant issues with the quality of data in landlords’ regulatory returns, we contact them to understand the reasons for the issue. We may then take a range of actions on data quality, which may include one or more of the following:
- We may request additional information from the landlord
- Persistent and/or significant data quality issues may result in responsive engagement or be addressed through a programmed inspection where appropriate. Our view of a private registered provider’s governance may be affected if it submits late, incomplete, or inaccurate information to us
- We may consider using our ‘collection of information’ power
Private registered providers that fail to submit their accounts to us in line with their statutory obligations are added to our published list of account non-submitters. See Guidance on Submitting Annual Accounts for more information.
Stability checks
In general, we carry out stability checks of landlords that are large private registered providers every year.
We use stability checks to help us:
- form a view about how well a large private registered provider is delivering the viability requirements of our Governance and Financial Viability Standard outside of the inspection cycle and/or
- identify issues or potential issues we may decide to explore further. That may be through responsive engagement for example, or as part of any ongoing or future regulatory engagement such as an upcoming programmed inspection.
Our stability checks involve reviewing a range of relevant information received in regulatory returns that large private registered providers are required to submit to us on an annual basis. These include the landlord’s electronic annual accounts, business plan and Financial Forecast Return (FFR).
The FFR is used to gather business planning information in a standard format. We generally expect that landlords with a parent that is a registered provider will complete the FFR at group level, meaning that the landlord will submit a consolidated FFR which includes all subsidiaries registered with us (rather than each registered provider in the group submitting separate returns), and all entities within the group that are not registered with us.
Registered providers with unregistered parents must submit an FFR for the regulated entity only.
While stability checks focus on our viability requirements, the information and analysis that we gain from them can also be a source of regulatory intelligence in relation to how well the landlord is delivering other outcomes of our standards.
Following a stability check of a landlord we may publish a regulatory judgement about how well the landlord is delivering our viability requirements. There are some circumstances where we may decide not to issue a regulatory judgement or a viability grade from a stability check.
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Annual intelligence review
We generally carry out an annual intelligence review for each large landlord. We review information and analysis we have gathered from a range of sources. This review may prompt a change in our view of the landlord’s risk profile that we consider to be material enough to change our current regulatory strategy.
There are a wide range of ways in which we might change our regulatory strategy with a landlord. For example, deciding to carry out responsive engagement, or rescheduling a programmed inspection so it is carried out sooner.
This approach helps us to focus our resources where they are most needed, in line with our risk-based approach to our regulation.
Whether or not an annual intelligence review leads to a change to our regulatory strategy for a landlord, the analysis that we gain from it is a source of regulatory intelligence and can help inform our consideration of areas to focus on in any ongoing or future regulatory engagement.
Assessing value for money
As part of our stability checks, we also review information that landlords are required to report by our Value for Money Standard. Our value for money reviews can help us identify issues or potential issues that we may decide to explore further through responsive engagement or programmed inspection, for example. They can also be a source of analysis for our wider annual intelligence reviews. Private registered providers must report their value for money performance against the metrics we define, together with their own value for money measures and targets at a group level. We expect a landlord’s own measures to mirror its strategic priorities. The details of our metrics are set out in a Value for Money technical note.
The Value for Money Standard requires landlords to publish information in their statutory accounts so that stakeholders can understand:
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performance against their own value for money targets and any metrics we set out
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how their performance compares to similar landlords
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measurable plans to address any areas of under-performance, including clearly stating any areas where improvements would not be appropriate and the reasons for this.
It is important that landlords submit accurate information to us, as set out in our requirements.
Requesting further information
If we decide to ask for further assurance and/or explanation on an issue, we engage with the landlord. We may ask for additional information to help us understand the issue.
Quarterly surveys
All large private registered providers are required to complete quarterly surveys. These returns give us a regular source of information about the landlords’ financial health, in particular their access to cash and their liquidity position. We review this information every three months.
The information landlords submit through the surveys is critical in alerting us to short-term financial viability issues and, as such, it is vital that the returns are timely and accurate. If we have concerns about any of the information supplied in the quarterly survey, we will follow up the matter with the landlord concerned.
Tenant satisfaction measures reviews
All landlords, including local authority landlords, must publish their performance against the TSMs. Large landlords must also report their TSM performance to us. TSM data is a key source of regulatory intelligence, including when scoping a programmed inspection.
We review the TSM submissions of all large landlords. As part of that review, we identify landlords which appear to be outliers based upon the TSM data they have supplied. Where this is the case, we may ask them for extra information, either
- because we have concerns about the quality of their TSM data, or
- because the landlord has been identified as being potentially at a higher risk of failing to deliver the outcomes of our standards.
Where a landlord’s TSM data suggests they may be at a higher risk of failing to deliver the outcomes of our standards, we will engage with the landlord. We will decide on the most appropriate course of action on a case-by-case basis, but it may be for example that we decide to carry out responsive engagement and/or carry out an inspection.
We do not assess how well a landlord is delivering the outcomes of our standards or update a landlord’s consumer grade using the TSM information in isolation. Where a landlord already has a consumer grade, we do not update it following a review of its TSM information alone.
We collate the TSM information large landlords submit to us each year and publish the results. We may also decide to publish other TSM information, including contextual information, if we consider it will help ensure that landlords’ performance against the TSMs is clear, comparable, and accessible for tenants.
Monitoring landlords’ improvement plans
Where we have given aregulatory judgement that a landlord needs to improve, we expect the landlord to develop and implement a plan for how it willdeliver the required improvement. We will actively engage with the landlord to monitor its progress against its improvement plan.
Small landlord account reviews
We carry out an annual review of the accounts of small private registered providers. We do this in order to monitor their financial viability and help to identify any issues that may be a risk to their viability. Following our review, we decide whether to carry out any further work, which may include asking for further information. If we have serious concerns about the financial viability of a small private registered provider, we may engage with them.
Rent data reviews
The Rent Standard applies to all landlords, including local authority landlords. All rents must be set in accordance with our Rent Standard.
We regulate rents at the landlord level, in the same way as we do in our overall approach to regulation, seeking assurance that landlords have appropriate controls and assurances to ensure that rents are being set and charged correctly. We expect landlords to be aware of all relevant rent rules, and to comply with them.
Landlords submit rent data as part of their annual Statistical Data Return or Local Authority Data Return. We use this information to identify landlords that appear to be outliers based upon the rent data they have supplied. Where we identify outliers or issues of concern, we follow up with those landlords to gain more information, and to distinguish between data quality issues and substantive issues, such as rents being calculated incorrectly. Where appropriate, we may carry out responsive engagement, and in the case of large landlords, we may include issues relating to the Rent Standard within our scope of a landlord’s inspection if we consider that to be the appropriate route.
We publish separate guidance about how housing associations and other private registered providers can seek an exemption from adhering to the Rent Standard. Local authority landlords seeking an exemption should follow the guidance produced by the Ministry of Housing, Communities and Local Government.
Annual engagement meetings
We may arrange to meet the executive teams of some landlords in years when we are not carrying out a programmed inspection. We usually hold these meetings with landlords that:
- are larger and more complex, including local authority landlords
- Are private registered providers that may be planning a significant change in strategy or have recently undergone such a change, for example a merger
- have undergone a change to their risk profile, including small landlords where appropriate.
We may also decide to invite the chair or other board members/councillors to attend the meeting.
We use these meetings as an opportunity to discuss the landlord’s current business plan and/or strategic objectives. Within the context of our co-regulatory approach, these discussions help to ensure that we have an accurate and up to date understanding of a landlord’s strategic priorities and emerging risk profile. These discussions also help us to keep pace with changes to the operating environment of the sector and means we can respond to any emerging themes, where necessary.