17 Aug 2023
Behind the numbers: Breaking down the LGA’s Professionalisation of Housing Survey
The Social Housing (Regulation) Act passed into law last month, marking the government’s commitment to boosting standards and professionalisation within the sector. While these changes are welcome, they will require extra investment on the part of housing providers such as local authorities, as outlined in a new report by the Local Government Association.
In anticipation of new housing professionalisation requirements, the Local Government Association (LGA) recently undertook a survey of local authorities in England to gauge how they are preparing for the changes.
One of the most notable elements of the new requirements is for senior housing managers to be qualified up to a certain level. The LGA report found that 66 per cent of senior housing managers at respondent councils are not yet sufficiently qualified to meet the new requirements, with 54 per cent of senior housing executives likewise requiring further qualifications.
Further, 62 per cent of respondents said they would not feasibly be able to ensure 100 per cent compliance with the required level of qualifications within a two-year period, given their current resources.
The headline finding, however, was that the new requirements will cost councils a combined total of £17.9m in the first two years, and £3.7m every year after that.
We’ve looked at the LGA’s ‘Professionalisation of Housing Survey’, analysing the report’s key findings and the main takeaways for local authorities.
Response rate
The first thing to note about the LGA’s findings is that they are based on a relatively small number of responses. Two-hundred-and-fifty-nine applicable local authorities were invited to take part in the survey, with 42 (16%) submitting a response.
The headline £17.9m finding was based on a smaller pool of respondents, with 27 of the 42 local authorities who completed the survey providing an estimate of costs.
The sample size is something the LGA highlights in its report: “This level of response rate means that these results should not be taken to be more widely representative of the views of all councils. Rather, they are a snapshot of the views of this particular group of respondents.”
The highest response rate overall was from councils with more than 20,000 homes under management, at a rate of 30 per cent. Conversely, 10 per cent of councils with a stock of 1,000 homes or fewer submitted a response.
It is also worth noting that the response rate was highest in Greater London, at 26 per cent, and lowest in the north-west and the south-east, each at 8 per cent.
What does the report mean for local authorities?
It remains to be seen whether how closely the extra costs councils will incur because of the new professionalisation requirements will align with the LGA’s projections. Nevertheless, it is clear local authorities will need to make an investment in this important area.
What kind of investment is unclear, though, as the report also shows the cost to individual local authorities could vary wildly. One respondent said the new professionalisation requirements would cost them £1m per year during the initial two-year period; while several respondents said they expected housing costs to rise by no more than £1,000 per year due to the changes. The average cost for local authorities is estimated at £90,000 over the initial two-year period.
Aside from cost, the LGA survey suggests local authorities may find difficulty in recruiting and retaining housing officers, with 80 per cent of respondents saying the new requirements will have “a great or moderate” impact.
Findings such as these are why the CIH has been calling for all housing providers to start preparing for the changes sooner rather than later, as doing so will help to minimise disruption and smooth the path to positive change.
How severe is the extra cost?
While the report’s headline figure of £17.9m might seem big, the sum is dwarfed by the amount councils spend on housing as a whole. According to the most recent government data, councils spent more than £2.1bn on housing during the 2021-22 financial year alone.
The figure also pales when compared with the amount councils are spending in other areas. During 2021-22, for example, councils spent a combined total of £30bn on social care and nearly £35bn on education. Councils’ total net service expenditure for the year clocked in at £107bn.
But while £17.9m represents a small portion of councils’ wider expenditure, it is by no means insignificant; and the extra cost comes at a time when public purse strings are becoming increasingly stretched - not to mention the existing pressures facing councils’ housing revenue accounts.
Government support
In a follow-up to its report, the LGA called for the government to fully fund any additional costs brought about by the new professionalisation requirements. It has also called for more time to implement the changes.
The government has not yet committed to doing either of these; though, any support it can give to the sector will no doubt be welcomed by local authorities and housing associations alike.
The CIH will continue to work with the Department of Levelling Up, Housing and Communities (DLUHC) and with members on implementation of the new requirements. We expect to see a consultation on the detail in the coming months.
The CIH also welcomes continuing research in this important area.
When the LGA initially published its report, we said: "This new research by Local Government Association highlights the commitment by the sector to support housing staff to gain housing qualifications to help them in their roles.
"We echo the LGA’s call for government to ensure these changes are carefully and properly managed.
"It is essential government work with the sector to ensure the qualifications requirements in the Social Housing (Regulation) Act have a realistic implementation timescale, and government funding to ensure the changes do not add further pressure to organisations’ resources that are already stretched."
