How Much is too Much Regulation?

The importance of community

The Scottish Housing Regulator’s current consultation on reforms to the regulation of social landlords in Scotland has sparked controversy within the sector (see for example, recent articles in the Glasgow Herald and Inside Housing, and briefing papers by the community housing sector).

The biggest moot point is over plans to introduce a mandatory fixed-term for committee members (who make up landlords’ governing bodies).  This change is especially problematic for small, community-based housing associations (a dominant governance model in the west of Scotland), because their management committees are drawn from ordinary local residents.  The passion, commitment and local knowledge of these individuals, combined with the partnerships they forge with local housing staff have been central to the success of this governance model; and the skills and experience these community leaders develop over the years is invaluable. That the Regulator wants to consign this to the scrap-heap is sad indeed, especially when most committee members are already subject to regular, open elections.  A second related concern is the proposal to pay governing body members.  This not only contradicts the ethos of volunteering and place based social capital that underpins the community housing sector in Scotland, but seeks to introduce a ‘private sector’ governance model which is inappropriate for community organisations, many of whom are also registered charities.  There seems to be a real tension between the Regulator’s desire for ‘professional’ boards and the benefits of community governance through the community ownership of social housing.

Beyond this immediate issue, the consultation also sparks questions about how much is too much regulation?  There have long been concerns that housing associations are over-regulated compared to other independent, third sector organisations. Whilst housing association do receive financial support from the public purse does that mean the Regulator should be able to dictate the terms of their constitution, or how they govern themselves?  Or would the regulatory gaze not be better directed on the Private Rented Sector which is where the real rogue landlords are to be found?  Answers on a postcard …..

(for further discussion of mandatory terms see the excellent paper by GWSF )



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4 Comments to How Much is too Much Regulation?

  • Jenny Muir says:

    In Northern Ireland we’ve just had a maximum term of 9 years introduced, i.e. 3 sets of 3. Although more generous than what’s proposed in Scotland, it’s difficult for 2 reasons. First, it can be hard to find enough Board members anyway (and we don’t have CBHAs); second, it needs to be managed carefully to ensure that all the more experienced members don’t leave at once.

    Although there were perhaps a few Boards in NI where people needed to be prized out of their chairs rather forcefully after 20 years or more, I think this is one of the areas where government (in NI and Scotland) needs to recognise the limits of how it ought to regulate third sector bodies. Surely effective regulation of third sector governance involves looking at whether the decisions an organisation has made result in good outcomes rather than being so prescriptive.

  • Jenny Muir says:

    Oh, and we don’t have paid Board members either, and no enthusiasm at all for changing this. I think it’s really corrosive of the voluntary ethos.

  • Kim McKee says:

    Thanks Jenny. I agree – making it mandatory is way too prescriptive. The place based focus of these organisations also makes it harder to recruit so it seems crazy to consign willing and experienced committee members to the scrap heap.

    I’d also question whether regulation is really a priority in the current climate, especially given its a well performing sector with high levels of tenant satisfaction and legislation already means landlords must encourage participation from the wider tenant body and also consult on key changes.

  • […] bag April 14, 2012 governance, housing policy, regulation, social housing A few months back I blogged about the consultation on reforming the regulatory framework for social landlords in Scotland (see […]

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