Europe ruling threatens to kill off local tenant power

Europe ruling threatens to kill off local tenant power
Stephen Stewart
The Herald

The future for the tenant control of homes in Glasgow will be decided later today.

Thousands of tenants could face disappointment if Glasgow Housing Association, which was set up to devolve power to local groups, effectively elects to take power back from grassroots community organisations.

The move, which critics claim would mark a return to monolithic centralised local authority control, would be a potential PR disaster for the executive’s flagship project of housing stock transfer.

GHA’s board meeting today follows a European Commission ruling which meant that the process of devolving control of the housing stock would possibly have to be put to tender across Europe.
GHA has legal pacts with more than 60 local housing organisations (LHOs) to allow tenants to have a say over about £2bn-worth of housing investment.

However, earlier this month it emerged that the process known as second stage transfer, the organisation’s fundamental goal, would have to be tendered across Europe after the government accepted a commission ruling classifying registered social landlords as ‘public bodies’.
Executive advice prior to GHA being established was that registered social landlords like local housing groups, were not subject to procurement legislation.

A senior figure in one of the LHOs said: ‘There has been an abject failure by GHA to do anything of any great note. Malcolm Chisholm (the communities minister) has said second stage transfer will happen but we are no further forward.

‘There will be a huge political fallout from all this if power flows back to the centre. Promises have been made by GHA to disaggregate as soon as possible, but now we have an organisation which could end up being more monolithic than the council.’

The majority of pacts between GHA and local housing bodies will expire next April, but cannot be renewed without breaching the EC laws. GHA said the Europe-wide tendering was only one option being examined, and the Scottish Executive was lobbying for the rules to be waived.
The association’s main aim is to prevent the cyclical decline which has dogged the city’s beleaguered housing sector which, for decades, has faced episodic periods of investment followed by lapses into decay.

The disaggregation of the housing stock has also been affected by differing expectations between GHA and local groups about valuation of homes.

One possible solution touted is the federalisation of local committees with the sharing of services and procurement programmes. But this in turn has created murmurs of discontent and allegations that it breaks the spirit, if not the letter, of the original transfer agreement.

Michael Lennon, GHA chief executive, maintained that the organisation was meeting the challenge and renewed his commitment to second stage transfer despite the apparent setbacks.
He cited their impressive record on improvements since transfer including the installation of more than 20,000 central heating systems, nearly 7000 roof repairs, and the fitting of almost 6000 bathrooms.

He said: ‘We have a very strange remit in that we have to dramatically improve the housing services and management. We must physically upgrade the stock and break GHA up to pave the way for full community ownership. All of this has to be done at the same time.

‘There are 62 LHOs in Glasgow, which is a large amount in a city of 600,000 people. We are under strong pressure to just dish these houses out. But we are under an obligation to engage with local groups and think through their terms of development and organisation. We have openly committed to transferring half of the entire stock by 2008 and that hasn’t changed.’

An executive spokesman said: ‘Any speculation that this will affect the GHA’s investment programme is premature. We are committed to the transfer of housing to communities and are getting on with it as quickly as we can.’

GHA was set up in 2003 to take control of Glasgow City Council’s 80,000 housing stock.
The association
– Glasgow Housing Association (GHA) took over the responsibility of 80,000 council homes two years ago after a vote by tenants.
– It is a not-for-profit association and is now the largest registered social landlord in the UK.
– It collects £192.3m in rent over a year and it is estimated that the company is owed £9.4m in overdue rents.
– The chief executive is Michael Lennon, a Scots-born academic, who was previously carrying out the same role for the Housing New Zealand Corporation.