New scorecard system launched to measure the efficiency of social housing providers

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The end of January saw the launch of a pilot scorecard system which is geared to allow comparison between similar organisations within the social housing sector with a focus on their efficiency. At the same time it aims to recognise that there is a level of diversity within the industry which must be accounted for.

The scorecard system has been devised by The Efficiency Working Group, a team of fifteen housing associations headed by Mark Henderson, the chief executive of Home Group. They have established fifteen indicators which they believe can be utilised by housing associations to collect metric data which can then be analysed and used to assess both their own performance and that of other industry participants, as well as showing whether the services they provide offer value for money.

The Housing Minister Gavin Barwell, along with groups such G15, G320, Placeshapers, CIH and Homes for the North, has provided his backing and support for the scheme.

Mr Barwell said:  “I welcome this initiative to develop a set of common efficiency metrics for the housing association sector.

“The sector has a vital role to play in providing the homes we need, and housing associations need to be able to demonstrate that they are making the best possible use of their resources to deliver for the communities they serve.”

The indicators set to be measured focus on the following five areas of business: business health, development, outcomes delivered, effective asset management and operating efficiency.

The specific indicators measured within these categories are:

  1. Operating margin
  2. Increase/decrease in operating margin
  3. EBITDA MRI (as a percentage of interest)
  4. Units developed
  5. Units developed (as a percentage of units owned)
  6. Gearing
  7. Customers VFM satisfaction
  8. Investment in new housing for every £1 generated from operations
  9. Investment in communities for every £1 generated from operations,
  10. Return on capital employed
  11. Occupancy
  12. Ratio of responsive repairs to planned maintenance spend
  13. Headline social housing cost per unit
  14. Rent collected
  15. Overheads as a percentage of adjusted turnover.

The pilot scheme is set to run for a year in order to sufficiently test the indicator system as well as the value of the data it provides. The Efficiency Working Group is hoping as many housing associations as possible will participate in the scheme to help shape how it operates once the pilot period is over.

On this point Mr Henderson said, ‘Formulating the 15 indicators is a great starting point, but what we really need now is for the wider sector to embrace this and sign up to the pilot on mass. By gaining the support and involvement of as many providers as possible we’ll be able to further refine the metrics and ensure we have a system which, not only fully reflects the needs of the sector, but acts as robust mechanism for years to come.”

For further details, including how to participate in the scheme contact:

“Pennington Choices supports the implementation of the scorecard system and hopes to see a high level of participation from housing associations”

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