value for money

#CoopHousing15

Value for Money

Value for Money

Question: what does the phrase Value for Money mean to you?

Please think of three words or phrases that sums it up

Background

• introduction of Value for Money standard in England in 2012

• requirement to produce annual Value for Money statements

• linked to housing associations maximising new build

• some associations downgraded because of their VFM statements

• how much is this relevant to co-ops?

Further background

• changes to Rent Standard to reduce the housing benefit bill

• rent capped at CPI plus 1% increase• rent reduction to -1% for four years• big impact on housing associations• effect on co-op business plans?• introduction of Universal Credit• welfare benefit changes

Value for Money

• what will the regulator do re. co-ops?

• whatever happens, there is a need for co-ops to focus on Value for Money

The regulatory standardRegulatory goobledegook

What does it mean?

Robust approach – understanding trade offs and opportunity costs

When making decisions, considering alternatives that could cut costs

Optimising future returns on assets

Making as much money as you can out of your homes

Potential benefits in alternative delivery models

Could you do things differently & save money?

VFM performance management

Examining all areas of the business to save money

Understanding costs and outcomes

Knowing what your money is delivering for you

The regulatory standardRegulatory goobledegook

What does it mean?

Robust annual VFM self-assessment

Setting out what you are doing to achieve VFM

Transparent and accessible to stakeholders

So that people you work with understand (tenants?)

Returns on assets against organisation objectives

Are you doing what you set out to do as well as you can?

Absolute & comparative costs of specific services

How much does it cost you to do things? How does this compare with others?

Evidencing VFM gains Prove it mate!

Value for Money

• is it all about money?

• economy – comparative service costs

• efficiency – are your resources arranged to deliver what you want?

• effectiveness – are you achieving the outcomes you want?

Housemark approach

Social hearts, business heads: new thinking on VFM for housing associations

The Housemark approach

1 purpose – what are we here for?2 right activities – are we using our

resources in the right way to achieve our purpose?

3 right assets – are we using our homes and people in the right way?

4 right delivery – are the ways we are working efficient in delivering what we want?

5 right outcomes – are we achieving what we wanted to? How are we using what we’ve saved? What have we learnt?

How does this work for co-ops?

1 purpose – what are you here for? What outcomes do you want to achieve?

Eg:• high quality homes• good services• strong supportive community• helping individual members with their lives

How does this work for co-ops?

2 right activities – what resources do you use?

• are you making the best use of your members?

• what staff do you have? Either directly employed or through a provider

• what contractors do you use?

How does this work for co-ops?

3 right assets – how are you using your homes and other assets? How are you using your people?

• using homes to house people• but are you using their borrowing leverage?• is your staffing arrangement the right one?

How does this work for co-ops?

4 right delivery – for each of your services, is what you are doing producing the best economy, efficiency and effectiveness?

5 right outcomes – are you achieving your purpose? What are you doing with your surplus? What are you learning?

An Investment not a Cost

• investing in tenant involvement can produce financial, service, social and community benefits

• the housing sector needs to be doing much more to identify and publicise the business and other benefits that derive from involvement

What benefits come from involving members in a co-op?

• are there cost savings?• are we getting tenant satisfaction?• are there service benefits?• does it mean you can communicate better?• is anti-social behaviour tackled better?• what is the social dividend – eg. community

support networks, things for young people?• what does it do for co-op members

involved?• what does it do for staff members involved?

• 20/20 Housing Co-operative• community intelligence• scrutiny of what’s going on• knowing our members• common sense of tenants• identity, pride and ownership• it all equals quality that

cannot be bought through staff or consultants

Investing in Involvement

• project in the housing sector to develop a basic commonly accepted framework for identifying the benefits of tenant involvement

• Investing in Involvement statements• framework launch at end of year• getting people signed up

Value for Money

#CoopHousing15