Short notice inspections of housing associations Summary of the responses to the consultation on our methodology Audit Commission Housing Inspectorate response to consultation October 2008 Responses to the consultation In July 2008 we set out in a consultation document a series of proposed changes to the methodology to be used on short notice inspections of housing associations. The consultation exercise ran until the middle of September. We received over 60 responses to the consultation paper, of which 50 were received from housing associations (HAs). Responses were also received from the Housing Corporation (HC), the National Housing Federation and the Chartered Institute of Housing. The overwhelming majority of respondents supported our general approach to short notice inspections (SNIs). This document summarises the responses as well as setting out how we are dealing with the responses in the final version of the short notice inspection methodology. Question 1 Do you agree that the main focus for short notice inspections should continue to be on those HAs that have already been inspected and received a ‘Fair’ 1 star rating? If not, what would you advocate should be our approach? There was overwhelming support for this - 41 out of 50 HAs agreed with the proposal. There was support for inspections being carried out based on risk and/or deteriorating PIs. Other responses highlighted the need for good practice to be captured as part of the process. Our initial focus will remain on those HAs that have already been inspected and received a ‘Fair’ 1 star rating, with a focus on their weaker performing services. We will, from time to time, undertake inspections in other circumstances, following consultation with the HC/TSA. Responses to the consultation Short notice inspection consultation summary Question 2 What is your preferred approach for scoring the quality of inspected services – is it the current star rating system or a statement about the relative strengths and weaknesses? There were mixed views on this although the largest single group favoured the use of statements. Twenty-three respondents advocated the use of summary statements rather than star ratings. A number of reasons were given, including the following: it should not be a judgement on the whole organisation; SNIs should be seen as different to the standard inspections; and star ratings have the potential to present a misleading picture of the organisation’s performance. Thirteen HAs favoured the continued use of the star ratings system on the basis that it is well known and understood within the sector. But these respondents also wanted to see SNIs clearly identified in order to avoid confusion with standard inspections. A smaller group of respondents (seven) favoured a mixed approach, using both a summary statement and a star rating for each service area. We will use word-based judgements for each of the inspected service areas rather than star ratings. There will be no composite score for Judgement 1. Question 3 What is your preferred approach for scoring the prospects for improvement – do you agree that we should retain the current system and terminology or is there an alternative approach that you can suggest? There was broad support for retaining the existing terminology as it is readily and easily understood by the sector (30 out of 50 in favour of retention). There were mixed views on publishing Judgement 2 separately. Of the 15 who expressed a view, 11 were in favour, two were against and the other two preferred to see a statement on the course of action to be taken rather than prospects for improvement. We will retain the scoring system for Judgement 2, which will be based on the prospects for improving the inspected services only. Responses to the consultation Short notice inspection consultation summary Question 4 Do you agree with the proposals for increasing the focus on customer involvement? What, if any, further changes would you propose in order to increase the involvement of customers in the assessment of services during an inspection? All respondents were in agreement with the proposals for increasing the focus on customer involvement. A range of views on the merits of the various forms of involvement were suggested, including a request not to place too much emphasis on focus groups, providing more notice to the HA (for example ten days) in order for more reality checks to be undertaken, and comments about the statistical validity of telephone calls to tenants. Some were concerned that tenants might not be able to participate at short notice. Another suggestion was that customer involvement should become the fourth cross-cutting theme. There were also questions raised about reality checks in general, but these were not dissimilar to those asked before a standard inspection. We will use a wide range of methods, as detailed in our consultation paper, to engage and seek residents’ views before, during and after the inspection, thereby increasing the focus on customer involvement. Responses to the consultation Short notice inspection consultation summary Question 5 Do you agree with the proposals for changing the scope of short notice inspections? What do you think of applying the short notice period to all of our inspections? The majority of respondents who answered the question directly (23 out of 41) agreed that the scope of SNIs should be the weaker service areas, but had reservations about applying the five-day notice model to all inspections. Some of the comments have been summarised below: • The value of inspection is also in the preparation. •What about logistics? Will the inspection teams and HA staff have enough time to prepare? How much documentation will be needed? • How feasible is it? There is a risk of inaccurate assessments. • This could place a bigger burden on the HA and its staff. • Five days is too short and restrictive a notice period – ten days may be a better solution. • The idea needs more consideration and consultation. A number of respondents flagged up the need to capture positive practice both for organisational learning and the sector’s reputation. Flexibility in determining the scope would, they suggested, assist in this process. Initially, the scope of short notice inspections will remain the weakest service areas, but in future and in the light of discussions with the TSA, this may change. We will continue to give five working days’ notice to HAs of a short notice inspection. We do not propose making any changes to the notice period for standard inspections at this stage. Responses to the consultation Short notice inspection consultation summary Question 6 Do you agree that short notice inspections should include an assessment of the Commission’s three cross-cutting themes of access and customer care, diversity, and value for money (VFM)? The majority of respondents (36 out of 50) were in favour of retaining the three cross-cutting themes, viewing them as fundamental to the inspection process, with a few suggesting that resident involvement should become the fourth cross-cutting theme. Some respondents suggested that the cross-cutting themes should be related to the service areas being inspected and not to the organisation as a whole. A smaller number thought that the crosscutting themes should only be included if the organisation had received low scores in these areas in earlier inspections. Other comments received included the following: •Only include access and customer care, but VFM and diversity should feature in standard inspections. • SNIs do not do justice to these areas. • It should be flexible and negotiable. •We agree to keeping three cross-cutting areas but would also like focus on governance and management capability, as these are weak in poorly performing organisations. • It catches things missed by other means. • Yes, but they should not be used to extrapolate across the whole organisation. The three cross-cutting themes will be retained in short notice inspections but our focus will be on how these themes are addressed within the service areas being inspected and not across the organisation as a whole. Responses to the consultation Short notice inspection consultation summary Question 7 Do you agree with our intention to limit the documents that are requested and accepted by inspectors? All 50 of the HAs who responded agreed with the general principle of limiting the number of documents requested. However, a few HAs put forward detailed suggestions of what the documents should be, and many wanted the flexibility to give inspectors limited amounts of additional information. Some of the comments received are listed below: • We would support a requirement to keep an up-to-date self-assessment. • Inspectors should not refuse to look at additional documents. •Short notice inspections should remain a test of how services are delivered generally, and not just when a special effort is made for inspection. • We agree with fewer documents but it could lead to a lack of understanding. • This makes sense – all organisations have the ability to shine, regardless of who the inspector is. •It is known that inspectors are overwhelmed with information – careful consideration needs to be given to the list of information required and the format. • A limit on documents is needed – we suggest up to three additional documents. We will retain the use of a small number of performance reports. However, HAs will have the flexibility to submit up to a maximum of ten additional documents – five at the pre-site stage and five during the onsite stage. HAs will have to provide a brief statement with each additional document saying why it is important and which parts of the document are relevant to the inspected services. Responses to the consultation Short notice inspection consultation summary Question 8 Do you think that HAs which are having a short notice inspection should not be required to prepare and submit a short and focused selfassessment, or do you think that this would be a helpful requirement that would benefit both the HA and the inspectors? All respondents were in favour of HAs providing a self-assessment. There was a difference of opinion on whether this should be a regulatory requirement – 14 HAs supported this approach, 7 said it should be optional, while 29 did not express a preference. Typical comments received were: • • • • • Self-assessments are helpful and should be a requirement. There is not enough time to prepare a self-assessment in five days. Permit them, but do not require them. HAs should have one as a matter of good practice. The compliance statement should be modified. HAs will not be required to submit a self-assessment. However, the inspectors will receive and review any existing self-assessment document that is submitted by the HA. Question 9 Do you agree with our overall approach to short notice inspections for housing associations? A large proportion of respondents (41 out of 50) agreed with the overall approach. The remainder did not express a view. Among the comments received were: • The real proposal here is that inspections become short notice. •A lot of advantages but we are concerned about how this affects the standard inspection timetable. •Approach is broadly acceptable but we need to ensure that the scoring mechanisms and reporting mechanisms are handled fairly. • Other public services are inspected at short notice, so why not housing? The approach used during our pilot programme and outlined within our consultation document will be adopted as the preferred methodology, but with some changes to reflect the results of the consultation process. Responses to the consultation Short notice inspection consultation summary Question 10 Do you have any further suggestions which you would like us to consider? •We hope the AC will continue with its intention to ensure that all HAs receive a full standard inspection. •We would suggest that the AC needs to raise awareness of the availability of its advice and assistance services, especially within the context of a reduced inspection framework. •The AC should train and use a small, qualified pool of HA staff to become involved in short notice and standard inspections with the AC. This would enable the dissemination of knowledge and good practice within the sector and make the process more open and transparent. • Further clarification is required on the role of the lead regulator. •The current proposals equate haste with the concept of short notice and are overly hung up on the idea that short notice means five days. We think that the focus should be on delivering high quality, respected inspection products in a reasonable period of time. •We do not accept, as the consultation paper does, that the key lines of enquiry (KLOEs) should continue to be the basis of the inspection. Rather, we would suggest that the retention of KLOEs in the long term needs a radical rethink. In our view, associations as independent organisations must meet agreed standards as part of a contract with the regulator. •We are concerned about the proposed two-stage approach whereby residents shape an improvement plan and then the Commission uses that document to assess prospects for improvement. Production of a plan tells inspectors little about future prospects and making judgements about a plan shaped by residents is divisive. Understanding the wider service experience for residents and genuinely embracing their views must be the key aims for inspectors. The comments and suggestions received during the consultation period have been invaluable in developing the approach to short notice housing inspections. We will continue to reflect upon and consider the contributions, which will be taken into account during future adjustments to the inspection methodology. We would like to thank all of the HAs, individuals and other stakeholders for their contributions. Responses to the consultation Short notice inspection consultation summary The Audit Commission is an independent watchdog, driving economy, efficiency and effectiveness in local public services to deliver better outcomes for everyone. Our work across local government, health, housing, community safety and fire and rescue services means that we have a unique perspective. We promote value for money for taxpayers, covering the £180 billion spent by 11,000 local public bodies. As a force for improvement, we work in partnership to assess local public services and make practical recommendations for promoting a better quality of life for local people. © Audit Commission 2008 This document is available on our website at: www.audit-commission.gov.uk If you require a copy of this document in large print, in Braille, on tape, or in a language other than English, please call: 0844 798 2116 If you require a printed copy of this document, please call: 0844 798 7070 For further information on the work of the Commission please contact: Audit Commission, 1st Floor, Millbank Tower, Millbank, London SW1P 4HQ Telephone: 0844 798 1212 Fax: 0844 798 2945 Textphone (minicom): 0844 798 2946 www.audit-commission.gov.uk