Tick icon
I am the notification bar, pleased to meet you.
Close close icon
Arthur J Gallagher featured add

Looking to feature your news?

Submit your articles to appear in members news

Click Here

SFHA convenes Social Housing Financial Resilience ForumĀ 

Blog by Shona Mitchell, SFHA Policy Lead 

Posted In

SFHA has convened the Social Housing Financial Resilience Forum which will meet monthly to discuss the financial impact of the Covid-19 outbreak on our sector and what action we might need to take as a result. 

The first meeting took place in mid-April and joining the call were several SFHA members of different sizes and geography, Scottish Housing Regulator (SHR) staff and Scottish Government housing civil servants. UK Finance has been asked to join future calls. 

Topics for discussion were the concerns raised with commercial lenders (which are outlined in the SFHA finance briefing here), what support we hope the Scottish Government can provide for the sector and what support and flexibilities SHR can offer during this crisis and the following recovery period. 

The group seeks to understand what the financial issues are for the sector, their impact and what needs to be done. 

It was agreed the financial impact of the current crisis will not be a short-term one for the social housing sector. It is anticipated the effects will be felt for an extended period of one to five years. Covenant cover over the longer term is a particular concern due to the increased levels of spend required post crisis to catch up and meet other obligations. 

Housing association income is derived mostly from rental income, and rents have become difficult for a number of tenants due to their own income being impacted by the coronavirus outbreak. It will take a number of months to determine the true impact on rental income, but, in the meantime, the message from the sector is that anyone who can pay their rent should to continue to do so, and anyone with concerns about their ability to pay their rent should contact their landlord who can offer support. 

Other financial risks come from new homes in the development pipeline not being completed and therefore not bringing in the expected rental income and impacting covenant cover. The cost of repairs, contractors and various services are also increasing. In a number of cases, the level of insurance held by associations is not enough to cover the price increases.  

In terms of current support for the sector, SHR and lenders are both clearly stating they are trying to be as understanding and flexible as possible, but associations should speak to them as soon as they have any concerns about not meeting obligations or deadlines. The experience of members in these discussions so far has been positive, which is a good sign. 

To support the sector in the longer term, SFHA is shortly due to begin asking members to complete a monthly data return to enable us to track the financial impact on the sector which, in turn, will be used to build the evidence-based case we require to lobby government for an adequate financial support package for the sector. The figures are all pieces of information collected by associations for other purposes, so we hope as many members as possible will support us by returning this to us. Both the Scottish Government and SHR have seen the proposed data return and are supportive of the content. 

And looking to the future, both SFHA and SHR are keen to hear from the sector about any support you’d like to see from us during the recovery phase when we reach that point. Information can be sent to Ian Brennan at SHR Ian.Brennan@shr.gov.scot as well as to me smitchell@sfha.co.uk.   

SFHA wishes to express our thanks to all involved, and we are confident that, together, we can provide the practical and financial assistance the sector requires in the months and years ahead. 

×
Url has been copied