The Regulator of Social Housing (RSH) has published its 2020 Sector Risk Profile, setting out the risks the sector faces over the coming year.
In an uncertain economic environment with competing priorities and changing expectations, all bringing potential financial pressures and reputational risks, the RSH has identified five key risks that it says providers must manage and mitigate.
These risks are:
- Ensuring the quality of stock, including changing expectations about building safety and energy efficiency
- Ensuring the safety of tenants’ homes, both under current pandemic conditions and in the longer term
- Evolving expectations about transparency and accountability and relationships with tenants
- Helping to meet the demand for new affordable homes in an uncertain economic environment
- Increased reliance on debt with a need for £41bn in new debt facilities over the next five years
Across all risks, RSH identifies that effective governance, including good risk management practices and the ability to make informed, transparent decisions about strategic priorities and trade-offs are vital to navigating uncertainties.
The annual publication of the Sector Risk Profile aims to inform registered providers’ understanding of the wider economic and operating environment.
The RSH says it is “vital reading” for boards in considering how they manage the range of strategic and operational risks they face.
Fiona MacGregor, chief executive of RSH, said: “The social housing sector’s response to the immediate financial and operational impacts of the Coronavirus pandemic has demonstrated providers’ preparedness for unexpected shocks.
“However, as our Sector Risk Profile sets out, the outlook remains unusually uncertain in the sector, the wider economy and society.
“Social housing providers must continue to identify, manage and mitigate the range of risks they face and be transparent and accountable for the strategic choices and decisions they must make.”
The Regulator’s role
The RSH aims promotes a viable, efficient, and well-governed social housing sector able to deliver homes that meet a range of needs.
It does this by undertaking robust economic regulation focusing on governance, financial viability, and value for money that maintains lender confidence and protects the taxpayer.
It also sets consumer standards, and may take action if these standards are breached and there is a significant risk of serious detriment to tenants or potential tenants.
Image credit: ZGPhotography/Shutterstock
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