OVERVIEW AND SCRUTINY COMMITTEE

6 JUNE 2019

Report title: Homes for Lambeth Review

Wards: All

Portfolio: Cabinet Member for Planning, Investment & New Homes: Councillor Matthew Bennett

Report Authorised by: Emma Peters: Interim Strategic Director for Sustainable Growth and

Opportunity

Contact for enquiries: Sandra Roebuck, Director for Development, Planning & Housing Growth,

sroebuck@lambeth.gov.uk, 020 7926 2594

Report summary

Overview and Scrutiny Committee and Council Members requested an overview of Homes for Lambeth.

The report outlines the make-up of Homes for Lambeth and discusses current performance.

Finance summary

This report is to provide information to Overview and Scrutiny Committee and as such there is no direct

cost of preparing or implementing the recommendations within the report.

Recommendations

1. To note the information outlined in the report and make recommendations.

1. CONTEXT

1.1 Overview and Scrutiny and Council Members requested an overview of Homes for Lambeth.

2. PROPOSAL AND REASONS

Rationale

2.1 Like all London boroughs Lambeth faces a severe and serious housing crisis. Over 2,000 families,

including 5000 Lambeth children, are homeless and housed in temporary accommodation by the

Council. Over 28,000 people are on the waiting list for social housing; every week another 40-60

people join this list while only around 20 homes become available.

2.2 Despite investing £500m refurbishing council estates across the borough to our aspirational

Lambeth Housing Standard, government cuts to rents and in grants have left a shortfall in funding

to provide every tenanted family with a good quality home. To address the crisis in housing quality

and quantity the Council established an estate regeneration programme in 2012 to rebuild tenants’

homes to high modern standards and to build more homes for local families on the waiting list.

2.3 Lambeth’s Housing Commission recommended that rebuilding options needed to be identified for

the six estates where refurbishment would be uneconomic and/or it would not overcome the

problems caused by poor design, and/or the opportunity exists to create more social housing

alongside better homes for existing tenants and leaseholders.

2.4 A number of options for tackling these challenges were considered: a development agreement and

sale of land to private developer; a Joint Venture partnership with private developer; a PFI

partnership with a private provider; stock transfer of estates to housing association; a Joint Venture

partnership with housing association, and a Wholly Owned development company.

2.5 The Council ruled out partnering with a private developer or a housing association to deliver these

homes, and in May 2017 100% council-owned, council-controlled company, Homes for Lambeth,

was selected as the preferred option to build and manage a new generation of social housing for

Lambeth families. Homes for Lambeth will be able to bring in expertise from the private and public

sectors to deliver housing in a more commercial and efficient way, while nonetheless provided

maximum ongoing control by the council. HfL has to deliver a business plan which will be set

annually by Cabinet, and. Cabinet oversees the performance of the company through the Overview

and Stewardship Panel, holding the company’s board to account and ensuring that the company

delivers against the priority outcomes set by the Council. Moreover, HfL has the potential in future

to access funding sources not otherwise available to the Council.

2.6 More information on the rationale for Homes for Lambeth can be found in the following Cabinet

papers:

October 2015

May 2017

Other WOCs

2.7 In recent years, a number of local authorities across the UK have set up “wholly owned” housing

delivery or land development companies. In London, research undertaken by the Centre for

London indicated that 22 of the 32 London boroughs and the City of London Corporation have set

up such companies.

2.8 The objectives for these companies vary from Council to Council. Whilst some are positioned as

purely commercial vehicles intended on creating an additional revenue stream for the Council,

others have utilised these companies specifically to increase the delivery of affordable housing,

and/or use companies as a vehicle for additional General Fund borrowing to supplement delivery

where HRA borrowing capacity has been limited.

2.9 The potential for development also varies from Council to Council and from vehicle to vehicle

depending on how much land an authority owns, and its scope for making funding available. For

some the homes proposed to be delivered by the WOCs constitute a significant percentage

contribution to overall housing delivery targets. Lambeth does not have the available land to do

this, but HfL is much targeted in that it is focusing more strongly on delivering social rented homes,

rather than intermediate and/or private rented homes.

2.10 Housing delivery companies, as with all delivery mechanisms, are required to prioritise their

ambitions and balance the need for affordable housing with commercial considerations.

Companies have to comply with state aid regulations and will structure companies so as to be tax

efficient, therefore it is sensible that an Affordable Housing company is created separate from the

main development company so as to benefit from VAT exemptions related to the provision of

Affordable Housing. Working capital has to be provided, and costs incurred in the “set up” phase

have to be recovered over time. It is generally several years before any income is received; this

has to be planned for in financial terms.

2.11 Where companies are focusing on development of new homes (of any tenure) the pay-back period

is likely to be longer than where they are buying existing stock or trading in land, simply because

developing a significant volume of new homes cannot be done quickly. This is particularly the case

where estate renewal is involved because the land assembly process (buying out leaseholders etc)

is both expensive and time consuming.

2.12 Some examples of different approaches to Wholly Owned Companies are as follows:

2.13 LB Barking and Dagenham – Barking and Dagenham set up BeFirst and Reside in 2017 to deliver

new mixed tenure homes, to achieve an “attractive” return on Council investment and to drive up

development values in the borough. BeFirst is a service delivery company and has taken over a

number of planning, regeneration and delivery functions of the Council, with staff TUPE transferred

to the company. It does not own land or assets that it develops. It is dependent upon the Council

to finance debt, as it does not own collateral to seek third party debt financing, and thus is likely to

continue to be restricted to operating as a service company. Be First’s overheads and

management costs are financed by selling the services to the Council, with the aim that Be First

should break even. It was originally financed with a working capital loan, and the initial set up costs

absorbed by the Council (e.g. legal costs and costs of recruiting). BeFirst has a board with a

remunerated independent chair and remunerated non executive and executive directors. There is

a shareholder committee, which reports to the Council’s Cabinet. A five year rolling Business Plan

is submitted to the Shareholder Committee and then to Cabinet. Reside, which is entirely separate

wholly owned company, exists as a financial entity with a number of sub companies (affordable

homes, market rented homes, shared ownership homes), to hold the assets generated.

2.14 LB Bexley – Bexley has a very different model. Bexleyco has been set up as an investment,

development & management company that quickly delivers a portfolio of housing and other assets,

to support the Council’s growth and regeneration strategies. Its primary function is to drive

commercial profit. As a result, the company is structured as an equity and debt establishment. All

land goes into the company as equity from the Council, whilst senior debt is secured from the

Council at 5.5%. Return to the Council is comprised of profit from the Company’s activities and

interest margin on the differential between borrowing and lending rates. It has a shareholder

Board which has been allocated the functions of contract manager, shareholder and s.151

oversight as lender to the company. This shareholder group consists of both officers and members

and reports formally to the Cabinet. The company board comprises Council officers at an Assistant

Director level. The Managing Director is the sole core employee, with all other employees

externally contracted or seconded from the Council.

2.15 LB Croydon – Croydon Council’s Wholly Owned Company is Brick by Brick (BXB). It is a private,

independent development company, commercial in character, which focuses on providing housing

led development for the benefit of the people of Croydon. BXB was set up particularly to address a

perceived lack of quality from third party providers. Its function is to deliver multi-tenure housing

for sale and rent, to ensure a transparent and commercially efficient form of development which

maximises the amount of affordable and intermediate housing and to deliver new commercial

and/or retail development. It is required to carry out all of the above activities on a commercial

basis and in the best interests of the company with a view to maximising dividend to the Council as

sole shareholder. All land goes into the company as equity from the Council, whilst senior debt is

secured from the Council at a competitive blended rate. Return to the Council is comprised of profit

from the Company’s activities and interest margin on the differential between borrowing and

lending rates. The Brick by Brick board has been set up with two non-executive directors, one

Council officer and two Brick by Brick officers. It is chaired by one of the non-executive directors,

who is both independent and experienced. Brick by Brick reports to Council via the Investment

Board and the Corporate Management team. Brick by Brick initially targeted a lean resource model

and was set up using staff seconded from the Council, supplemented by external resources where

appropriate. Uniquely, they also established a dedicated architecture and design team to develop

best practice around densification in both urban and suburban areas of the borough. The

seconded staff, the new architecture and design capacity, and the Council’s internal development

and delivery team were TUPE’d to Brick by Brick with effect from the 1st October 2018. The

Council is now reviewing its client side capacity. It should be noted that a relatively a slow start, in

comparison with initial business plan projections, is a common theme of most of the wholly owned

companies. Moreover, many have undertaken early business plan reviews, and early reviews of

either the company structure, and/or board composition and/or client function. This is to be

expected in undertaking a delivery and development function where all Councils lack recent

experience, and where there are fluctuations in market conditions and in central and regional

government policy on housing targets, grant regimes and borrowing regimes.

HRA Borrowing Cap

2.16 A report on the impact of the removal of the HRA borrowing cap was presented to Scrutiny

Committee in December 2018, the position is unchanged from that point of time and the crucial

issue remains affordability of borrowing not availability of borrowing.

2.17 With respect to Homes for Lambeth, the lifting of the borrowing cap means that borrowing to fund

Homes for Lambeth could technically be made from the Housing Revenue Account in future rather

than from the General Fund. However, as the General Fund is larger it is more able to bear risk

and cope with the timing difference related to Estate Regeneration as spend is generally many

years ahead of the related repayment.

2.18 It would not be viable to fund a wholescale refurbishment (to Lambeth standards) of existing

estates from the Housing Revenue Account. Although the Housing Revenue Account could borrow

to fund refurbishment work, it would not be able to repay this borrowing, as refurbishment would

not lead to any increase in the total rental income receivable within the HRA. Estate Regeneration

increases the number of housing units which provides new income sources to fund borrowing.

Board Structure

2.19 This is set out in the Cabinet Report of 22/01/18 ‘Homes for Lambeth Business Plan (January 2018

to March 2019)’ at paragraph 2.22. The interaction between the Council and the Companies is set

out in the Memorandum of Understanding which was Appendix B to that report as varied by the

CMDR of 20/11/18 ‘Changes to Homes for Lambeth Memorandum of Understanding and the

Articles for HFL Homes Ltd’.

2.20 The hierarchy of the company structure is set out below:

2.21 It is the purpose of these boards to work towards the delivery of Homes for Lambeth’s Business

Plan as well as providing the wider necessary corporate governance for the company.

2.22 The Council can appoint board members to HFL Group Ltd and the then board membership was

set out in paragraphs 2.25 to 2.30 of the Cabinet Report of 22/01/2018, although currently the

Council nominees to the various boards is under review due to Council staffing and structure

changes. In addition there are a number of Non-executive Directors appointed to each company as

set out in the Cabinet Report of May 2017 ‘Incorporating and Mobilising Homes for Lambeth’ at

paragraphs 2.8 to 2.11. There has recently been a refresh of the NEDs on the HfL Group.

2.23 ‘HFL Living Ltd’ is a Private Rented Sector (‘PRS’) housing company that has been created to

allow new PRS housing to be acquired from HFL Build in the longer-term. At present the company

is effectively inactive as initially the Homes for Lambeth group is largely debt financed and it has

been calculated that it is more prudent to pay down this debt more quickly through market sale of

non-affordable housing in the early years of operation. This position is subject to ongoing review

There is a board structure, with both Directors and NEDs appointed to it, so it can mobilise quickly

if required. It is private company limited by shares, of which 100% of the shares are held by HFL

Group.

Company Culture

2.24 As a council own company, the values of the council are be very much at the centre of Homes for

Lambeth. At the heart of this is the company’s social purpose, it has been set up to maximise the

delivery of affordable (social) rented homes on council owned land, and to recycle any profits from

the development process back into further affordable (social) rented homes.

2.25 As well as these council values it is developing its own culture by combining the council values it

has inherited with the industry knowledge and experiences of those new team members who have

come from outside of the council. The development of an HfL culture is work in progress; the new

board and the new recruits are bringing speed, flexibility and efficiency and the Council, as

shareholder and client, is ensuring that social value principles are fully reflected in the business

planning and delivery processes. For example, HfL uses LBL procurement systems and

processes and the social value requirements of those processes are therefore fully reflected.

2.26 As a company, Homes for Lambeth has been creating all of the necessary HR and financial

policies required to support its operation:

Data Protection Policy

Group Complaints Policy

Group Equality and Diversity Policy

Group Resident Engagement Policy

Group Tenancy Audit Policy

Homes Allocations Policy

Homes ASB Policy

Homes Equality and Diversity Policy

Homes Repairs Policy

Homes Tenancy Policy

Homes Voids Policy

Mutual Exchange Policy

Neighbourhood Policy

Social Rent Setting Policy

Business Plan

2.27 The expectation is that future business plans will be for a minimum of 3 years. At the time of the

preparation of the existing business plan the Homes for Lambeth management team were newly in

post and therefore concentrated on the more immediate projects and activity in preparing the

business plan.

2.28 Funding of Homes for Lambeth will be for 3 main elements of work:

Working Capital Loan – To pay for staff and general running costs

Development Loans – To pay for development activity on sites that have planning permission and

where land has transferred to Homes for Lambeth. The diagram below shows how loan funding

works between the Council and the Homes for Lambeth companies.

Commissioned Works – These relate to sites and estates that do not yet have planning

permission and where the Council needs more work to take place to evaluate options for the

sites, work up detailed designs etc but does not have the capacity to do this work internally. In

these cases, the funding will not be a loan but a payment for services provided, in the same way

any other external company would be paid. The Council need to firstly determine what works

they require and then agree a price with Homes for Lambeth, only then can work commence

2.29 From a Homes for Lambeth point of view they are only allowed to undertake activity that is

included within their business plan for the year, because of this the Business Plan inevitably

includes the best case scenario of what might be commissioned from them and the reality might be

much less. Thus the £9.1m identified for feasibility work is the maximum level, in practice there will

be a number of smaller commissions for different stages of work on Somerleyton Road,

Cressingham Gardens, Central Hill and Fenwick estates.

2.30 The diagram below shows expected cash flows between the Council and HFL and within HFL.

When the council lends money to an external organisation it has to be aware of State Aid

requirements. This means that a higher ‘market’ rate of interest has to be charged to the

development company which will sell housing in the open market and is therefore deemed to be in

competition with the private sector. The affordable housing company can borrow from the Council

at a lower rate as it is only involved providing services for the public good and thus effective

subsidy via a lower interest rate is allowable

Client Relationship

2.31 The Council is the client for Homes for Lambeth. The client function is structured around the

adopted business plan and a commissioning framework. The principles on an operational basis are

as follows:

2.32 Work will be commissioned by LBL from HfL through the structure of responsibilities shown below.

The ‘Client’ function of the Council will define the strategic context for HfL’s Delivery Programme

(the ‘Delivery Programme’), including strategies, budget and regulatory/legal requirements and will

specify the outcomes and outputs that are required to be delivered by HfL.

£8m equity £5m working capital @ 6%

Dev elopment facility (£150m) @ 6% Inv estment facilities @ 3.2%

HFL Group

Lambeth Council

HFL Build

Inter co working capital

HFL Homes

Strategic direction/ vision/rationale

Strategies

Budget/Funding

Financial control

Design authority

Monitoring & reporting

Delivery of commissioned work

Political interface

Commissioning

Regulatory compliance

Programme management and control

Developer interface

Delivery plans

HfLLBL CLIENT

Project definition/initiation

Project management and control

Programme definition (joint) Programme definition (joint)

2.33 This commissioning model means the Client focuses on the Council’s desired outcomes

throughout any commissioning activity. Attention and resources in HfL are therefore focused on

those activities that are required to deliver the Council’s objectives and desired outcomes.

2.34 As a result, HfL has a clear mandate which contains the expected outcomes, performance

measures and targets, areas of priority, information on key developments and details of resources.

Delivery performance against the requirements expressed in this Mandate will form part of the

Council’s formal arrangements for monitoring the performance of the Delivery Programme.

2.35 Figure 2: ‘Golden Thread’ from Corporate Strategies to Delivery Plans

2.36 This ‘Golden Thread’ from Corporate priorities to delivery plans is shown in Figure 2 above. It is

the Council’s expectation that the LBL Client and HfL Delivery organisations will work together to

continuously improve and transform operations to reduce costs and improve performance. This

approach will use formal governance arrangements and professional relationships between the

Client and HfL to realise the vision.

2.37 The overriding purpose of the Council’s commissioning function is to help define and orchestrate

the delivery of housing outcomes for the borough by marshalling resources and commissioning

activities around this ‘Golden Thread’.

Corporate Plan

Strategic Context

Commissioning Mandates

HfL Business Plan

Delivery Plans and Outcomes

2.38 Figure 3: Mandate Structure

2.39 The commissioning framework or mandate, when complete will comprise the following five

sections.

2.40 Mandate Overview

Illustrates core details such as the duration, ownership and review cycle of the Mandate. Contains

a profile of the Commissioners of the service and arrangements for governance and change

control.

2.41 Purpose and Objectives

Summarises the purpose that HfL was established to fulfil, and the outcomes and objectives for the

service. It also outlines the framework of Corporate and Divisional strategies and plans within

which HfL is expected to operate (such as the Corporate Plan, Housing Strategy, Procurement

Strategy). In future iterations of the Mandate this will may change to reflect a shared vision

between the service and the commissioner.

2.42 Operating Framework

Provides the process of commissioning and the parameters within which HfL is expected to

operate and deliver the outcomes and outputs required by LBL. These parameters include the

Legal Framework and Service Standards.

2.43 Financial Envelope

Gives details of the financial envelope within which HfL will operate together with how these will be

reported and monitored.

2.44 Reporting and Monitoring

Outlines the key performance indicators on which HfL will report to LBL, and against which it will be

monitored. These include indicators to measure delivery of outcomes and accordance with the

operating framework. Also describes the arrangements for monitoring.

Purpose and

Objectives

Reporting &

Monitoring

Financial Envelope

Operating Framework

The rationale for HfL and what the

benefits and success criteria look like.

The KPIs and other performance indicators against which HfL will

be monitored

The legislative and standards

framework that HfL must deliver

outcomes within.

The funding and other financial

parameters within which HfL is

expected to operate

2.45 There will be commissioning brief for each work package/project that defines the scope, functional

requirements, budget timescales and performance standards that will form the basis of task orders

to be issued to HfL to execute the work. Further Commissioning Briefs will be added as and when

additional work packages and commissions are identified.

Programme Length

2.46 It is expected that when fully mobilised HFL will be delivering an annual programme of outcomes

and new homes for the duration of its lifetime.

2.47 On the current programmes in relation to the estates that already have planning permission, it is

expected that construction will be completed by:

Knights Walk (Phase 1) – 2021

South Lambeth (Phase 1) – 2022

Westbury (Phase 1) – 2020

Somerleyton Road (Phase 1) - 2020

2.48 In relation to Cressingham, Fenwick and Central Hill, Homes for Lambeth is undertaking feasibility

studies to reaffirm programmes of delivery.

2.49 In addition, HFL is reviewing a series of smaller sites throughout the Borough The list of sites will

be published as and when the feasibility studies are complete. The outcome of the review will

enable the delivery path of those sites to be confirmed.

Audit and Scrutiny

2.50 As a private company, Homes for Lambeth is required to appoint its own auditors. The

Memorandum of Understanding between the Council and the companies requires the Council’s

Corporate Committee to be consulted in relation to the appointment of HFL’s auditors.

2.51 Members of the Overview & Scrutiny Committee are referred to the Cabinet Report of 22/01/18

‘Homes for Lambeth Business Plan (January 2018 to March 2019)‘ and the CMDR of 20/11/18

‘Changes to Homes for Lambeth Memorandum of Understanding and the Articles for HFL Homes

Ltd’.

2.52 The reports agreed the Memorandum of Understanding, and subsequently a variation to it, setting

out the relationship between the Council and the HFL companies, with a scheme of delegation set

out at Schedule Seven. A copy of the amended scheme of delegation is attached for ease of

reference here.

2.53 The Ownership & Stewardship Cabinet Advisory Panel oversees the internal reporting, scrutiny,

monitoring and accountability of the HFL Group, on behalf of the Council. The terms of reference

for the Ownership & Stewardship Cabinet Advisory Panel is set out in Schedule Four to the

Memorandum of Understanding which is attached for ease of reference here.

2.54 The purpose, membership, and working arrangements for this panel are dealt with at pages 49 &

50 of the Council’s current constitution.

2.55 Finally, HFL Homes Ltd. is a registered provider and therefore will also be accountable to the

Regulator of Social Housing.

KPIs and Key Deliverables

2.56 Homes for Lambeth has set out in its business plan its objectives for 2019/20 and these have been

summarised in the company’s plan on page – see below:

2.57 Over the year the Homes for Lambeth boards will monitor the progress of the companies towards

these goals. At the end of the year Homes for Lambeth will report on it progress to the Ownership

and Stewardship Panel in its next business plan.

2.58 As Homes for Lambeth takes on more commissions from the council a wider set of KPIs will be

developed.

Land Transfer

2.59 Once a Phase of an Estate Regeneration project has both planning permission and the Council

has achieved vacant possession of the relevant land, then Homes for Lambeth can ask for the land

to be transferred to them in order to begin development.

2.60 At this point the Council would need to ensure various documentation is in place;

The Council has reviewed the financial model to determine that the scheme is viable in line with

the criteria given to Homes for Lambeth, namely that 10% profit on cost is achievable.

That Homes for Lambeth have a project plan demonstrating they are able to proceed with

development

That the land has been valued and that Homes for Lambeth are able to pay the market value

identified by this valuation.

2.61 In practice, the land transfer will be via a long lease with the Council retaining ownership of the

freehold of the property, the lease will determine what Homes for Lambeth are able to do with the

land and will restrict them to implementing the scheme that has secured planning consent. If

Homes for Lambeth do not implement the scheme, then the land would revert to the Council. The

lease also means that the land value is likely to be relatively low, as it will require the level of

affordable housing prescribed within the planning application to be delivered.

2.62 Once this information is available the land transfer can be made by way of a Cabinet Member

Delegated Decision report authorising the disposal.

2.63 The main difference from a stock transfer is that the land is being transferred without any secure

tenants in place and hence no ballot is required.

3. FINANCE

3.1 The cost of preparing this report has been contained within existing budgets and as the report is for

information purposes there are no explicit recommendations that have a further cost implication. If

Scrutiny committee make further recommendations as a result of this report, the cost of implementing

these recommendations would need to be assessed before work could be undertaken.

4. LEGAL AND DEMOCRACY

4.1 Article 1 of The First Protocol of the Human Rights Act 1998 provides that every person is entitled to

the peaceful enjoyment of their possessions and that no one shall be deprived of their possessions

except in the public interest and subject to the conditions provided for by law and by the general

principles of international law. These provisions do not impair the rights of the state to enforce such

laws as it deems necessary to control the use of property in accordance with the general interest or

to secure the payment of taxes or other contributions or penalties.

4.2 Article 8 of the Human Rights Act gives everyone the right to respect for their private and family life,

their home and their correspondence. A public authority is not permitted to interfere with the exercise

of this right except such as is in accordance with the law and is necessary in a democratic society in

the interests of national security, public safety or the economic well-being of the country, for the

prevention of disorder or crime, for the protection of health or morals, or for the protection of the

rights and freedoms of others.

4.3 Section 149 of the Equality Act 2010 sets out the public sector equality duty replacing the previous

duties in relation to race, sex and disability and extending the duty to all the protected characteristics

i.e. race, sex, disability, age, sexual orientation, religion or belief, pregnancy or maternity, marriage

or civil partnership and gender reassignment. The public sector equality duty requires public

authorities to have due regard to the need to:

(a) Eliminate unlawful discrimination, harassment and victimisation and other conduct prohibited

under that act

(b) Advance equality of opportunity between persons who share a relevant protected

characteristic and those who do not share it; and

(c) Foster good relations between those who share a protected characteristic and those who do

not share it, which involves having due regard, in particular, to the need to—

(i) tackle prejudice, and

(ii) promote understanding.

4.4 Having due regard to the need to advance equality of opportunity between persons who share a

relevant protected characteristic and persons who do not share it involves having due regard, in

particular, to the need to—

(a) remove or minimise disadvantages suffered by persons who share a relevant protected

characteristic that are connected to that characteristic;

(b) take steps to meet the needs of persons who share a relevant protected characteristic that are

different from the needs of persons who do not share it, including, in particular, steps to take

account of disabled persons' disabilities;

(c) encourage persons who share a relevant protected characteristic to participate in public life or

in any other activity in which participation by such persons is disproportionately low.

4.5 Compliance with the duties in section 149 of the Act may involve treating some persons more

favourably than others; but that is not to be taken as permitting conduct that would otherwise be

prohibited by or under the Act.

4.6 The Equality Duty must be complied with before and at the time that a particular policy is under

consideration or decision is taken - that is, in the development of policy options, and in making a final

decision. A public body cannot satisfy the Equality Duty by justifying a decision after it has been

taken.

5. CONSULTATION AND CO-PRODUCTION

5.1 Consultation and coproduction with residents and the wider community is central to the

development of individual regeneration schemes and officers from HfL team continue to work

closely with residents and communities to support them through the process, ensure they have a

say in the look and feel of their new homes, and help them to understand what Homes for Lambeth

is, and what it means for them.

5.2 Consultation and coproduction have, and will continue, to play a key role in the development of key

Homes for Lambeth outputs and policies, including the Key Guarantees (agreed by cabinet in

March 2017).

5.3 Residents have already been consulted on the tenancies and leasehold agreements which Homes

for Lambeth will provide. The council, in its capacity as shareholder of Homes for Lambeth, will

require HFL Homes (the housing association) to use these new tenancies and leases for those

residents who are currently living on these regeneration estates and would be moving to a newly

built HFL home.

5.4 Residents of the regeneration estates have also been asked for their views on the specification of

service for future housing management arrangements. This specification will define what HfL for

expect from companies bidding to provide housing management services. The specification will

also determine the cost of these services.

5.5 It is intended that HfL will then shortlist suppliers who have shown they can meet this specification.

As estate redevelopment work nears completion, shortlisted bidders will be invited to talk to

residents at an exhibition and answer questions about managing their new estate. Residents will

score each supplier on their ability to meet the needs of the estate, and on their approach to estate

management. These scores, along with scores from a full tender process and an interview, will

decide which supplier is chosen

5.6 Officers within the council and HfL have and will continue to work with Members to further develop

the proposals set out in this report.

5.7 Local Ward Councillors will also be consulted at the point that a development site within their ward

is identified for development via HfL.

6. RISK MANAGEMENT

6.1 No specific risks relating directly to this report.

6.2 However, risks relating specifically to HfL can be found in the corporate risk register here.

7. EQUALITIES IMPACT ASSESSMENT

7.1 The Boards of the Homes for Lambeth companies will adopt a suite of policies that guide how they

will carry out their business. This suite of policies will include an Equalities policy reflecting the

principles included in the Council’s policy.

7.2 The impact of estate regeneration will be different for each project at different times and therefore

Equalities Impact Assessments are required on a project basis and reviewed at regular intervals.

No specific equalities impact assessment has been carried out to date inform this Cabinet Report

as these are being carried out at a project by project level. However, this is currently under review

and it is likely that a programme wide assessment will be undertaken as part of the preparation of

the (minimum 3 year) business plan for 2020 onwards.

7.3 In progressing estate regeneration projects, Homes for Lambeth will abide by the Council’s

approach to equalities, which are embedded in the Future Lambeth Borough Plan. The principles

that will be followed by the Housing Regeneration team will be:

7.4 Information. Any equalities strategy for an estate regeneration project is only as good as the

information it is based on. It is therefore essential to collect adequate information concerning those

affected by estate regeneration and to maintain such information up-to-date. This is undertaken

through the course of estate regeneration projects by means of activities such as housing needs

assessments, which are carried out for all affected households.

7.5 Training. Equalities principles must be embedded in all minor decision-making throughout an

estate regeneration project. This requires that those working on estates projects are continually

mindful of equalities issues and have access to adequate training to ensure that they embrace

such principles in their day-to-day work.

7.6 Assessment. Formal equalities impacts need to be carried out to inform any major decisions or

commitments on the future of an estate. For a typical estate regeneration project, equalities impact

assessments are required at the following stages:

Feasibility Stage – to help inform whether or what part of an estate will be redeveloped – an

Equalities Impact Assessment accompanies the Cabinet Decision on the scale of

redevelopment for an estate;

Masterplanning and Local Lettings Plan Stage – to help inform the design work and to ensure

that the replacement homes adequately cater for the existing community of residents, whose

homes are being demolished – an Equalities Impact Assessment then accompanies any

Cabinet Report that seeks authorisation for a compulsory purchase order; and

Allocations – to help inform the allocations process to ensure that homes are allocated in a way

that conforms with equalities principles – once construction and decanting has commenced,

equalities reviews will be undertaken at pre-defined intervals specific to each estate.

7.7 New small site developments will have localised impacts on the immediate neighbourhood around

these projects. Any impacts on local residents will be identified and determined in the process of

working up designs for projects and preparing and submitting planning applications. The planning

process itself requires consultation with local residents and the council will work with local interests

as part of the design process. It is only through the process of such consultation that it will be

possible to identify what and whether there are any impacts and then deduce whether these raise

any equalities considerations. Community statement will be submitted with planning applications

and will address such matters

8. COMMUNITY SAFETY

8.1 Homes for Lambeth will contribute positively to community safety by ensuring that each scheme

delivered involves the removal of areas that attract anti-social behaviour and providing more

passive surveillance of streets and spaces. The wider regeneration initiatives will promote estate

pride and actively design out the potential for crime as part of the development process.

8.2 As outlined above, Homes for Lambeth will also contribute towards the delivery of safer and

stronger communities. The provision of safe, high quality housing, committed to in the Homes for

Lambeth design principles, is recognised to make a positive contribution to the improved wellbeing

of residents. Therefore, by increasing the provision of accessible housing, Homes for Lambeth will

directly support Lambeth’s communities to become safer and stronger. The Council will lead the

stakeholder engagement for each scheme and will ensure that residents have both an active

involvement and influence over how each new development is planned and operated.

9. ORGANISATIONAL IMPLICATIONS

Environmental

9.1 Environmental sustainability will be a key consideration for any proposed interventions and the

Council will seek the highest possible standards with the resources available.

Staffing and accommodation

9.2 New staffing structures have been set up within Homes for Lambeth and are in the process of being

finalized, with a series of appropriately qualified external appointments and some council seconded

staff. The governance proposals Homes for Lambeth has created new, un-remunerated directorship

roles for Council officers with an appropriate level of support provided to assist officers in these new

roles. Seven remunerated roles for Non-Executive Directors have also been be created and a

remunerated Chair, who is also a Non-Executive Director.

Procurement

9.3 Due to the level of control exercised by Lambeth Council over the Homes for Lambeth Group, the

wholly owned companies will be classed as ‘Contracting Authorities’ for procurement. This means

that they will follow the Public Contracts Regulations 2015.

9.4 There are no immediate procurement considerations arising from this report. Direct engagement

with procurement officers is taking place to support the formation and mobilisation of Homes for

Lambeth and to ensure that suitably robust and legally compliant procurement policies and

practices are put in place to guide the activities of Homes for Lambeth.

Health

9.5 The delivery of additional safe, warm and affordable new homes across a range of tenures, together

with the delivery of safer and stronger communities that are designed with and for Lambeth’s

communities will directly support the health and wellbeing of residents. The Lambeth Health and

Wellbeing Strategy (2016) identifies having a good home as an important factor in preventing ill

health and poor wellbeing. Homes for Lambeth will also make investments to generate income for

the General Fund that will support the Council to sustain the delivery of vital services that residents

need in the face of sustained Central Government cuts. The Council’s Social Value principles are

also embedded within Homes for Lambeth’s approach, which will result in new economic and

learning opportunities for residents.

10. TIMETABLE FOR IMPLEMENTATION

10.1 N/A

AUDIT TRAIL

Consultation

Name/Position Lambeth directorate /

department or partner Date Sent

Date

Received

Comments in

paragraph:

Emma Peters, Interim

Strategic Director

Sustainable Growth and

Opportunity 20.05.19 28.05.19 Throughout

Matthew Gaynor Finance and Investment 03.05.19 20.05.19 3.1

Cllr Matthew Bennett Cabinet Member for Planning,

Investment and New Homes 20.05.19 28.05.19 Throughout

Gregory Carson, Legal

Services Legal and Governance 01.05.19 02.05.19 4.1-4.6

Gary O’Key, Democratic

Services Legal and Governance 29.05.19 29.05.19

REPORT HISTORY

Original discussion with Cabinet Member

Report deadline 24.05.19

Date final report sent 29.05.19

Part II Exempt from Disclosure/confidential

accompanying report? No

Key decision report No

Date first appeared on forward plan N/A

Key decision reasons

N/A

Background information

October 2015 Cabinet report

May 2017 Cabinet report