South Yorkshire Housing Association was founded In 1972 after SYHA’s founder John Belcher watched the BBC drama Cathy Come Home, it began with a small housing association helping homeless families in Sheffield. The organisation grew into South Yorkshire Housing Association, and over forty years later they are still providing high-quality, affordable, well-designed homes: retrofitting, renovating, and creating homes throughout South Yorkshire. South Yorkshire Housing Association won Landlord of the Year at the 2021 UK Housing Awards. South Yorkshire Housing Association manage over 6,000 homes across South Yorkshire, but their work is more than housing. South Yorkshire Housing Association work with people to settle, live well and flourish in their homes and community, by providing employment, wellbeing and support services and opportunities.
RSH Narrative Regulatory Judgement
Provider: South Yorkshire Housing Association Limited
Regulatory code: L0078
Publication date: 28 September 2022
Governance grade: G2
Viability grade: V2
Reason for publication: Governance downgrade
Regulatory route: In Depth Assessment
Regulatory judgement
This judgement downgrades our assessment of South Yorkshire Housing Association Limited’s governance from G1 to G2 and confirms its existing V2 grade for viability.
South Yorkshire Housing Association Limited (SYHA) continues to meet the requirements on governance set out in the Governance and Financial Viability Standard. However, following an In Depth Assessment (IDA) we have concluded that it needs to improve aspects of its governance arrangements to ensure continued compliance.
The IDA has found weaknesses in the board’s oversight of risk management, strategic and financial planning, and strategic plan delivery.
Detailed monitoring of landlord health and safety and building safety risks is in place at officer level however board reporting does not allow for adequate oversight and challenge. A previous significant issue was not escalated to the board, or the regulator, in a timely and effective way. SYHA had already planned to review its risk management framework, and this should consider clearer mapping of the level of assurance the board receives to risk prioritisation.
When approving the business plan the board has not had sufficient or timely information to fully consider alignment with its risk appetite and any potential impact on SYHA’s strategy. In the context of increasing pressures reducing SYHA’s financial resilience, the quality of stress testing and mitigation work needs strengthening. Since approving the current business plan SYHA has agreed a revised business planning timetable and is undertaking additional work on modelling and mitigations. The board needs to continue this work at pace to inform strategic decision-making.
Performance reporting covers only a limited range of targets, restricting the ability of the board and other stakeholders to assess strategic performance. The board is focused on the successful delivery of SYHA’s strategy however it cannot fully evidence delivery of priorities.
The board has a reasonable range of skills and experience aligned to the services it delivers. However, SYHA needs to assure itself that board composition is appropriate in the context of current and future financial challenges. There is insufficient evidence that structured board skills appraisal informs recruitment and succession planning. There has not been an external board effectiveness review for several years.
The regulator has assurance that SYHA complies with the financial viability elements of the Governance and Financial Viability Standard and that its financial plans are consistent with and support its financial strategy. SYHA has an adequately funded business plan, sufficient security in place and is forecast to meet its financial covenants in the latest business plan.
While SYHA has the financial capacity to deal with some exposures, it has material risks and needs to manage these to support continued compliance. For the short to medium term, SYHA’s business plan is forecasting limited financial capacity, with weak financial operating performance and continuing low headroom against its current interest cover covenant. During this period SYHA is reliant on some uncertain cashflows, such as fixed asset disposals, to support its financial performance and covenant headroom.
Other providers included in the judgement
Alliance Housing Association (South Yorkshire) Limited
About the provider
Origins
SYHA is a charitable community benefit society. Its principal activities are the management of housing and the provision of care and support services.
Registered Entities
There are two registered providers in the group. SYHA is the parent of the group and Alliance Housing Association (South Yorkshire) Limited which is a charitable community benefit society.
Unregistered Entities
There is one active and two dormant non-registered subsidiaries in the group:
SYHA Enterprises Limited’s primary activity is estate agent and letting services. It also undertakes purchase and resale activity, as well as a co-design consultancy service under the Co-Create brand.
Charter Housing Limited and South Yorkshire (Second) Housing Association Limited are both dormant.
Geographic Spread and Scale
The majority of SYHA’s 5,200 homes are in the South Yorkshire Mayoral Combined Authority region, with a small number of units in Selby, Mansfield, Wakefield, and High Peak.
Staffing and Turnover
At 31 March 2021 the group employed 546 full-time equivalent employees. Group turnover for the year to 31 March 2021 was £46.4m.
Development
SYHA plans to develop 111 units between the 2022/23 and 2024/25 financial years. This includes 47 Low Cost Home Ownership units. Development is part-funded through the Homes England Affordable Homes Programme and the Recycled Capital Grant Fund.
Housing Ombudsman