Agenda item

Committee received an update on the successful reintegration of street property homes managed by Partners into Council Services from Hannah Bowman, Assistant Director Strategic Planning & Investment. The following points were highlighted:

On 4 April 2023 the c. 2800 tenanted homes and 1200 leasehold homes returned to council management at the end of the council’s 16-year Housing Private Finance Initiative (PFI) 2 contract with Partners for Improvement in Islington (Partners).

27 staff joined the council from Partners as part of a TUPE transfer to continue to deliver the services to council residents.

The transition was a culmination of a three and a half year programme of work, by the council and Partners, overseen by a multi service Programme Board within the council, to deliver a smooth and successful transition of service from Partners to the council.

Members were reminded that the committee provided recommendations for improvements to the programme and that a year on from the reintegration the briefing before committee reflects how the homes have been reintegrated into Council service delivery highlights continued plans to ensure services are fully integrated into service improvement plans by the council.

The meeting was informed that a range of performance indicators were identified to help review the impact on the council services of the reintegration of PFI 2 homes, so that the housing services key landlord contact points were a key, that the repairs service was a key area for review as street properties have a range of characteristics that are different from Council estate stock and pose different challenges in service delivery.

Although there have been areas of more significant impact, overall the additional properties have not resulted in high levels of impact on services, demonstrating that service preparations have in general been successful and adequate.
 

Meeting was advised that call volumes at Housing Direct actually saw a fall when compared with the previous year for the first seven months of the year, that this drop was more pronounced following the first 2 months of the year, which may indicate a small but significant surge in repair reports or servicing enquiries during the initial two months of the integration. However, there does not appear to be an on-going and sustained pressure on the call centre as a result of the integration.

The Service has experienced a significant growth in work as a result of managing a large number of repairs jobs raised on PFI2 homes as they have returned to LBI to be managed, over 11,500 jobs this year. Overall, the total number of repairs jobs has increased between April 2022 and March 2023 including PFI 2 jobs, but the PFI 2 jobs have remained consistently around 11% of the total number of jobs, that this has been within a backdrop of increases in jobs being experienced in all stock. The service has reported that the cost and complexity of these jobs are higher than for the majority of stock.

In terms of gas repair jobs, the Assistant Director noted that the level of repair work for gas boilers peaked during the winter period,  that the number of gas repair jobs are generally above the 12% threshold throughout the year. The service has indicated that this is as a result of the gas boilers in PFI 2 homes nearing the end of their economic life because of the contract with Partners only included a single replacement programme for boilers as part of the decent homes works at the beginning of the contract. An above average increase in boiler replacements have been experienced during the year as a result of this, as well as a revised approach to boiler breakdowns to help better reduce the risk of damp and mould in homes.

The number of legal disrepair cases that were inherited from Partners skews the true picture otherwise represents new cases related to these homes, however, there are clearly higher levels of disrepair claims for these street properties, than the proportion of stock that they represent. The service has fed back that this reflects their general experience of prevalence in different property types. It had also been anticipated by the service that claims may come forward or be restarted because of the change in management being seen as an opportunity to raise issues directly with the council.

In terms of income, rents for street properties are generally higher than for estate properties and therefore the level of debt per home has been higher, because a single week's arrears would have a higher monetary value than for the equivalent sized estate properties. The level of debt is therefore not in line with the proportion of homes being monitored. Collection rates between Partners and the council on an annual basis have been maintained within a 1% variance, indicating that performance of both organisations has been broadly similar.

The proportion of enquiries received from former PFI2 residents is proportionate to the proportion of stock at 12%, however there are some particular areas where they feature particularly highly including ASB and noise related contacts, making contact by phone and contacts about mutual exchanges as figure 8 demonstrates.

On the issue of service charges meeting was advised that the way service charges are billed between the council and Partners is different, as Partners continue like many providers to bill leaseholders in April for the coming year, whilst the council does this from September to September for costs incurred April to April. This is an approach the council has found to be successful for their collection arrangements, however leaseholder income is a key contractual requirement for Partners and therefore their service has not been aligned to this approach so it be noted that this reflects the ‘gap’ in service charge billing experienced by the leaseholders returning from Partners.

Most Homeowners pay their service charge by monthly direct debit from September and therefore sums owned as a total bill reduced down each month from September to September in line with this repayment profile.

Homes returning from PFI 2 attract a lower annual services charge because they are street properties and do not receive and pay for services such as caretaking, estate services and concierge. Therefore, charge levels are well below the 12% of total services charges, that their volume of properties represent.

Complaint levels in general are in line or below the representative levels of stock, except for in the peak period in November and December reflected in both the repairs and housing operations complaints levels. This timing coincides with the peak of jobs and complaint about damp and mould, due to the local and national focus on this important issue.

Although complaints levels have not been unduly high for the returning stock, services and the complaints team has fed back that the complaints received have followed other service trends of being a bit more complicated in general, either because of the nature of the properties or being the reopening of old issues of dissatisfaction, where residents are hoping to get a different outcome from previous enquiries to Partners.

A single replacement of boilers in homes during the contract term means that many of the boilers replaced during the works period at the beginning of the contract, are now coming to the end of their expected life. This constraint impacts in a number of ways but effects are already being felt in terms of the boiler replacement capital budget, with significant addition resources being required this year as a result of the PFI homes being reintegrated. A peak was anticipated but this has been higher than expected.

The service has also experienced very high levels of expectation from leaseholders about the quality of repair, maintenance and investment the council can provide to them. This may be a reflection of the much higher property values among this leaseholder group and a limited appreciation of the financial constraints and restricted income under which social housing providers operate.

The transfer of staff from Partners to the service has been found to be beneficial for the tenancy services management team, they have brought with them familiarity with the residents and their issues, consistency for residents who were familiar with their assigned housing officers, as well as, considerable expertise in anti-social behaviour and neighbour nuisance.

The Tenancy Team are currently undergoing a restructure process for the whole service, which will help to address these issues and will benefit all residents by addressing other issues highlighted by residents, Members, our critical friend and partner organisations that will lead to service improvements.

With regard to the integration of staff, feedback from services has been that the transfer of staff, where this was close to a full contingent of staff coming into the council, has been a positive experience both for the staff transferring and the council. The council has really benefitted from the expertise and knowledge of staff, who understand the challenges and complexities of working in our street properties and bring experience of this to service delivery.

Within the repairs team, staff moved over earlier than expected and with substantial ease to the council’s terms and conditions, ensuring consistency across the service and that staff can benefit from the additional employment benefits offered to council employees.

Meeting was advised that learning from the process and what went well and could be done better can be applied to future transfers into the council and eventually for the integration of PFI 1 services in 2033.

Meeting was advised that data transfer overall has been a success, although challenging and resource consuming programme of work, which for housing services was run alongside business as usual in most cases, presented some significant time and resourcing pressures.

The Assistant Director noted that ultimately the delivery of data held into the council’s systems worked well and the historical data is fully accessible to the council from Partners records, either through business-as-usual systems or Sharepoint repositories.

It was also noted that Services have, however fed back some useful improvements they would like to see regarding the keeping of records, which the PFI Clienting Team will pick up in our improvement work with Partners senior management team.

Resident communications on the reintegration seems to have been relatively effective, although some residents did inevitably contact Partners after the transfer, these were not large in number and were quickly redirected to the right service. Some residents still make contact about the transfer with the Programme Manager, who still have his details from the letters that were sent out explaining the transfer arrangements in March 2022.

Generally, feedback received by the service teams has been positive about the return of services to the council. Residents are positive about being more closely linked to the council.

Leaseholder expectations continue to be very high and the satisfaction levels inherited from Partners were very low. They will have benefitted from the change in collection timings this year, which may be well received by some, but we are equally mindful that the loss of the £10k rolling 5-year cap (which was a government requirement for PFI schemes) is likely to be seen as a negative impact of the change by this group, as investment programmes on this stock begin. 

A number of engagement activities have been offered to returning residents to understand their experience and any issues related to coming back into direct management. Unfortunately take up has been generally low despite this.

The Assistant Director in summary advised that the transfer of services went relatively smoothly for residents, which was a key objective of the programme for integration, that some key learning points have been picked up, that consideration be given to areas of work which needs more resource applied or to be started earlier has been identified to inform future service transfers.

In addition to the above, meeting was advised that the working relationship with Partners, if anything has been strengthened through the reintegration work and the joint commitment to ending the contract well was an important component to the success of the work programme. 

The Chair welcomed the integration of Partner managed properties back in to the council ownership, that it is essential that information about the process be captured in quarterly reports going forward as it is important that performances are monitored. The Executive Member for Housing and Neighbourhood welcomed the suggestion.

RESOLVED:

That the update be noted

That the performances of the integration process be monitored by its reporting in quarterly reports.