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Why have a Value for Money Strategy?
Value for Money has always been a key consideration for Berneslai Homes and in both 2005 and 2009 the housing inspectorate concluded that this was an area of strength.
Obtaining the best outcomes for our customers, within available resources, is the key to achieving value for money 81% of our tenants currently tell us they are satisfied with the value for money they receive for their rent, an increase from 61% in 2005. Berneslai Homes embraces the VFM agenda and will strive for continuous improvement in this area.
Challenge Berneslai our tenant led scrutiny process has found that
- Berneslai Homes is a low cost high performing ALMO
- There are high levels of customer satisfaction across the service
- And there is a great track record of partnership working
This strategy brings together all of the VFM strands which run through everything we do and communicates clearly to all board members, customers, staff and other stakeholders of BH how we will achieve, manage and improve VFM.
What is Value for Money?
Value for money is about getting the maximum benefit from the available resources.
VFM is often described in terms of “the three E’s”- economy, efficiency and effectiveness.
- Economy – minimising the cost of resources for an activity (“doing things at the right price”)
- Efficiency- how much you get out in relation to what you put in (“doing things in the right way”)
- Effectiveness- the extent to which objectives are met (“doing the right things”)
Having the “right people” is also an important aspect of ensuring VFM and Berneslai homes aims to be an employer of choice with committed, skilled and empowered employees whose working environment is underpinned by modern employment practices.
Value for Money has been achieved when there is an optimum balance between economy, efficiency and effectiveness. That is, costs are low, productivity is high and outcomes are successful.
The relationship between the “three Es” is illustrated in the diagram below
*SOURCE: Value for Money within Housing – Supplementary Guidance, Audit Commission (October 2005)
Local Context
One Barnsley, the Local Strategic Partnership ( LSP ) brings together key partners in the public,private,voluntary and community sectors to align their efforts to improve wellbeing in Barnsley. The work of the LSP is overseen by the One Barnsley Board, and Berneslai Homes is a named member.
The priorities for One Barnsley are identified and delivered through two strategies, the Jobs and Business Growth Strategy and the Health and Wellbeing Strategy.
The shared vision for Barnsley is
“a successful, uniquely distinctive 21st century market town at the centre of a borough that offers prosperity and a high quality of life “.
This vision for the Borough is complemented by a vision to reflect the work and aspirations of the Council.
The Council’s Vision is:
“Enabling the improved wellbeing of individuals, families, communities and businesses in a healthy, safe and more prosperous Borough.”
The Council’s Priorities are:
•Growing the economy
•Changing the relationship between the council and the community
•Improving people’s potential and achievement
Berneslai Homes vision is “ A fresh approach, to people, homes and communities “ and we do this through our values of “ Great People, Great Place, Great Company “ . Our core business strands complement the Council’s priority issues of health, education, skills, cohesion, culture, safety and quality of life for the people of Barnsley. In addition, we have identified within our work programmes how we are a key player and contributor to the Council’s core priorities.
In order to translate our vision into reality we have set four strategic objectives for the company. These are:
- To deliver excellent Customer services
- To continue to deliver sustainable communities which are safe, healthy and attractive neighbourhoods which are accessible to all
- To actively contribute to and influence partnership working within Barnsley and the sub region
- To be a successful well managed company
The attainment of Value for Money is fundamental to the achievement of these objectives.
National Context
The changed emphasis of the current Government has brought about a transformationin the national setting in which the VFM strategy is being developed
- Localism
The Government aims to promote more accountability at local level rather than to central government with much less attention paid to central targets. Under the localism agenda, previous national performance frameworks and inspection regimes have,therefore,largely ended. The emphasis in the local authority housing sector is on co-regulation with tenants holding their landlords to account.
- National Standards
The Homes and Communities Agency (HCA) took responsibility for the regulation of social housing providers on 1 April 2012.Regulatory standards have been published which contain the outcomes that the HCA expects providers to achieve. The standards are classified as either ‘economic’ or ‘consumer’. The economic standards, of which VFM is one, do not apply to local authorities or ALMOs. Under the standard RSLs (Registered Social Landlords) will now have to prepare an annual VFM self assessment. We will monitor the self assessments as they develop to identify any best practice applicable to Berneslai Homes.
- Welfare Reform
The Government’s current austerity programme combined with radical changes to the Welfare Benefits system will place a substantial strain on the finances of social housing providers. In this environment Value for Money is both more important and more difficult to achieve.
Value for money aims & objectives
Berneslai Homes is committed to achieving the following Value for Money aims:-
- To provide cost effective services that give high levels of customer satisfaction
- To maximise resources available
Underpinning our VFM aims Berneslai Homes has the following objectives:-
- To improve VFM
- To have an effectively managed approach to VFM
- To promote ownership and awareness throughout the organisation, with customers and other partners/stakeholders
- To demonstrate VFM
Value for Money is embedded in everything we do and can be classified in terms of the 5Ps
- Planning
- Performance management
- Processes & Procedures
- Partnerships
- Procurement
Planning for the long term & Strategy
To ensure we are effective and ‘doing the right things’ it is essential to have robust strategies and long term plans
Customer Involvement Agreement
We believe that the best way of improving services is to work closely with our customers. To listen and act on what they have to say about the services we offer. We believe that our customers and their communities should be at the heart of everything we do.
We encourage our customers to play an active role in the management of their homes and estates. Their involvement is critical in the planning, delivery and monitoring of the services that affect them to ensure value for money is secured. Our Customer Involvement Agreement, which was agreed in April 2012 is regarded by TPAS (Tenant Participatory and Advisory Service) as Good Practice, sets out how we are working to achieve this including:-
- Agreed service standards
- A clear framework for involving and engaging tenants
- Learning from complaints
- A wide range of methods for involvement
- Support from the Community Engagement Team
- Service Excellence Programme
The agreement is being reviewed during 2014/15 and will be relaunched in the Spring of 2015.
Our local Tenants Federation led scrutiny process, ChallengeBerneslai, continues to be an effective and tenant led way of ensuring continued excellence and service improvement. receiving national recognition due to the genuine independence of the process.
Our Annual Report to tenants, which is co-produced with tenants, ensures that our customers receive a fair and balanced assessment of our performance along with details of our plans on how we intend to get better. And for the first time in 2013, it was produced as a film version, which saved money, delivered important information in a more customer friendly way and received very positive feedback from customers.
HRA Business Plan
From April 2012 the subsidy system ceased and the Council now keepsthe entire income stream from their own rents which, after funding the debt charges on borrowing, is available to provide services and maintain the stock.
There is a viable 30 Year HRA Business Plan in place which means we can maintain the Barnsley Homes Standard and current levels of service.
Sustainable Asset Management
We have a well developed approach to area profiling and option appraisal to ensure investment is only made in sustainable estates.
Delivery Plan
The Berneslai Homes Delivery Plan sets a clear direction and set of objectives for the Company, which is essential to the achievement of VFM. By analysing our business strengths and weaknesses and our performance against a range of performance indicators and benchmarking information the plan documents our achievements to date. This understanding of where we are now is then used to set challenging but achievable targets for the following years and improvement actions.
HR strategy
The HR Strategy is Berneslai Home’s statement of how we will achieve our business objectives through our people. The strategy reflects the importance of effective Human Resource Management in achieving organisational goals. Ensuring a steady stream of committed, skilled and empowered employees whose working environment is underpinned by modern employment practices is essential in supporting our ability to provide cost effective and efficient customer focused services. The achievement of the Investors in People Gold award in 2014 and improving performance, now being listed at number 66, in the Top 100 Sunday Times Best Companies (Not for profit organisations) are a testament to this.
ICT strategy
The ICT strategy sets out the company's vision for IT capabilities. IT hardware and software have short product lifecycles. Customers have ever increasing advanced methods of communication. For Berneslai Homes to remain at the forefront of the ALMO sector it is important to take full advantage of new technologies finding new and more efficient ways of delivering services to customers and streamlining back office functions. The ICT strategy prioritises areas for investment. All proposed investment in ICT is supported by a business case demonstrating the link back to the company's strategic objectives. We are working closely with BMBC on the Customer Services Organisation project to e-enable services and introduce a CRM system which will lead to more cost effective back office functions.
Service reviews and Improvements
The Delivery plan includes an annual service improvement plan which sets out areas of service we will review and improve during the coming year. Customer involvement in the implementation of this plan is agreed with the Tenants Federation.
Support Service reviews
The Company spends around £6M with the Council on Support Services. Some of these services including Barnsley Connects and Neighbourhood Services have a significant and direct impact on our customers. Hence it is essential that they are high quality and cost effective.
Support services are reviewed following Best Value principles and all have been reviewed on several occasions. We have shown that the majority of services provide Value for Money. However where this was not the case alternative delivery mechanisms have been put in place.
Where services continue to be provided by the Council we work closely with and challenge support service providers to ensure we have a clear charging mechanism and to ensure there are ongoing improvements to the services in line with our customer priorities
Recent improvements actions include:-
- Working with the Council on the Customer Services Programme to improve the customer experience at first point of contact through a new telephony system, Customer relationship management system, improved website and increased opportunities to self-serve. In addition through the move from more expensive face to face enquiries to increased contact via telephone and the internet releasing resources to focus on more complex problems.
- We continue to buy our Insurance through BMBC and have been working closely with BMBC Insurance Team to ensure we can successfully defend claims. As a result our processes have been improved and the number of claims that have been successfully defended has increased as a result.
- We havesuccessfully tendered for an Occupational Health Service as BMBC did not have the capacity to continue this work for Berneslai Homes.
- Following a Challenge Berneslai report on Grounds maintenance a task and finish group involving representatives of the Tenants Federation together with Berneslai Homes and BMBC officers will shortly be making recommendations to the Board.
Performance Management
Effective performance management is central to ensuring the delivery of key business and service priorities. A comprehensive and robust performance management framework using a balanced scorecard is in operation. Performance targets are challenging, reasonable, meaningful and linked to the aims and objectives of the organisation. Managers review them monthly and variances are reported to a Performance Management Team meeting where reasons are discussed and remedial plans agreed. Performance is reported quarterly to the Board and the Council. The Performance Management Framework has been updated in 2013 to be more streamlined and have a clearer focus on performance which has a direct impact on the sustainability of the 30 year business plan given risks associated with Welfare Reform
The loss of rent income on empty properties has been significantly reduced by effective joined up working throughout Berneslai Homes and construction partners together with very strong performance management arrangements. Voids turnaround has been reduced from 57 days in 2004/5 to 21 days in 2013/14.
Rent Collection Performance remains an area of significant strength for Berneslai Homes with the BV66A indicator for 2013/14 out-turning at 99%.
Financial Performance
The base budget is reviewed each year as part of budget setting and staffing budgets are built up from zero base using approved structures. Managers play a central role in the process and must demonstrate the need for each budget line as well as demonstrate that they can make financial savings wherever possible in order to deliver new service developments or improvements.
SMT receives weekly updates on key budget issues, with monthly monitoring by budget holders the outcome of which is reported quarterly to the Board.
BH has already delivered significant efficiency savings. The efficiency register currently includes savings of£38M delivered since 2005. The register is updated regularly and is now being published on the Internet.
Monitoring of SLAs
Regular monitoring meetings involving customers for front line services take place for each SLA with the Council where performance is reviewed and any resulting improvement actions are agreed.
Benchmarking of activities and costs leading to management action to improve
BH has been a member of the House mark benchmarking club since 2002. The results are used to identify areas for management action. We have low cost core housing management services ( thelowest of all ALMOs in the House mark benchmarking club) combined with good performance on PIs.
The table below shows the Berneslai Homes Housemark benchmarking results for 2012/13 compared to other metropolitan authorities
We also participate in the Housemark unit cost benchmarking exercises
Within support service reviews benchmarking of costs and performance has been used to demonstrate value for money and identify areas for improvement. The achievement of improvements is then monitored through monthly performance meetings.
Processes & Procedures
We are streamlining business processes to gain efficiencies while maintaining a strong customer focus and customer involvement in setting priorities. We use IT to improve processes. Recent actions taken include:-
Electronic Payment of Utility Bills
We continue to use an electronic system for paying Utility Bills which has realised the following benefits:-
- better information on utility payments to promote improved management and control of these costs
- minimised the risk of supplies being terminated for non- payment.
- reduced administrative time and costs in processing invoices
- supplies have been moved to the cheapest contracts through YPO.
- no more charges for copy bills & late payment
Insurance claims
We have reviewed the processes for dealing with Insurance claims. This has resulted in claims against Berneslai Homes being defended more successfully.
Employee Administration
We have worked closely with the BSS (Business Support Service) to introduce more automated processes in employee administration, the absence return and car mileage forms are now on line and the new starter and variation to contract forms will be implemented shortly.
Letter Production
The increased use of external services, in particular for bulk mailings, has streamlined processes and reduced costs. We save an average of40p per letter by outsourcing bulk mailing.