BOROUGH OF POOLE

REPORT TO THE COMMUNITY SUPPORT OVERVIEW COMMITTEE

9TH DECEMBER 2003

REPORT TITLE: ARMS LENGTH MANAGEMENT ORGANISATION (ALMO)

PART OF PUBLISHED FORWARD PLAN: YES

1. PURPOSE AND POLICY CONTEXT

1.1To give Members an update on progress with the ALMO

2. DECISIONS REQUIRED

2.1To recommend to Cabinet:

The staff be transferred to the ALMO in accordance with the attached staffing structure and under the TUPE Regulations

The proposed name for the ALMO

To an ALMO “go live” date of 1st April 2004

3. BACKGROUND INFORMATION

3.1The Poole ALMO bid has been accepted by the ODPM with an initial allocation of (£17 million) against an overall bid of (£35 million).

3.2To go ‘live’, the Council must submit a Section 27 application to the ODPM and receive Government approval.

3.3The ALMO must ensure all aspects of its services have been subjected to Best Value Reviews prior to the Audit Commission ALMO Inspection. The ALMO Inspection will take place at least 6 months after the ALMO ‘go live’ date.

3.4The Council had provisionally booked two dates for Inspection for the Audit Commission. One was for July, and the other for September. They have now confirmed that they will inspect in October or November 2004.

3.5Given the difficulty of completing all preparations for an ALMO go live date in January, it is proposed that we aim for an April “go live” date and an October or November inspection.

3.6 Subject to achieving a minimum 2* assessment, funding will be released approximately 2 months after the ALMO Inspection.

4. STAFFING

4.1 Staff will transfer to the ALMO under the Transfer of Undertaking Protection of Employment (TUPE) regulations.

4.2 In preparing the staffing structure for the ALMO, the Council has sought to minimise redundancies and ensure a smooth transition.

4.3 Staff who have been carrying out 50% or more of the function of posts within the ALMO, have been matched to these posts.

4.4 The staffing structure for the ALMO is shown in Appendix A.

This is colour coded and shows:

Green – Housing Management staff / posts to transfer

Blue – Staff from other service units to transfer

Purple – New posts being established

4.5 The ALMO Board will wish to review the structure at an appropriate time after going live.

4.6 Further work is required to ensure all job descriptions are consistent and reflect the changed responsibilities of the ALMO staff.

4.7The ALMO Shadow Board has agreed to take all existing Council staffing policies and guidelines until such time as the as it is able to review them.

5. FINANCIAL ISSUES

5.1An action plan has been developed to ensure the satisfactory transfer and operation of the new ALMO, this includes ensuring all staff in the new organisation are correctly paid, systems of accounting are available and banking facilities are in place.

5.2There will be costs associated with setting up this new organisation that fall on the ALMO, and consequently Housing Revenue Account. Currently provision has been made in the 2003/2004 budget of £110,000. Further provision will be required to be identified in 2004/2005 to support the provision of new accommodation and other associated issues with the transfer.

5.3There are likely to be both residual and ongoing costs that will fall on the General Fund consequential to the transfer. These costs are currently being assessed and will be reported to Cabinet along with the development of the 2004/2005 budget.

6. CONSULTATION PROCESS.

6.1 Work has been ongoing to raise awareness of the ALMO with all tenants and leaseholders and to prepare for the ‘test of support’. Although there is no laid down procedure, it must be demonstrated that tenants / leaseholders are being, and will continue to be, consulted in accordance with;

The Poole Tenants and Leaseholders Partnership Agreement

Section 105 of the 1985 Housing Act

6.2 Good practice indicates that tenants and leaseholders should be given detailed information and an opportunity to comment on:

Reasons for setting up ALMO

Functions to be transferred and the continuing role of the Council

The composition and status of the ALMO and Board including the selection and role of the Tenant Board members

Tenant and Leaseholder rights

Performance Standards for the ALMO

6.3 This will need to be demonstrated as part of the required Section 27 application currently proposed for (December)

6.4 To date tenant and leaseholders have been consulted at the ‘Option Appraisal’ stage through a number of open days, supported by articles in the ‘At Home’ newsletter, setting out the position with the HRA, and the investment needs of the housing stock.

6.5 In June 2003, representatives of the Housing Consultation Panel selected SOLON to act as ‘independent tenant advisors’ (I.T.A) to work on behalf of tenant and leaseholders. This has seen the development of an ALMO ‘Implementation Group’, to promote initial training of tenants, leaseholders and Councillors.

6.6 SOLON are currently working closely with the Tenant Participation Officer on the next stage of consultation, in preparation for a test of support of the proposals during the week commencing the 1 December 2003. This will involve raising awareness of the proposals with all tenant and leaseholders and, in particular, difficult to let groups, through:

Free phone help line with SOLON

Special edition newsletters

Leaflets, posters and cards being distributed in reception areas, libraries, local shops, all sheltered housing common rooms

Road shows / public meetings on all major estates

Door knocking by SOLON, tenant and leaseholder representatives

Housing staff making presentations at public meetings

Displays at key locations

Engaging tenants / leaseholders at every opportunity i.e. when reporting repairs, visiting homes, at housing revenue and benefits and at main reception

Drop in meetings at all sheltered housing schemes

6.7The level of support will be tested through a (secret) independent survey of all tenants and leaseholders to be undertaken by the Market Research Unit of Bournemouth University. This is to take place from 1st to 5th December.

6.8The ODPM requirement is that the majority of tenants and leaseholders must support the proposals for the ALMO.

6.9It is important that we raise awareness and knowledge among officers, resident representatives and Members, many of whom may be contacted by residents during this phase of consultation. To ensure correct and up to date information is being given out, an information sheet has been produced, a draft of which is attached as Appendix 1. Enquires can be referred to the free phone help line.

6.10A special ALMO edition of the ‘At Home’ newsletter is to be distributed to all tenants and leaseholders within the next 7 days. This will include the dates and venues for the proposed estate meetings to which members of the Shadow Board are welcome to attend.

7.0NAME OF ALMO

7.1The Shadow Board has recommended the following name for the ALMO:

“Poole Housing Partnership Limited”

7.2In reaching this decision, the Board considered a number of suggested names, resulting from consultation with Poole residents, and with staff, as well as a review of the names of other existing ALMOs.

7.3The Head of Legal Services has completed a search and can confirm that this name is available to be used.

7.4As the ALMO is a company limited by guarantee, the name needs to include Ltd.

8. CONCLUSION

8.1Overall, the ALMO project is progressing well.

8.2The strategy on staffing has worked well with staff and the trade unions comfortable with the process.

8.3Early indications suggest that the consultation with residents is progressing well. A key issue will be how to engage the large group of tenants and leaseholders who do not attend the arranged meetings.

8.4The Board is developing well. A comprehensive training package will be developed with each individual and as a team, once the independents have taken up post.

8.5A challenge will be the carrying out of a Best Value Review to cover all those elements of ALMO services that have not yet been reviewed; this needs to be completed prior to the Audit Commission ALMO inspection which is timetabled for October or November 2004.

8.6To date, we have completed Best Value Reviews of Repairs and Maintenance, and sheltered housing.

8.7The next Review will need to cover:

Estate Management

Rent Accounting and Collection

Caretaking and Cleaning

RTB and Leasehold Management

Tenant Participation

Service Planning and Delivery

Report Authors

Joe Logan / Simon Hendey
Head of Housing Management Services / Head of Housing & Community Services

Appendix A is not available electronically

APPENDIX 2

POOLE HOUSING ALMO

Why ALMO?

The Money

The stock condition survey in 2000 showed a £17 million backlog of repairs.

An independent Stock Options Appraisal showed only two options:

  • ALMO (Arms Length Management Organisation)
  • LSVT (Large Scale Voluntary Transfer)

Tenants and Leaseholders did not want to transfer to a Housing Association, which left ALMO as the only option.

ALMO is a way to fund the fund shortfall and reach 100% Decent Homes by 2010.

Meeting the Decent Homes Standard will cost £58 million.

The ALMO funding will provide £35 million towards this.

There is NO OTHER WAY of getting this money apart from LSVT.

What is an ALMO?
A registered company limited by guarantee
Wholly owned by the Borough of Poole

Run independently by Board of Directors comprising:

  • 5 Tenants/Leaseholders (4:1)
  • 5 Councillors
  • 5 Independents

Finance

Legal

Personnel

Building

Faith

The ALMO does not own the Housing Stock – it manages and improves it

The ALMO is a non-profit making organisation. All “surpluses” are invested in the housing stock in more repairs.

ALMO status is only available to the very best councils in the country

A minimum 2** Audit Commission Assessment is needed to achieve ALMO status

The ALMO will be independent of the Council and move offices

What Will ALMO Do?
  • Preparation of the Housing Revenue Account Business Plan
  • Delivery of the Decent Homes target for Council Housing
  • Repairs and maintenance of stock
  • Provision of Estate Management and Leasehold Management
  • Enforcement of tenancy conditions
  • Rent accounting, recovery of arrears and leasehold service charge collection
  • Cleaning and caretaking service
  • Promotion and support of tenant & leaseholder participation
  • Voids and lettings
  • Best Value Review of ALMO
What Will The Council Do?
  • Strategic housing function and housing strategy
  • Enabling new social housing provision
  • Cross-tenure stock condition
  • Allocations
  • Homelessness function
  • Housing advice
  • Community safety
  • Private sector renewal
  • Affordable warmth strategy
Tenants Guarantee
  • Tenancy conditions unchanged
  • Remain tenants of the Council
  • Future tenants, the same
  • RTB and all conditions unchanged
  • Rent levels unaffected
  • Right to be consulted unaffected
  • Will only happen if supported by a majority of tenants and leaseholders
  • “Two Way”: Can revert back to Council, once Decent Homes target met
What Will Happen if ALMO is Not Supported?
  • Government will not allow Decent Homes target to be missed
  • Would require the Council to transfer the homes to a Housing Association
  • This would be a Large Scale Voluntary Transfer (LSVT)
  • Tenants would become Housing Association tenants
  • New tenancies would be “assured” not “secure”
  • “One Way”: once transferred there is no way back to the Council
Independent Advice

SOLON are independent tenant advisors

SOLON were recruited by a panel of residents

SOLON work for residents NOT the Council

SOLON Freephone Advice Line: 0800 169 4406

Further Advice/Details
Joe Logan / Head of Housing Management Services / 01202 633402
Bill Shaw / Best Value & Performance Manager / 01202 633423
Dorothy Allen / Tenant Participation Officer / 01202 633412
SOLON / Independent Tenant Advisor / 0800 169 4406
Timetable
Stock Condition Survey / 2000
Independent Option Appraisal / 2002
ALMO agreed by Council / 2002
Bid to Government for £35 million / May 2003-
Bid successful / June 2003
Shadow Board set-up / October 2003
Test of support from residents / December 2003
ALMO Goes Live / January/February 2004
Audit Commission carries out ALMO Inspection / September 2004
Audit Commission Assessment / November 2004
Subject to achieving a minimum of 2** in the assessment
Government release funds / November 2004
ALMO Investment Programme begins / January 2005
Year 1 / 2005 / £11,600,000
Year 2 / 2006 / £11,600,000
Year 3 / 2007 / £11,600,000
Year 4 / 2008 / £11,600,000
Year 5 / 2009 / £11,600,000
Decent Homes

What is the Decent Homes Standard?

The government requires all Council homes to meet this standard by the year 2010. The standard comprise of the following:

  • Be fit for habitation
  • Be in a reasonable state of repair
  • Have a modern kitchen and bathroom
  • Have effective heating and insulation
The Type of Improvement Works
Example of a new kitchen / Example of a new front door
  • Kitchen replacement
/  / 10 year contract – starts November 2003
  • Bathroom replacement
/  / Starts 2004
  • Front door renewal
/  / 5 year contract – starts December 2003
  • Central Heating upgrading
/  / New efficient heating systems – starts 2004
  • Life-line
/  / Warden call system replacement
  • Re-wiring

  • Cavity-wall and loft insulation

  • Estate improvements