Asset Management Strategy

Transcription

1 Asset Management Strategy

2 Executive summary This strategy sets out our investment plans up to It described the approach to asset management that is required to deliver the Corporate Plan objectives and follows part one, the strategic review of our stock approved by the Board in September This strategy will: l Deliver services that meet customer needs through improved technology, improved contractor & staff performance and further building the right culture through the Institute of Customer Services. l Continue to improve the energy efficiency of our homes through improved heating systems and other measures and take advantage of grant funding to support our green investment. l Continue to achieve value for money through a comprehensive procurement plan, improved repair diagnosis, and improving cost certainty in services such as renewable equipment and gas servicing programs. We will re organise our major works program to achieve lower management costs. l Provide safe homes through the effective management of risk areas, we will continue to implement the latest industry practices and achieve a nationally recognised management system for fire prevention. l Review how services are provided across our stock recognising the diversity of buildings and people and needs of both rural and urban residents. 2

3 1 Background and introduction 1.1 This document sets out our strategic approach to Asset Management for the five year period from together with the investment plan set out in appendix It is driven by Hastoe s Corporate Plan and its vision of sustainable homes in sustainable communities plus key strategic ambitions: l To be distinctive in the quality of homes and services l To encourage innovation l To safeguard rural communities l To protect the climate l To use our experience to influence national policy 1.3 This strategy also supports and links to: l Value for Money Strategy l Greening Hastoe Strategy l Affordable Warmth Plan Asset Management Strategy This paper is the second and final part of the Asset Management Strategy. Part One was approved by the Board in September. It included a fundamental review of our approach to strategic asset management which consisted of a detailed quantitative analysis of our whole stock portfolio, including calculations at the individual property level. Its conclusions stand alone and also provide a strong basis for this part two. 1.5 In summary the vast majority of our stock provides satisfactory levels of returns for the nature of our business and that no estate or scheme suffers from demand problems. Therefore, beyond a modest programme of trickle sales (disposal of properties at vacant possession) any disposals of property that is occupied would only be carried for strategic reasons. This is addressed in section seven of this strategy. l Customer Service Strategy l IT Service Plan l Corporate Risk Map l Diversity Strategy 3

4 2 Asset 3 To substantially improve customer Management satisfaction with asset management services Strategy This strategy has four key aims: l To substantially improve customer satisfaction with asset management services l To continue to improve the energy efficiency of our stock l To deliver value for money in the management of our stock l To ensure residents live in safe homes through the effective management of risk Where are we now? 3.1 We know that residents overall satisfaction with Hastoe is significantly influenced by their experience of our day to day repairs service and the condition of their homes. We know expectations differ amongst demographic groups. Our current customer service strategy shows that nationally customer expectations are rising, particularly amongst younger people who are better informed and often have greater choice than previous generations. Our adoption of the Institute of Customer Services (ICS) framework will assist us in driving improvements in our service 3.2 We know that despite improvements in some key performance indicators, our repairs service in the east and south regions has failed to deliver lasting improvements in some key areas and that this has made a considerable contribution to residents perception of the service. On the basis of this we ended the previous contractual arrangements, designed a new model of delivery and retender the services in those regions. In the life of this strategy we will evaluate the effectiveness of this new approach and consider wider implementation of the new model. 3.3 We continue to meet the Government s Decent Homes standard and have made considerable progress in improving the external fabric, wind and weather tightness of our stock and major components of our flatted buildings such as roofs. 3.4 We have also successfully improved over 220 homes with new energy efficient heating systems and 400 homes with improved insulation 3.5 Our latest investment plan, appended to this strategy and based upon a stock condition survey completed in 2014, provides opportunities to enhance the service we provide through our home improvement program as well as continuing our green investment plan. Where do we want to get to? 3.6 Our simple ambition is to provide services that meet our high quality standards and the needs of our customers. 3.7 This means that we will be vigilant to the changing needs of our customers and use the Institute of Customer Service framework to improve what we do. We know from customer feedback that we need to improve in the following areas: l Getting it right first time l Communication with our residents through traditional means and new media l How we deliver services to different demographic groups by strengthening our work on diversity l Differentiation of service delivery which is addressed in section seven below 3.8 It also means accelerating the delivery of home improvement works to our older housing stock such as kitchen/bathroom/heating upgrades whilst at the same time continuing to meet our other statutory obligations.

5 Asset Management Strategy How will we get there? 3.9 We will support the implementation of the IT Service plan with regards to improving repairs scripting to reduce misdiagnosis and also work to improve options around repairs appointments We will build upon the launch of the home improvements programme by increasing our investment in tackling improvements to our older stock. Key Objective 3.11 We will substantial improve our approach to communications with our residents, doing much more to keep them updated with progress of works, small and large and build a greater understanding of what the service can deliver internally with our staff, so that they can address customer issues much more readily We will continue to improve the delivery of major projects by directly supervising the works ourselves and strengthening the role of resident liaison. Success measure/timeframe Deliver customer satisfaction that compares favourably with the best in our peer group. Complete a review of all suppliers in the context of meeting our customer service objectives We will use the ICS framework to better understand the drivers for customer satisfaction and make a plan for achieving high performance whilst still maintaining value for money. This will be reflected in new KPI s with measurable milestones that clearly monitor continuous improvement. Top quartile performance in our peer group as measured by our customer satisfaction survey. Contractors signed up to and delivering Hastoe s values and vision for customer satisfaction June 2017 Verified by internal Performance Dashboard and benchmarked against peer group performance. Develop our communications so that all residents can access all repair information related to their property Sep-17 5

6 4 To continue to improve the energy efficiency of our stock Where are we now? 4.1 Our Hastoe Green homes standard sets out our ambition to improve our older housing stock up to a SAP score of a minimum of 65. This has been validated by a recent Government consultation on establishing a national minimum standard for energy efficiency which sets a target of 69 to be achieved by 2035 with an interim target of 65 to be achieved by At the end of 2014 our average SAP rating for our stock was 73.9, putting us in the top quartile performance indicator for the sector. 4.3 We continue to make good progress towards this and will have completed the retrofit of highly efficient heat pumps to 226 homes by the end of the current financial year as well as having successfully secured ECO funding for insulation works which we have completed in some of our high rise buildings. 4.4 A customer survey based on those residents who have had works completed in recent years has shown significant satisfaction with new heating systems with: l 96% of residents saying they were satisfied with their new heat pump as opposed to just 16% satisfaction with the previous storage heaters l 60% of residents stating they have saved considerable sums on their heating and hot water bills following installation of the heat pump 6 l 60% confirming that there has been an improvement in reducing condensation and mould growth in their homes 4.5 Despite this, there remain approximately 700 homes that will require significant investment to achieve our standard. Where do we want to get to? 4.6 Our ambition remains to bring our housing stock up to the Hastoe Green Homes Standard with (amongst other things) a minimum SAP score of In order to achieve this by the Government deadline of 2025 we will need to allocate spending beyond the life of the current investment cycle which ends in This will be included in corporate planning prioritisation over the coming years.

7 Asset Management Strategy How will we get there? 4.8 We will review our Hastoe Green Homes Standard in light of our review of our urban estates and the government consultation on the national fuel poverty strategy and following the general election to assess the impact of any changes to government policy. 4.9 We will continue to review our approach to improving the energy efficiency of our homes by evaluating best practice across the sector We will seek opportunities to augment our investment plan by seeking to maximise external funding streams such as ECO, RHI and FITs Continue to work with the village of Barcombe to support their endeavours to secure a community communal energy system and continue to search for other opportunities in the communities we work in We will build upon the success of our Green Doctors initiative and evaluate opportunities that our investment programme may present to improve the health of our residents i.e. through schemes such as prescribe a boiler as piloted by Gentoo. Key Objective Review Hastoe Green Homes Standard Success measure/timeframe December

8 5 To deliver Value for Money in the management of our stock Where are we now? 5.1 We have benchmarked our costs across a number of indicators through Housemark. We compare favourably across the sector being in the upper quartile group when comparing average costs per property for voids and responsive repairs. 5.2 Our recent procurement exercise for new contracts in the South and East Regions indicate that, across the six contract areas, there are potential savings of 5% on current costs. This reflects the fact that we have sought to appoint contractors within more distinct and localised areas and also that many of them have a greater degree of IT sophistication offering savings on overheads. 5.3 In addition we have adopted a per property cost approach for gas servicing and repairs across several areas. This will provide cost certainty and reduce our current costs per unit. The feedback we have received from contractors confirms that this is very much a result of the previous investment we have made in new boilers over the last six years and also the servicing module that we previously introduced to manage our programme. 5.4 In the last year we have also fine tuned our major works costs for all residential buildings by completing a further highly detailed stock condition survey, moving away from an average cost to individual block costs. This has created further capacity within our future investment programme which may allow us over the course of the next five years to increase our investment in home improvement works, which are required if we are to improve customer satisfaction.

9 Asset Management Strategy Where do we want to get to? 5.5 A service that is value for money and improves customer satisfaction. 5.6 We will maintain at least a 70/30 split for capital investment/routine repairs and seek to improve this as we increase investment into home improvement work 5.7 Costs maintained in line with inflation and property growth 5.8 We will appoint a range of different contractors that strengthen the delivery of our services How will we get there? 5.11 We will continue to analyse those properties where repair costs are significantly above average and establish action plans to reduce future costs We will evaluate the 3 star gas servicing contracts and consider extending this model to all gas appliances We will strengthen further our procurement plan for asset management We will review the structure of the in-house major works delivery team 5.15 We will analyse the possibility of creating a Direct Labour Organisation We will continue to maximise opportunities for external funding to augment our investment plan. 5.9 We will continue to scrutinise our repairs costs through effective control of variations and post inspections as well as benchmarking our costs against our peer group We will work to improve the repairs scripting for Hastoe Hub to ensure that the risk of repairs misdiagnosis is minimised. Key Objective Success measure/timeframe Tackle those properties with significant maintenance costs Prepare action plan by June 2015 Evaluate the advantages and disadvantages of 3 star gas servicing arrangements Implement proposals for new repairs contracts by December 2015 Complete the delivery of a procurement plan for all future asset management services Feed into Corporate procurement project by September 2017 Evaluate possibility of introducing DLO Produce options appraisal identifying risks and possible savings by May 2016

10 6 To ensure residents live in safe homes through the effective management of risk Where are we now? 6.1 We have established a comprehensive risk management program across all residential risk areas and have adopted a comprehensive IT risk management system to support its delivery. Over the past 4 years our approach has significantly reduced all risk areas and embedded a routine planned approach to risk management. We are not complacent however and remain vigilant to continue to seek best industry practice in risk management 6.2 We have again completed our gas servicing program and achieved a good rating following our recent gas audit with no substantial recommendations for improvement. 6.3 We have also completed our bi annual fire risk assessments to all relevant buildings. We have also introduced a new fire risk strategy and aim to achieve nationally recognised accreditation in this area. Resultant works to buildings are programmed into our investment plans 6.4 We have completed a programme of improvement works following Legionella risk assessments and introduced schemes of control. Where do we want to get to? 6.5 Our aim is to ensure that all Hastoe properties continue to be safe for our residents and that whilst risk can never be eliminated completely it is effectively understood, constantly monitored and skilfully managed. How will we get there? 6.6 We will ensure we comply at all times with relevant statutory obligations including approved codes of practice. 6.7 We will maintain a robust servicing programme that ensures that all plant and machinery is maintained to the highest standards. 6.8 We will evaluate and deliver best practice across the sector and seek 3rd party verification of our approach to risk management. In particular we will seek to achieve certification against the PAS 7 British Standard for fire safety management. This will provide us with a quality assured system of fire risk management 6.9 We will ensure that our staff have the appropriate training necessary to manage risk and access to expert consultancy services where required Where the responsibility for risk remains with our residents we will ensure they have access to good quality advice through our tenants handbook, relevant information leaflets, website and regular features in our resident newsletter. Key Objective Success measure/timeframe Achieve accreditation against British standard PAS 7 Certified by independent auditors by June

11 7 Stock diversity, service differentiation 7.1 In part one of this strategy we concluded that our stock performs at the right level, in terms of return on investment and letability to meet our corporate objectives. A small programme of stock disposal, known as trickle sales were agreed, to support our development and retrofit programme. 7.2 With this agreed it has highlighted a need to refresh our approach to service delivery across the diversity of the homes we own, which is set out in this strategy. 7.3 The graphic below illustrates the age profile and design of our stock. Asset Management Strategy Age profile of stock Town estates built in the 1960 s Rural homes built since

12 We customise the services for our different stock. For example on our urban estates we provide: Estate based services (caretakers) Community rooms Gardening clubs Specialist leasehold service 7.5 In the life of this strategy we will strengthen that approach by l Reviewing our Green Homes standard, in 2015, to ensure that the needs of the urban stock are keeping pace with the improvements to our rural homes and l Look again at opportunities to develop on sites within our urban schemes 7.6 This advance, together with the key objectives above, should see real improvements in customer satisfaction and value for money. 7.7 The Board has agreed that there is no economic driver to commence a strategic disposal of our urban stock but accepts that from time to time there might be opportunities that offer financial gain and improved service delivery for our customers. 7.8 Whilst flexibility is important, this strategy outlines the Boards approved framework within with advantageous disposal could be considered. 7.9 For stock that is in existing use to be considered for disposal, the factors below would influence the decision to dispose to or swap with another social landlord. l Low level of customer satisfaction/customers wish to transfer l High arrears and or high turnover/voids l Disproportionate amount of short/medium term investment required l High frequency of responsive repairs l High potential risk (gas / fire / legionella) l Lack of spare land for development Excellent local housing provider interested in purchase at favourable price 7.10 The criteria provides a framework for consideration, so that proposals can be evaluated at an early stage before formal consideration. Any decision to dispose of stock rests with the Board. 8 Conclusion 8.1 To deliver the ambitions set out above, which are in line with those set out in our Corporate plan, requires at least 30mil of investment over five years set out in the appendix below. 8.2 We have integrated a degree of flexibility to be prepared for most eventualities. The strategy sets out the way to deliver on our aspirations but is subject to the annual budgeting cycle.

13 9 Investment plan - Appendix 1 Our investment plan for the next 5 years is detailed below. It reflects the most up to date stock condition surveys. Asset Management Strategy Capital Expenditure 2015/ / / / /19 Roof Windows Walls Doors Boilers Radiators & Pipework Storage heaters/heating improvements Kitchens Bathrooms Lifts Provision for adhoc component/capital renewals Total Financial Plan Variance Green Investment (capital) Revenue Expenditure Electrical Rewires to dwellings Communal Electrical Rewires to Blocks Door Entry Systems Fire Safety Management External Works to schemes Decorations Asbestos Management Consultancy - repairs/keystone/stock condition Legionella Management Continued on next page... 11

14 8 Investment plan - Appendix 1 (continued) Capital Expenditure 2015/ / / / /19 Roofs - Leaseholders Windows - Leaseholders Walls - Leaseholders Lifts - Leaseholders Communal Electrical Rewires to Blocks - Leaseholders Door Entry Systems - Leaseholders Decorations - Leaseholders Risk Management - Leaseholders (assumed 20% recovery) Response repairs Servicing Contracts Empty Property Repairs Aids & Adaptations Estate Improvements Total Financial Plan Variance Total Amounts due from leaseholders Forecast leaseholder income Financial Plan Variance Revenue net of leaseholder recovery Actual Financial Plan Variance[1] [1] Where the projected outturn exceeds the annual financial plan allocation we will prioritise spend through the budget setting process.