value-for-money-graphicThe recent letter from Matthew Bailes of the HCA to the Chairs of Housing Associations is stark reminder that Housing Associations need to demonstrate to their stakeholders how they are delivering VFM.

In a nutshell, if Housing Associations want to demonstrate a robust approach to delivering Value for Money, they must show that they have addressed employee costs and productivity.

Recent events show that the HCA will down grade the governance of associations where it feels they are not demonstrating VFM. It is clear from the letter, that the HCA feel there is room for improvement, and that in future, enforcement will be far more rigorous.

The final paragraph makes reference to poor decision making regarding remuneration, severance and redundancy.  There is a clear suggestion that associations’ should plan their approach to such issues now, by reviewing long standing terms and conditions.

This stance has been reemphasised by the recent criticism and governance downgrade of Severn Vale Housing Society following its failure to addresses or revise its long standing early retirement policy.

This final paragraph makes it clear that managing people, their performance, productivity and cost is essential if an association wants to show that it is delivering value for money from its payroll.  If associations haven’t already done so, now is the time for them to address VFM from their payroll

This should include:

  • The creation of a grading structure for all staff including the Executive Team, and the allocation of staff to grades using a fair and transparent pay grading framework
  • Benchmarking salaries and benefits in kind to ensure they reflected the “going rate”
  • Sensitively managing, where necessary, changes to terms and conditions
  • Rewriting outmoded and unnecessarily generous staff and Executive redundancy and severance schemes
  • The creation of a staff and executive competency framework that specifies the behaviours that will deliver a competitive advantage
  • The creation of a robust and transparent appraisal and performance management framework

This blog was posted by Sean McCann the Managing Director of People Based Solutions an HR consultancy specialising in HR, OD, Performance Management and Reward Management.

If you would like to discuss staffing issues and value for money, or how People Based Solutions can support you with your HR, OD, Performance Management  and Reward Management issues generally, contact enquiries@peoplebased solutions.com.