Blog: Scottish council housing services are improving – but budget cuts require more radical action

Kirsty Wells is head of HouseMark Scotland

A new report published in March by Audit Scotland provided encouraging evidence that Scotland’s local authorities have made important progress in the levels of service they provide in housing, even in the face of ongoing cuts to funding.

Audit Scotland’s analysis of councils’ performance during the 2014-15 financial year showed a significant increase in the proportion of local authority housing meeting Scottish Housing Quality Standards, up from 83.7 per cent in 2013-14 to 90.4 per cent. This is a huge improvement on the 53.6 per cent of dwellings meeting those standards five years previously.

There has been similarly important progress in the number of council dwellings that are classed as energy efficient, rising from 74.9 per cent in 2010-11 and 94 per cent in 2013-14 to 96.5 per cent the following year.

More modest improvements were recorded in relation to the percentage of rent due but lost during the year due to properties being empty, down from 1.3 per cent to 1.2 per cent year-on-year. Similarly, the average time taken to complete non-emergency repairs to council housing fell slightly from 10.2 days the previous year to 9.9 days in 2014-15.

The report’s findings suggest that local authorities are making continued efforts to get to grips with performance issues in housing and important progress has been made.

But the headline conclusion of the report perhaps gives more significant pause for thought. This was that, given the scale of cuts to local authority budgets anticipated in the years ahead, making incremental savings through improved performance will no longer be enough. Indeed, the report specifically concludes that: “The Accounts Commission continues to be concerned about councils’ slow progress in delivering services differently, rather than relying on incremental savings to existing models of service delivery.”

Whilst Housing Revenue Account ring-fencing means that housing department budgets may, in part, be protected from some of the budget pressures being faced by other services, there is a clear expectation that housing departments must ensure they are delivering the best value for money for their tenants and for the public purse. Like other council services, housing staff need to be looking at new ways of working to deliver these savings.

Defining what those new ways of working should be will be the next big challenge local government housing departments will have to grapple with as they seek to achieve a step change in performance that enables them to maintain high standards of service with reduced budgets.

The best way of doing this is to measure their costs, resources and performance against peer organisations, to identify examples of best in class and, wherever possible, to emulate these. That is why cost and resource benchmarking is such an important tool for housing providers to use in these financially constrained times.

Audit Scotland’s report conclusions seem to suggest that Scottish local authorities are still making insufficient use of such benchmarking to drive the significant step change in improving performance that will be required over the next few years.

Without that step change, the risk is that future audits of the performance of Scottish local authorities in relation to housing will start to show a decline in standards as budget cuts really begin to bite. To avoid that from happening, Scotland’s Councils should be acting right now to benchmark their operating costs and performance against as wide a pool of their peers as they can, including other types of housing provider and local authorities in other parts of the UK.

Through robust, validated benchmarking, there is an opportunity to achieve a different approach to service delivery in Scottish council housing. But the Audit Scotland report is also an important wake-up call that the time to act is now.