Industry news


Gentoo chief executive resigns


The chief executive of Sunderland based Gentoo, John Craggs, left the 29,000 home association just before the Homes and Communities Agency downgraded it to a non-compliant rating for governance failings. Sunderland’s largest housing association


was judged non-compliant due to a failure “at the most basic level” relating to a number of payoffs to outgoing senior executives. The HCA said that Gentoo “exercised


weak governance and internal control when agreeing executive contracts and severance payments to outgoing executives. In doing so, the board has failed to safeguard its reputation, and that of the sector,” the regulator said. In issuing a strong rebuke to the


landlord, the HCA said: “The board failed to ensure adequate control and scrutiny in discharging its responsibilities. It lacked effective oversight and an appreciation of risk in discharging its responsibilities in line with its own governing documents and scheme of delegation. It failed to ensure that governance arrangements were operating at the most basic level.” The HCA said Gentoo’s board and


renumeration committee “lacked clarity and transparency” with regard to executive pay and severance arrangements and proposals “were not diligently scrutinised and challenged” as a result. The association’s new chairman Keith


Loraine said the Gentoo board had self reported the issue to the regulator and was bitterly disappointed by the downgrade. “We are now seeking further legal advice about the possibility of obtaining redress or recovery. Such payments are not in keeping with the group’s ethics as a responsible business, and it will not happen again.” The regulator said the organisation “has


so far responded positively and is working with the regulator to agree a plan to resolve the issues”. It warned that an increased reliance on sales in its business plan may affect its future financial viability, adding that “forecast margins appear optimistic in the light of recent performance”. It said the discovery of a “substantial number of properties” which are not compliant with the Decent Homes Standard would add costs to the organisation’s costs making it more vulnerable to risks.


Luminus selects merger partner


H


untingdon-based housing association Luminus is to merge with Places for People in a move it hopes will bring an


end to a turbulent year which saw it downgraded by the regulator and its long standing chief executive leave abruptly. The association was downgraded for failings in its


governance by the HCA after it was revealed more than 1,000 homes had not had a valid gas safety certificate for up to two years. It then lost its chief executive Chan Abraham who left the association on the same day he resigned. The 7,300-home association was downgraded to a non-compliant G3 for governance for placing its


tenants at risk of “serious detriment”. It was found to have breached the Home standard. The board failed to notify the HCA of the gas


servicing issue despite this being a well-publicised area of concern for the regulator. When downgrading the association, the HCA was critical of the board saying it “did not seek to understand the root causes of the failure.” A recently published value for money statement


revealed an audit of health and safety by consultancy Altair showed “non-compliance with numerous elements of cyclical servicing in relation to health and safety”. These are believed to have included electrical safety failings.


Fire safety breaches included in rogue landlord database


Breaches of fire safety by private landlords will be included in the Mayor of London’s new database of rogue landlords. Entries will be based on legal cases brought against landlords by either the London Fire Brigade or a local authority. Caroline Pidgeon, a Liberal Democrat


member of the London Assembly, said: “I welcome


the creation of a London Rogue Landlords database to help private tenants. It is long overdue that tenants and prospective tenants can find out about landlords. Such information will be vital to allow people to find a safe and secure home and avoid the exploitation from rogue landlords.


www.housingmmonline.co.uk | HMM November 2017 | 19


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