Are Housing Mutuals the answer?

Last evening 30 of us squeezed into a small upper room in Westminster to take part in the second of Res Publica’s celebrations of 2012 being the International Year of the Cooperative, the topic being ‘Housing Mutuals: Social Ownership for Community benefit’; see http://www.respublica.org.uk/.
We heard the uplifting story of the Rochdale Boroughwide Housing Mutual supported by the equally heartening story of Phoenix Community Housing. Rochdale is of course the birthplace of the Cooperative Movement and there are 50 Coop businesses in the Phoenix area of Lewisham.
Chief Executive Gareth Swarbrick explained how he had led the Rochdale ALMO process only for it to run out of money and then how, with the help of academic facilitator Prof Ian Cole, the tenants and employees decided the solution was to form the Mutual. Parts of Rochdale ranks as the10th most deprived area in the country and yet now the tenants and the Housing Department employees ‘own’ and manage 13,800 homes backed with a £120m funding package.
Ministerial approval in July 2011 was followed by a 76% vote in favour in December allowing the transfer to be completed in March this year. Tenant Lynn and local Housing Manager Phil discussed how the tenants and employees collaborated well right from the beginning, although it was a lot of hard work.
The innovation at Rochdale compared with the normal Gateway model is the establishment of their Representative Body with 15 elected tenants and 8 elected employees with 2 Council nominees and 3 external stakeholders. This body set the framework and lobbies the Board to which it appoints 6 members as Non-Executive Directors; they work with 2 Executive Directors on the (non-representative) Board of Directors to run the operation.
The panel explained some of the legal, financial and inter-personal issues but the realisation of their shared vision in an area of high financial stress is inspiring. As is the Phoenix Group in an equally stressed part of London who co-own 6,500 homes, 77% of which were built before 1940 and were the worst in the Borough. Funding was provided with £42m of gap funding and £70m from Barclays; annual rents and service charges amount to £25m. These are serious businesses
Phoenix Chief Executive Jim Ripley explained the successes but stressed the need for constant vigilance and encouragement. The Phoenix is owned by 1811 tenant shareholders and 100 non-voting staff as well as 400 Gold (Coop) members. They have just completed their 4,000th internal property improvement and are about to build themselves a bright but modest new office and community centre with training facilities, community cafe and space for the credit union.
The well informed audience chipped in their experiences and frustrations with other housing coops but for me the two most heartening were
• the confirmation that there was no operational or legal barrier to transforming all housing associations into mutuals and

• that a small FSA-approved organisation called Abundance was focussing on community ownership of renewables. www.resilientenergy.co.uk/pb/wp_1612d80c/wp_1612d80c.html
Footnote

The evening was hosted by a gang of young res publicans one of whom was continuously tweeting; the tweets were projected live but seemed to be more about who was speaking than what they were saying! Copies of Res Publica’s ‘At the Crossroads: a Progressive Future for Housing Associations’ were made available.