BUSINESS STRATEGY 2021 2026 - Railway Housing Association
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2021 - 2026 BUSINESS STRATEGY Railway Housing Association
Welcome
to Railway Housing Association’s
business strategy for 2021-2026.
Residents, our team of staff and our Board have all been
involved in agreeing our plans for the next five years.
Our Values
Caring
Fair
Efficient Our Mission
Open To make best use of our resources to provide good quality,
Trustworthy desirable and affordable homes for residents in need of housing.
Who we are
The North Eastern Railway The Association now owns and Our values of being caring, fair,
Cottage Homes and Benefit manages 1,592 rented, leased efficient, open and trustworthy
Fund, now Railway Housing and shared ownership homes define what we stand for, guide
Association and Benefit Fund, in 24 local authority areas in our decision making and show our
was originally formed in 1919 Northumberland, Tyne & Wear, residents and other stakeholders
to provide homes for railway Cumbria, Durham, Tees Valley, what is important to us. We
workers returning from the First North Yorkshire, Leeds, York, expect to be held accountable
World War and their families. East Riding, Hull, Doncaster and to these values.
It was started with a donation of Hereford. Our homes are now let, We are proud of our heritage,
£10,000 and weekly contributions leased or sold to anyone in need which was celebrated during our
from 7,000 members who worked of housing, applicants do not centenary year in 2019, and retain
for the railway. The NER match need to be railway workers. our charitable values whilst being
funded members’ contributions General needs 559 committed to the future provision
and provided free accountancy, of accessible homes and services
architect and surveying services. Housing for Older People 958
to meet housing need.
The first homes were built in Leasehold schemes
1921 in South Gosforth, York for Older People 73
and Darlington.
Shared ownership 2
The Association has been
registered as a charity with the Total 1,592
Charity Commission since 1962;
and as a registered housing
association since 1976.
Railway Housing Association Business Strategy 2021-2026
Our Operating Environment
Recent years have seen us face an extremely The Social Housing White Paper The UK has now left the European We are well placed to respond We demonstrate excellent
(The charter for social housing Union and the transition to new to all of these many and varied performance across a range
challenging operating environment and there residents) includes changes to trading arrangements is causing challenges and opportunities. of services, our homes are
is every indication that this will continue for the regulation of social housing, some uncertainty and increases We are a financially strong and maintained to a high standard,
which require the Regulator to in costs of some materials. There well governed organisation with and we are alert to changes in
the life of this five-year business strategy. take a proactive approach to are still conflicting forecasts of talented staff working together to our operating environment. Our
We quickly adjusted our ways challenges with the requirements making sure that landlords meet the potential impact and it will be make a real difference to peoples’ Board of Directors is committed
of working in response to to promote modern methods the consumer standards. The some time before the impact of lives. Potential risks are identified to responding effectively to
the coronavirus pandemic, of construction, the National Building Safety Bill and Fire Safety Brexit becomes clear. and mitigated by our effective challenges and opportunities
supporting residents to access Design Guide, energy efficiency Bill set out extensive reforms to risk management policy and by combining our charitable
Competition within the social
the support and advice that they and sustainability and the use of building safety legislation and our business plans are regularly ethos whilst making the most
housing sector is also an issue,
needed. We have coped well small and medium sized (SME) improvements to fire safety of stress tested. We aim to avoid efficient use of our resources to
including competition for
with the immediate financial contractors, and the introduction residential buildings. all risk and uncertainty as far as maintain our excellent services
grant funding, development
and operational impacts from of the Right to Shared Ownership. The availability of good quality opportunities, low cost funding, health and safety and regulatory and develop more homes to meet
the pandemic, maintaining data is essential to effective recruiting the best staff, and compliance is concerned, low housing needs.
The grant available towards
essential service delivery and a management of health and attracting residents for some risk options are our preference
building new homes for rent
strong financial position. The full safety, as well as the overall types of properties. for financial matters and our
has been substantially reduced
implications of the pandemic maintenance and improvement of reputation. We are more open
in recent years and there is no The redevelopment of Darlington
are not yet apparent but it has our existing properties especially to risks for customer services,
indication that this will increase railway station means that we will
certainly further highlighted the relating to energy efficiency and development and sales if these
again. The Voluntary Right to be moving out of our main office
need for safe, affordable, warm working towards net zero carbon are likely to deliver a successful
Buy for housing associations to new premises by June 2022.
and comfortable homes for all. emissions. result.
may still be introduced once the We will be working hard to make
The UK’s housing crisis is pilot scheme has been evaluated. Climate change is a huge issue. sure that there is no impact on
ongoing. More people are finding Changes to welfare benefits have The UK has a target of halving services to residents during
themselves priced out of the increased the demand for low carbon emissions by 2030 and the move.
market with high house prices cost social housing. Supporting reaching ‘net zero’ by 2050. The
and private rents beyond their People funding for support Future Homes Standard proposes
means. The shortage of homes, services continues to be reduced increases to the energy efficiency
increased homelessness and and many local authorities have requirements for new homes,
unemployment means that the reduced the support services
provision of affordable social available to our more vulnerable
including the banning of fossil
fuel heating, by 2025. However, Our Priorities
housing is ever more crucial. residents. Against this backdrop, the more challenging issue is the For the next five years we will continue
The government is still focused on significant increases in the older improvement of existing homes
population requiring suitable to focus on our core activities of:
providing homes for sale rather up to high energy efficiency
than rent; and affordable rather accommodation is projected over standards to reduce emissions; • Providing excellent housing management
than social rent. There is a new the next decade. as well as looking at reducing the and maintenance services to residents living
Affordable Homes Programme for carbon footprint of our offices in our older persons and general needs
2021-2026 and this brings its own and how we work. accommodation, leasehold schemes for older
people and shared ownership homes
• Building new homes to meet housing need.
Railway Housing Association Business Strategy 2021-2026
Our Strategic Goals
Our Residents Our Homes Value for Money
We provide excellent services We provide safe, well maintained, We use resources wisely to
that meet residents’ needs energy efficient homes achieve value for money
throughout the organisation
Our Organisation Our People
We will continue to: We will continue to: We are a well-managed and • Meet statutory requirements We are an employer of choice
• Put the needs of residents • Prioritise investment in We will continue to: appropriately governed to protect the health and safety attracting, developing and
at the heart of our business maintaining and improving • Consider value for money in organisation of our residents, employees retaining excellent staff with the
existing homes that are all our spending decisions We will continue to: and anyone else affected skills, qualifications and outlook
• Strive for excellence and
affordable and sustainable by our work, going beyond to deliver our goals
achieve high levels of resident • Achieve year on year efficiency • Have a strong board and
• Maintain our homes to a safe, legal requirements where it We will continue to:
satisfaction savings of 5% of operating costs executive team providing
secure and energy efficient is reasonably practical
• Listen to residents’ views • Agree funding priorities with effective leadership and • Achieve high levels of staff
standard • Promote and demonstrate
residents management satisfaction
• Encourage and support • Comply with all relevant health fairness and equality of
residents to have meaningful • Make best use of assets to • Comply with all regulatory opportunity in the provision • Encourage and support learning
and safety legislation and good
involvement in service practice provide funding for building requirements of services, employment of and development
improvements and decision new homes • Seek to retain the highest rating staff and governance • Recognise and reward staff
making • Provide a repairs service
that aims to meet residents’ • Use our resources to achieve (G1 V1) from the Regulator of • Retain our hard earned for their contributions and
• Let homes in a fair and expectations the right balance between Social Housing reputation as an excellent achievements
transparent way front line services, maintaining • Achieve high standards landlord and employer, • Support wellbeing of staff
• Improve energy efficiency
• Keep rents and service charges existing homes and providing of governance and risk providing quality homes
and reduce fuel poverty • Involve staff in decision making
at an affordable level that new homes management and easy to use services.
• Keep communal areas and • Empower staff to achieve high
provide good value for money. immediate surroundings of • Aim to achieve top quartile • Manage our business to aim • Work towards reducing our
performance in recognised carbon emissions and meeting standards of services
our homes clean and safe to generate a strong operating
value for money indices. margin and ensure our viability national targets to become • Encourage apprenticeships
• Work with other agencies to
is maintained carbon neutral. • Retain silver level Investors
tackle anti-social behaviour and
any other neighbourhood issues in People accreditation.
• Work with stakeholders to
establish future needs for homes
• Provide as many new homes
as we can, by building 42 new
homes in 2021/22, followed by
25 per year up to 2024/25 and
then 30 per year thereafter.Railway Housing Association Business Strategy 2021-2026
Financial forecast
1 April 2021 - to 31 March 2026
Index Commentary
1. The impact of sensitivity in identified developments are assumed to be partly
Commentary areas of high risk and uncertain forecasts funded by Social Housing Grant, the level
is as follows: being dependent on the development’s
Assumptions incorporated size and type.
1.1 Planned maintenance expenditure
in the forecast The estimated expenditure is based on 1.4 Rents receivable Net capital expenditure
the results of stock condition surveys The association’s rents are assumed to
and significant adverse variations are not increase by CPI plus 1%, the maximum 8. Capital expenditure
Housing Revenue Budget anticipated. rent increase in accordance with the
2021/22 2022/23 2023/24 2024/25 2025/26
8.1 Affordable housing developments will be
2021/22 & Forecast to Regulator of Social Housing’s rent Scheme £000 £000 £000 £000 £000 funded by affordable rent income arising
1.2 Mortgage interest rates
31 March 2026 The association currently has four loan
standard. from the units developed, social housing
Developments: grant, borrowing and cash balances.
facilities in place. Two are fully fixed and Affordable housing units developed will
Annual Cash Flow are therefore not sensitive to movements be let on affordable rents on completion, King James School, Bishop
3,279
8.2 Affordable housing units developed will
in interest rates, one is partially fixed until which represent 80% of market rent, Auckland generate affordable rents i.e. 80% of
Forecast from 1 April 2021 March 2023, and one is a revolving credit based on market rent valuations provided market rents (including service charges
to 31 March 2026 facility that can be fixed after 4 years by an independent valuer. Great Western Court,
1,599 where applicable).
in 2022. Over the term of the forecast, Hereford
1.5 Disposals 8.3 The forecast assumes that net capital
Summary Statement of current debt is 48-100% fixed in total
It has been assumed that the Voluntary Addordable housing/ expenditure in respect of development,
without further fixed rates being arranged. 3,172 3,227 3,300 4,069
Financial Position to 31 A significant movement in interest rates
Right to Buy (VRTB) scheme will become other developments remodelling and major repairs is as shown
March 2026 available to the association’s tenants in the table opposite.
from the levels assumed in the forecast
from April 2022 with take up of 2 units Capitalised major repairs 1,365 1,467 1,474 1,536 1,511
would therefore have a significant 8.4 The viability and impact of other
per annum from 2022/23 onwards, that
impact on some of these facilities. New Other capital expenditure 217 220 224 228 220 developments within the period of the
the market value of each disposal will
borrowing is assumed to be on variable plan and into the future, which may be
be received from a combination of sale
rates to reduce inflation risk, but it is likely TOTAL 6,460 4,859 4,925 5,064 5,800 partly funded by Social Housing Grant,
proceeds and reimbursement of discount,
that further fixes will arranged to achieve will be considered on an individual
and that each unit lost will be replaced 2
the association’s policy level of a minimum scheme basis.
years later.
of 70%.
2. Reserves
Assumptions 9. Borrowing
1.3 Development/remodelling It has been assumed that the Barclays
Reserves are maintained at an acceptable 1. Rents 4. Bad debts
The assumed development expenditure is loan will be refinanced in 2021/22 with a
level over the term of the forecast. Increases of CPI for the previous 1.0% of net rents due
in respect of 28 homes in Bishop Auckland new bank facility for a term of 10 years at
and 15 homes in Hereford completing 3. Conclusion September plus 1% from 2021/22 (CPI is a margin of 1.6%.
5. Planned maintenance expenditure
in 2021/22. From 2022/23 to 2024/25, The main conclusion to be drawn from the 0.5% for 2021/22, and assumed at 0.75%
Based on stock condition surveys and Another new bank facility has been
the forecast assumes 25 new homes financial forecast is that the association for 2022/23, 1.0% for 2023/24, 1.5% for
options appraisals; planned maintenance assumed, in 2024/25, for £10.0m for a
per annum followed by 30 new homes remains financially viable. 2024/25 and 2.0% for 2025/26).
expenditure that is required to be term of 10 years at a margin of 1.75%.
per annum thereafter. All new build 2. Voids capitalised is shown in the table above.
1.5% of turnover from social housing
6. Interest receivable
lettings.
Cash balances are available for investment
3. Pension costs except for the minimum liquidity
It has been assumed that the employees requirement of £0.5m.
that are currently members of the 60ths
Interest receivable – 0.0% in 2021/22, 0.1%
CARE structure and employees that are
in 2022/23 and 2023/24, 0.25% in 2024/25
currently members of the 120ths CARE
and 1.0% in 2025/26 .
structure will remain in their current
structures. Employer contributions for 7. Inflation
all employees have been included based The average rate of inflation applied to
on the future service contribution rates revenue items not noted elsewhere is
“Invest in maintaining and determined following the September 2017
revaluation; it has been assumed that a
1.25% in 2021/22, 1.5% in 2022/23, 1.75% in
2023/24, 2.25% in 2024/25 and 2.75% in
comparable increase in future service 2025/26.
improving existing homes that contribution rates to that for 2017 will be
required at each future revaluation.
are affordable and sustainable”Railway Housing Association Business Strategy 2021-2026
Housing revenue budget Budget Year ending Year ending Year ending Year ending
Cashflow
Cash flowforecast
forecastfrom Year ending Year ending Year ending Year ending Year ending
2021/26 and forecast to 2021/22 31-Mar 23 31-Mar 24 31-Mar 25 31-Mar 26 from 1 April
1 April 2019 2021
to 31 to 31-Mar 22 31-Mar 23 31-Mar 24 31-Mar 25 31-Mar 26
31 March 2026 31 March
March 2026
2024
3 £000’s £000’s £000’s £000’s £000’s £000’s £000’s £000’s £000’s £000’s
INCOME NET CASH INFLOW FROM
2,507 2,699 2,869 3,128 3,171
OPERATING ACTIVITIES
Rents receivable 6,286.8 6,516.9 6,750.0 7,029.3 7,353.4
Interest received - 1 3 2 77
Service charges 985.3 1,000.1 1,017.6 1,040.5 1,069.1
Interest paid -853 -690 -873 -1,014 -1,131
7,272.1 7,517.0 7,767.6 8,069.8 8,422.5
NET CASH IN/OUT(-) FLOW 1,654 2,010 1,999 2,116 2,116
Less - voids -86.4 -112.8 -116.5 -121.0 -126.3
Cash in/out(-) flows from investing
Net rents due 7,185.7 7,404.2 7,651.1 7,948.8 8,296.2 activities:
Interest receivable 0.0 1.0 3.4 2.2 76.5 Development activity -5,246 -3,423 -3,228 -3,300 -4,069
Amortised government grant 342.4 348.7 305.8 312.1 312.6 Capitalised major repairs -1,365 -1,467 -1,474 -1,536 -1,511
Other income - rates allowances 29.2 29.6 30.1 30.8 31.6 Other investing activities -125 445 -39 -690 -41
- LSE service charges 80.2 81.4 82.8 84.7 87.0 Grants received 666 625 625 625 750
- miscellaneous 0.0 132.5 0.0 0.0 0.0 Net cash in/out (-) flow from
-6,071 -3,819 -4,117 -4,901 -4,871
investing activities
TOTAL INCOME 7,637.5 7,997.4 8,073.2 8,378.6 8,803.9
Net cash in/out (-) flow from financing 3,850 4,262 -423 9,570 -438
EXPENDITURE INCREASE/DECREASE (-) IN CASH
-567 2,453 -2,541 6,785 -3,193
& CASH EQUIVALENTS
Administration - staff costs 1,446.4 1,463.1 1,488.4 1,522.7 1,557.6
Cash balance b/f 2,022 1,455 3,907 1,367 8,151
- office overheads 689.7 710.2 713.6 673.5 666.0
CASH BALANCE C/F 1,455 3,907 1,367 8,151 4,958
- other expenses 59.3 60.2 61.3 62.7 64.4
Bank charges & interest payable 2.5 2.5 2.5 2.6 2.7
Bad debts 53.9 74.0 76.5 79.5 83.0
Abortive development costs 3.5 3.5 3.5 3.5 3.5
Property insurance 19.2 20.2 21.2 22.3 23.4
Water rates - payable 272.7 276.8 281.6 287.9 295.8
- less receivable -272.7 -276.8 -281.6 -287.9 -295.8
Maintenance - day to day 495.2 502.6 511.4 522.9 537.3
- voids 296.9 301.4 306.7 313.6 322.2
- electrical testing 55.0 55.8 56.8 58.1 59.7
- electrical repairs 200.0 40.4 41.0 41.8 42.7
- cyclical 89.7 83.2 82.6 83.7 80.7
- planned maintenance 174.0 179.8 182.9 186.8 293.4
Aids & adaptations 20.0 20.3 20.7 21.2 21.8
Service & support costs 841.1 867.1 887.5 889.3 894.0
LSE service costs 109.4 71.3 63.5 68.8 183.1
Mortgage interest payments 564.3 656.2 697.7 988.5 1,104.7
Property depreciation 1,941.2 2,054.6 2,049.7 2,092.0 2,169.5
Other expenditure 258.3 59.5 70.4 74.7 83.2
TOTAL EXPENDITURE 7,319.6 7,225.8 7,337.8 7,708.2 8,192.9
SURPLUS FOR THE YEAR 317.9 771.6 735.3 670.3 611.0Statement of Financial Year ending Year ending Year ending Year ending Year ending
Position from 1 April 31 Mar 22 31-Mar 23 31-Mar 24 31-Mar 25 31-Mar 26
2021
3
to 31 March 2026 £000’s £000’s £000’s £000’s £000’s
FIXED ASSETS
Intangible assets 216 171 132 94 80
Housing properties 95,892 99,415 103,562 107,781 111,840
Depreciation -36,318 -37,037 -38,308 -39,555 -39,983
Net housing properties 59,574 62,378 65,254 68,226 71,857
Other fixed assets 206 8 6 649 642
59,996 62,557 65,392 68,969 72,579
CURRENT ASSETS
Debtors 674 687 704 725 747
Cash and investments 1,455 3,908 1,367 8,151 4,958
2,129 4,595 2,071 8,876 5,705
CREDITORS
Amounts falling due within one year:
Housing loans -238 -423 -430 -438 -447
Other creditors -1,869 -1,741 -1,760 -1,784 -1,647
-2,107 -2,164 -2,190 -2,222 -2,094
NET CURRENT ASSETS 22 2,431 -119 6,654 3,611
TOTAL ASSETS less current liabilities 60,018 64,988 65,273 75,623 76,190
CREDITORS
Amounts falling due after more than one year:
Housing loans -13,779 -17,881 -17,340 -26,942 -26,534
Other creditors -21,173 -21,466 -21,754 -22,039 -22,444
-34,952 -39,347 -39,094 -48,981 -48,978
Defined benefit pension liability 22 2,431 -119 6,654 3,611
NET ASSETS 24,422 25,192 25,930 26,600 27,211
CAPITAL AND RESERVES
Accumulated surplus -238 -423 -430 -438 -447
Designated reserves -1,869 -1,741 -1,760 -1,784 -1,647
TOTAL RESERVES 24,422 25,192 25,930 26,600 27,211
Our office in Darlington (Bank Top House, Garbutt Square, Neasham Road, DL1 4DR)
is open between 8.30 am and 4.30pm Monday to Friday.
Free phone: 0800 0287428 | Email: info@railwayha.co.uk
Out of office hours, residents can report emergency repairs by using their emergency
pull cord or alarm if they have one; or by telephoning 0300 3034917
www.railwayha.co.uk
www.twitter.com/railwayha www.facebook.com/railwayhousingassociation
Registered Social Landlord: A1855 | Registered Charity: 1188450 | Member of the Housing Ombudsman ServiceYou can also read
