GHA crisis - stock transfer hits the buffers

Important info for anyone fighting stock transfer...

GHA Hits Crisis - from information revealed yesterday by a Glasgow Save Our Homes Campaign Meeting.

At 10AM this morning the board of the Glasgow Housing Association will meet for a crisis meeting. It is expected that by the end of November, the boss, Michael Lennon, of the GHA, will leave the organisation with a large payoff.

Two months ago the EU ruled against the British Government, that Housing Associations were private bodies. The EU thought that this was specious, and ruled that they were in fact public bodies. This had profound implactions for the future of housing stock transfer. Part of the justification for council housing sell-offs is the ability of Housing Associations to attract private investment, without this being counted as 'government borrowing', in which the UK is limited because the EU sets rules on the amount of public borrowing allowed by member states. This private money, so the spin goes, would then be pumped into our houses as never before. Of course this never happens, but that's how it's sold. They can no longer say this.

This ruling of course raised implications for the GHA, and I'm not entirely sure how it connects to this new development, but I think the GHA took this or that issue to the EU, or vice versa. Basically the end-up is that any contract carried out for the GHA (or any future stock transfer landlord), e.g. a lift maintenance programme, now has to be put out to tender across the EU, in a process that will take at least 16 months. The implactions for this are obvious - the Hutchie B flats in the Gorbals for example were designed by a French architecture firm on a model that works for housing in Algeria, where, as we all know, the climate is hot and arid. In the West of Scotland however they were uninhabitable due to dampness before they were even finished. This kind of thing will become more commonplace as contracts inevitably go to the lowest bidder.

The second part of the ruling was that the transfer of GHA management over to LHOs (local Housing Organisations), who were to become the embryos of the Housing Associations which were to take over the running of GHA stock after the secondary stage transfer was initiated, and who currently have some local autonomy for the running of GHA properties, is illegal. These LHOs therefore are to be disbanded, and all the farmed out staff of GHA to be brought back fully in house , in a more centralized structure. This also means that the LHO committees, which tenants sit on (and which enjoyed some planning and moral authority - their tendency to be filled with 'yes-men' notwithstanding), are to cease to exist. In fact the whole process of secondary stage transfer has been set back years. The GHA will not be able to get their planned 730 million pound bank consortium loan, their LHOs are illegal, and they will now have to put out to tender current contracted services hitherto mostly carried out by the city council.

This also means that the proposed stock transfers in Edinburgh, Inverclyde, Stirling, and Aberdeen will not be able to get access any private money, and will not be able to go down the route of secondary stage transfer. It's a farcical mess, but in lots of ways the situation is no better for tenants as this bureaucratic mess will mean that GHA in particular is going to be a guddle for years to come (and thus is yet more likely to be the thoroughly incompetant group of shysters we know they all are) and tenants will have to adjust, yet again, to a change in bureaucratic management proceedures.

It will lead to more confusion, continued underinvestment and even more unsuitable work being carried out on tenants houses.

Posted By

Nick Durie
Oct 28 2005 09:14

Share

Attached files

Comments

afraser
Oct 28 2005 09:41

Covered in Glasgow Herald [http://www.theherald.co.uk/news/49721.html] and Inside Housing [http://www.insidehousing.co.uk/default.aspx?contentid=1cfe96e2-a785-455e-ae2a-5c130d5014c7&id=1446799]

Actually I think is no big deal for the GHA - the LHOs are sham potemkin committees, GHA central runs everything. GHA was never going to give LHOs any power anyway.

But has got good press coverage, editoral in the Glasgow Herald [http://www.theherald.co.uk/features/49717.html] has come out against GHA, I think the first ever mainstream media to do so. Long overdue. Could make it possible to start an effective campaign against GHA.

Nick Durie
Oct 28 2005 09:59
Quote:
LHOs are sham potemkin committees

Fair dos

I did pretty say as much tho tongue :-

"which enjoyed some planning and moral authority - their tendency to be filled with 'yes-men' notwithstanding"

Altho you're right to emphasise it (I didn't there coz I got carried away with myself). I know only one independent member of an LHO and they've been trying to get rid of him constantly for years. I think it's a mistake to say they don't have some power but.

Quote:
Actually I think is no big deal for the GHA [...], GHA central runs everything. GHA was never going to give LHOs any power anyway.

Ay, but it was when it wound up but, which is the point I was making. I wasn't saying GHA had any real current plans to strengther LHO committees, which were scuppered by this ruling.

This isn't a terrible crisis for GHA - altho it makes them look like the useless, authoritarian incompetants they are, and it certainly means their financial plan, borrow 730 million fae the private sector, is now complete nonsense - but it is a quite major hurdle for secondary stage transfer, and it certainly massively weakens the case for stock transfer elsewhere.

meanoldman
Oct 28 2005 10:01
Quote:
Basically the end-up is that any contract carried out for the GHA (or any future stock transfer landlord), e.g. a lift maintenance programme, now has to be put out to tender across the EU, in a process that will take at least 16 months.

That's not true. Or at least it is true that it means that they won't be allowed to use the nationality of the bidding company as a criteria for awarding contracts but saying that that means every process will take at least 16 months is rubbish. In practice it'll mean very little change - very few German plumbers will apply for jobs repairing Edinburgh houses even if they are now allowed to do so, and there is definetly no requirement to wait for any length of time.

Nick Durie
Oct 28 2005 10:10
Quote:
saying that that means every process will take at least 16 months is rubbish

I took that at face value from something someone else quoted, and you are probably correct.

I've seen all sorts of pish from the GHA and right now it wouldn't take much for me to be entirely credulous if it was announced the next chief executive was to have four legs, hoofs and a tail and be called Eor.

meanoldman
Oct 28 2005 10:18

It is quite possible that things will take 16 months to get done, but that will be because of their incompetence, not this change in legal status.

afraser
Oct 28 2005 10:42
meanoldman wrote:
very few German plumbers will apply for jobs repairing Edinburgh houses even if they are now allowed to do so

Ah but plenty of giant German plumbing and FM firms will apply for big juicy contracts to (pretend to) repair Edinburgh houses. And that's what these rules are about. It means that each GHA to LHO contract has to go out to competitive tender, so that capitalist firms and (and this is the good bit) non capitalist firms can bid against the LHO provider, and the GHA has no choice but to take the lowest bidder who pass the vetting process (which tenants can influence) even if the lowest bidder is not a Labour Party crony. So "Queen's Cross Housing Association" loose out to "Nick Durie Enterprises Inc.". Of course GHA can never allow that to happen so will have to take the contracts back in house.

The Glasgow Herald might print an anti GHA letter related to their editorial today. Email it to letters-at-theherald.co.uk

afraser
Nov 4 2005 09:16

Could be that something is happening here:

Glasgow Herald 4th Nov wrote:
EUROPE'S largest social landlord has been warned by Jack McConnell that it has no grounds to take back management control of housing from its 75,000 tenants. The Glasgow Housing Association (GHA) is under growing pressure not to dilute householder control after the first minister warned it did not need to do so. It has also been told that it could be stripped of its powers by the regulator if the crisis is not resolved swiftly.

...

One Labour MSP added: "MSPs are going to come after the GHA if they don't deliver. They have to live in a world where they're accountable." MSPs also take a dim view of Michael Lennon, GHA chief executive, spending this week in Canada at a conference.

...

[http://www.theherald.co.uk/politics/50186.html]