Magazine article Public Finance

RSLs Are Warned against Urge to Merge

Magazine article Public Finance

RSLs Are Warned against Urge to Merge

Article excerpt

Housing associations have been warned not to rush into mergers solely to win grants to build new homes.

The Housing Corporation, which approves mergers of registered social landlords, is afraid that some are planning to merge to increase their prospects of inclusion in development programmes, which are being concentrated on larger associations.

Although merger activity has been relatively modest in the past few years, more RSLs are now considering group structures - partly to improve efficiency in line with the Gershon review.

One of the largest could involve Amicus and Horizon housing groups, both already among the corporation's preferred development partners, linking up to form a new RSL with more than 28,000 homes in the Southeast.

In a letter sent to the 600 largest RSLs on May 25, Housing Corporation chair Peter Dixon said associations must demonstrate that any merger would improve services, provide efficiency savings and lead to simple and straightforward governance.

'We do not have a preferred size or style of organisation, but we do have clear expectations about the outcomes of merger activity and in particular about the effect on organisational efficiency,' he said. …

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