Thank you, convener. I thank the committee for inviting us along to present the SHR’s annual report and accounts for 2016-17. As you will know, I took over from Mrs Kay Blair as the chair of the Scottish Housing Regulator in July. We had a good and effective handover period, and I stepped in as the chair from August. I am therefore a relatively new boy. I enjoyed a great handover and was pleased to find a well-run and effective regulator with a high-quality board that had a very clear focus on protecting the interests of tenants and service users. That is important—after all, that is what we are about.
I am delighted to present to the committee the annual report and accounts for 2016-17, and I would like to highlight a few things. The first is the SHR’s work to empower tenants and to draw landlords’ attention to issues, such as rent affordability, that are important to tenants. Secondly, the SHR has highlighted positive practice to help landlords to develop new homes sustainably and thereby contribute to the Scottish Government’s affordable housing target. Thirdly, the SHR has worked hard to maintain the confidence of those who invest and lend to the sector, which is vital. The SHR has also used the statutory intervention powers that Parliament has given it to protect the interests of tenants and, of course, the sector’s good reputation.
We are pleased to take any questions that you might have on the annual report. First, however, I would like to highlight some more current and emerging issues for the regulator. We have started a review of our regulatory framework—in other words, the framework around which we regulate. It was published in 2012 and, at the time, we committed to reviewing it as we moved forward. Right now, we are generating ideas with our stakeholders. In January, we will publish a discussion paper that will be followed by a formal proposal and consultation in the second half of 2018.
That work is timely, as it will allow us to reflect on our experiences, what we have learned over the past five years and the changes in the operating context for social landlords that have taken place over that time. We want to build on the successes of our framework as well as strengthen our approach and adjust in response to new challenges. We know that social landlords continue to perform well across almost all the charter’s standards and outcomes; indeed, last year, 14 out of 16 outcomes improved. We also know that most are managing their resources to ensure their financial wellbeing.
Nevertheless, we are actively engaging with one in eight registered social landlords, primarily on serious governance issues, and over the past three years we have had to use our statutory intervention powers with seven landlords. Throughout the review, therefore, we want to look at what more we—and, perhaps more important, the boards of social landlords themselves—can do before we need to become involved in a situation. We will also review and take account of the changes that are likely to be introduced by the Housing (Amendment) (Scotland) Bill, although I understand that we will discuss that further when we meet the committee again on 29 November.
I will quickly highlight some of the early themes that are emerging from our discussions with stakeholders, which the committee might be interested in hearing about. They include self-assessment against the regulatory standards, strong internal audit, active risk management and the positive use of whistleblowing in organisations. Given that tenants remain at the heart of our work, the committee will not be surprised to hear that a strong emerging theme of our early discussions is tenant safety. We are actively working to promote that agenda, and we are pleased to find that it is very much at the forefront of our stakeholders’ current agendas, too. We will keep the committee updated as we progress through the review.
I also want to mention homelessness, which I know is close to the heart of this committee, in particular. Like you, we appreciate the issue’s complexity and welcome its prominence in the recent programme for government. We are committed to doing all that we can within the limitations of our remit and to using all our influence to drive the changes that we all want to be made. I imagine that members might ask us some questions on homelessness later in the meeting.
The final issue that I want to highlight is rent affordability. The committee will be aware that inflation has now hit 3 per cent—indeed, the figures for October were announced yesterday—and changes to the welfare system present real difficulties for many tenants. Tenants are raising with us their concerns about future rent increases, and we are looking to social landlords to understand what is affordable for their tenants and to consider that in determining rent levels. That will mean landlords giving tenants genuine options and choices during rent consultations, discussing with them the balance between value for money and service levels and demonstrating to tenants and to us how they are taking tenants’ views into account.
I do not want to hog the floor, convener—I wanted to keep my remarks short—so I will hand back to you. Thank you for the opportunity to meet the committee and present our report. I simply wanted to cover a few issues that are at the top of my and the SHR’s agenda right now.