Private and Confidential - Milton Keynes Council

HOUSING AUDIT INTERIM REPORT
‘I NEED A HOME’
VOIDS & LETTINGS
Final Distribution
MKC Director of Housing Services
MKC Assistant Director Of Housing
MKC Housing Needs Manager
MKC Lettings Manager
MKC Tenancy Services Manager
HBS Service Delivery Manager Housing Services
HBS Asset & Performance Manager
HBS Quantity Surveyor
HBS Senior Surveyor
Client Officer Housing Services
Lynda Baker – Audit Services Manager
Clint Horne – Principal Auditor
Jackie Haycock – Senior Auditor
Minashi Patel - Auditor
Mandip Rehal – Auditor
Nicholas Baines – Auditor
APRIL 2007

MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
1 INTRODUCTION
1.1 Background
EXECUTIVE SUMMARY
The Housing Service incorporates all tenant and domestic property services,
including council policy, provision to prospective tenants, the lettings process,
rental income, management of the Housing Revenue Account (HRA), housing
repairs and maintenance and improvements to the environment in which the
tenants live. This is the first interim report for an Internal Audit project that will
review all Housing Services.
The housing section has undergone a LEAN systems thinking review. This
has meant a redesign of the way the system works and providing choice
based lettings to our housing applicant. The new Systems Thinking approach
has introduced four “flows” – “I need a Home” and “Voids and Lettings” being
two of these flows.
Within the Housing Needs section the new method of working once fully
implemented will improve the service for our applicants. This should reduce
the time applicants are waiting to be housed.
Building Services includes void repairs, it was passed to HBS as part of the
Private Public Partnership (PPP) in January 2004. HBS entered a partnership
with Mitie in April 2006 to deliver responsive and routine repairs.
This interim report has been provided to enable progress to be made in
addressing issues identified prior to completion of all the audit work. There is
further work to be undertaken on the two flows “I need my home repaired” and
“I need my environment/tenancy improved” as well as rent accounts and the
Housing Revenue Account.
1.2 Objectives and Scope
Assurance
• Legislation – To confirm that legislative requirements are implemented
• Policy – To confirm that MKC policy meets legislative requirements and
is implemented
• Budget – To confirm appropriate financial management
Improvement
• The quality of the service will be considered from the customer’s
perspective to ensure that it is:
o Effective – Does it deliver what the customer’s need?
o Efficient – What are the significant waste steps in the service
flow?
o Economic – is it the best price?
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
Client’s requests
• Review the new system against the previous system.
• Confirm Housing/Lettings Officers are allocating properties to
applicants needs.
2 AUDIT OPINION
Limited Assurance - Controls exist but inconsistency in application. Some
risk of loss, fraud, impropriety or damage to reputation.
3 CONCLUSIONS
3.1 Assurance
Legislation – No evidence to date of any breaches of legislation.
Policy – Systems thinking continually challenges policy and therefore this will
continue to evolve. However, it is important that policy changes are not made
inadvertently or unknowingly.
Budget – Housing Options budgets are satisfactory. Routine audit work will
continue to look at the repairs budget and reconciliation between Mitie and
HBS.
3.2 Improvement
Housing Services are to be complimented for undertaking the systems
thinking approach in their service. There has certainly been good progress in
the void repairs work and this will continue in a cycle of continuous
improvement. This approach is challenging, it involves trialling new ways of
working and it is recognised that there is still a long way to go to see this
working effectively in the Housing Service as a whole. The main issues that
need addressing are:
• There are two systems working concurrently (old and new) and these
conflict.
• Continued efforts to ensure all housing staff are working with a common
purpose and striving to improve service to customers.
• Some properties are remaining vacant for excessive periods at ‘Ready
to Let’ stage.
4 WAY FORWARD
All recommendations are in the Management Action Plan (Page 5). Positive
findings are shown in section 5, overleaf.
4.1 The trialling of the new way of working has flushed out many issues that can
now be incorporated into the new Allocation Policy and allow this to work more
effectively. The finalisation of this document with member approval should
help to address several of the issues identified in the report.
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
4.2 Properties are to be brought to a “Safe, sanitary & secure” standard which
then allows tenants to view the property and be housed more quickly. This will
also ensure excessive cost is not expended on properties that remain hard-tolet.
4.3 Void Tracker will be phased out to eliminate duplication of effort and a costbenefit
analysis will be undertaken to evaluate the extent to which the housing
database (SX3) should be developed in order to make use of it’s potential.
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
5 POSITIVE FINDINGS
FINDINGS SUMMARY
5.1 The use of Bed and Breakfast accommodation has dropped by 54% over the
last three years.
5.2 The Housing Needs section has made changes to improve the service by
implementing a new way of working. This includes giving the customer a
choice of properties working towards Choice Based Letting by 2010.
5.3 A pilot scheme is being undertaken at present to improve the way of working,
for example West Bletchley Housing Office has a Rent First officer working
with the Estate Management Officer (EMO) during tenancy sign-up process.
5.4 Mitie and HBS are working closely together; there is a positive and motivating
environment, a joint aim and accepted responsibility to meet customer’s needs
as effectively as possible.
5.5 There are regular weekly reviews of capability charts to investigate lengthy
voids works and solve any delays for future works. Void turnaround times
have decreased from 42 to 18 days (measured on the Mitie system). This
includes major works that characteristically have longer repair periods and
hostel rooms with very short turnaround times.
5.6 HBS have been very receptive to audit findings and two improvements are
already being implemented:
• The Void Post Inspection Form has been redesigned to provide better
assurance and accountability for void works completed.
• The method to record Hostels on SX3 is being investigated and a
consistent approach is being implemented to improve property
management and ensure annual gas services are implemented.
5.7 At the Housing offices all property keys were accounted for. Decoration
vouchers were also accounted for and the standard procedures and recording
method has now been implemented at all Housing Offices.
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
The issues discussed have been categorised on the following basis:
MANAGEMENT ACTION PLAN
Essential – Action is required to address a weakness that fundamentally undermines the control/objective of that system.
Important – Action is required to address weaknesses that seriously undermine the control/objective of that system.
Standard – Management need to take action to address weaknesses that may undermine system control/objective.
“I NEED A HOME”
Ref Findings Risk/ Implication Agreed Actions/ Improvement Management
Comments
1
2
NOT PRESENTING A CO-ORDINATED APPROACH.
• At present there are old and new ways of working which are in
conflict.
• Communication about the new way of working is perceived by
some staff to be poor.
• Staff indicated that issues have not been resolved.
THE HOUSING OPTIONS TEAM.
• Applicants contacting the team by telephone wait 4 weeks for a
Housing Options interview.
• Each member of the team holds their own workload; if they are
absent the cases are left until they return.
Customers not
treated equitably.
Team morale is
lowered by the
different systems.
Essential
The new Allocation Policy is going to
Policy Development Committee in
June.
After a statutory period of consultation
there will be one way of working.
Interviews may not Essential
be held at the
Agreed for more resources to do deal
earliest possible
with the backlog list.
date.
Delays in housing
Applicants.
Rota to be reviewed to place more
staff at the front end.
Short-term solution, staff will be asked
to cover absent staffs work until new
Housing module is implemented.
Agreed
Agreed
Manager
Responsible &
Target Date
Housing Needs
Manager
September 2007
Lettings
Manager
May 2007
Housing Needs
Manager
Software
decision by May
2007
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
Ref Findings Risk/ Implication Agreed Actions/ Improvement Management
Comments
3
4
• Some tenancies are not being created at initial occupation Delayed rental Pilot scheme for Estate Management
therefore rent accounts are not being set up. During this period it income.
would be difficult to monitor rental income.
Officers to be able to set up tenancies.
• The housing options cases are reviewed by the Senior Housing
Needs Advisor after they have been closed.
PROPERTY POOL
• Properties are being allocated by the Lettings Team before the
Options Team.
• The Property Pool is not specific to the applicants needs.
• The Housing Options Officers do not show the applicants a ‘live’
version.
Unnecessary work.
Customers are not
treated equitably.
Inefficient practice
Two staff may offer
one property at the
same time.
A sample of closed files to be checked.
Essential
Training of the void process to be
given to all members of the Housing
Options Team.
System and report to be refined.
Use of wireless tablets during
interviews.
POLICY
Important
• Relationship to staff/councillors are identified in the application MKC and individual This will be written into the new
forms however there is no written policy in place to protect the officers could be Allocations Policy.
Council from accusations of bias.
accused of nepotism.
Agreed
Agreed
Manager
Responsible &
Target Date
Lettings
Manager
May 2007
Housing Needs
Manager
May 2007
Lettings
Manager
May 2007
Housing Needs
Manager
Decision by May
2007
Housing Needs
Manager.
September 2007
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
Ref Findings Risk/ Implication Agreed Actions/ Improvement Management
Comments
5
MEASURES AT PRESENT ARE INCORRECTLY RECORDED.
• The measurement of the ‘I need a home’ flow starts at Options
interview not when the applicant first contacts the section,
therefore not measuring the full end-to-end time.
• Measures are not integral to the work Reported measurements
are incorrect, negative figures are being shown for end-to-end
times.
Not showing true end Important
to end measures The system is to be tested to see if
from the customers true end-to-end measure can be
perspective.
achieved.
Not using measures
as a means to learn
and improve.
Will ensure measures are integral to
the work
Agreed
Manager
Responsible &
Target Date
Senior
Homeless
Officer
End April 2007
Assistant
Director Of
Housing
May 2007
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
Ref
“Voids & Lettings”
6 “PUSH” SYSTEM OF VOID MANAGEMENT
Findings Risk/ Implication Agreed Actions/ Improvement Management
Comments
• Properties are vacant and “Ready-to-Let” for considerable
periods of time.
• More void properties were found to be “Ready to Let” than at any
other stage in the void process.
• Money is spent on “Hard-to-Let” properties that then remain
vacant for longer periods, sometimes incurring damage that
could have been avoided or minimised if the property had been
occupied.
• In some cases the “Notice to Quit” period is less than 28 days.
Loss of rental
income.
Increased costs for
Bed and Breakfast
and temporary
accommodation.
Increased risk and
costs of vandalism.
Essential
Properties will be brought to a “Safe,
sanitary, secure” standard before any
decision to implement additional
works.
Additional possible works identified by
HBS/Mitie can be agreed with
incoming tenant as a negotiation point
by EMOs and can then be completed
during their occupation.
Investigate reasons for visibility
periods and consider ways to increase.
Continue to implement works during
end of tenancy period where possible.
Agreed.
Manager
Responsible &
Target Date
Asset Manager
(HBS)
In place from
April 2007
Asset Manager
and Assistant
Director of
Housing
April 2007
Assistant
Director of
Housing (MKC)
Ongoing
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
Ref
7 ALLOCATION OF PROPERTIES
Findings Risk/ Implication Agreed Actions/ Improvement Management
Comments
• The incoming tenant is not identified at an early stage, Possible cost
particularly for Old Age Pensioner (OAP), “Sensitive lets” and reductions for repairs
“Hard-to-let” properties, therefore:
are not realised.
• It is not possible to implement Housing Health and Safety
Rating System inspections.
• It is not possible to agree required works with the incoming
tenant (may reduce works/costs, may be able to do work
while tenant occupies property).
• The average days from “Ready To Let” until commencement of
tenancy during the first 9 months of 2006 was 27. This has been
reduced to 20 days during the past 6 months but continues to be
excessive.
• Tenancies always start on Mondays.
• There are differences of opinion between void works
operatives/contractors and Housing Offices regarding access to
properties for prospective tenants to view. (Internal Audit
recognises that a change to alarms and key safes should help to
resolve this).
Properties are
remaining vacant,
therefore vulnerable.
Batching/bottleneck
causing
administrative
inefficiencies.
Not housing
applicants at the
earliest opportunity.
Loss of rental
income.
Essential
Issue addressed in Action 6
Investigate legal, benefits and rent
issues and implications of changes.
Investigate transfer issues.
Clarify and improve communications.
Agreed
Manager
Responsible &
Target Date
Rents and
Incomes
Manager (MKC)
to work with
Internal Audit
May 2007
Senior Surveyor
(HBS)
April 2007
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MKC INTERNAL AUDIT SERVICE HOUSING AUDIT INTERIM REPORT
Ref
8 VOID TRACKER
Findings Risk/ Implication Agreed Actions/ Improvement Management
Comments
The Void Tracker was a trial system to identify information required
in terms of data management and visibility.
• The Void Tracker system results in officers having to duplicate
their work. Manual input of Pre End Of Tenancy information is
not consistent – void works lead-time is increased.
• Void Tracker is currently located on a server in the Mitie offices.
Internal Audit recognises there have been difficulties to get IT to
“host”.
• The Void Tracker is currently unable to provide reports for
management information.
9 SX3/MANAGEMENT OF PROPERTIES
• Not all properties having rewire/new central heating had been re
classified as “Major”.
• SAP does not link with SX3.
• SX3 is not currently being used to its potential as main housing
management system.
• Quarterly manual reconciliation between SX3 and SAP.
• Values for recharge works not properly allocated on SX3.
Incorrect information
may be used to
make decisions
about workflow and
provision of
properties to
prospective tenants.
Best Value
Performance
Indicators may be
inaccurate.
Budgets and
accruals are
inaccurate on SX3.
Incorrect budgets
may be used,
additional costs
through payment of
recall works, loss of
potential income.
Essential
Phase out Void Tracker and ensure
information required is included on
SX3 and that partners can access and
update the system.
Important
Voids repairs team to change
classification on SX3.
Review of use of SX3, assess
appropriate time to address the issues.
Cost benefit analysis for interface
between SAP and SX3, also
considering warranties.
New recharge system being
introduced based on National Housing
Federation schedule.
Agreed
End of year
reconciliation
ensures BVPIs
are correct.
Now have
interface
between Mitie
and SX3.
NB Any cost implications arising from implementation of the recommendations by HBS must be agreed in advance with the appropriate Client Officer and the Partnership Delivery Manager.
Manager
Responsible &
Target Date
Lettings
Manager
June 2007
Senior Surveyor
(HBS)
April 2007
Strategy and
Performance
Manager
September 2007
Service Delivery
Manager (HBS)
September 2007
Rents and
Incomes
Manager
June 2007
AUDIT REPORT – E535 10 APRIL 2007