Value for Money (VfM)
How we spend your rent money:
As a not-for-profit charity, income that we collect from rents is invested back into the homes and services we provide for our customers.
Here are some ways that we have been saving money and reducing costs:
- Using our own kitchen fitters has meant that we have reduced the cost of installing a kitchen.
- Reviewing our external decoration programme to tackling properties where a fabric repair is necessary rather than just an aesthetic reasons
- Working with our suppliers to reduce costs and reviewing our product range, substituting more expensive products with ones that have similar performance, but cost less.
- Where possible, putting agreements in place with suppliers to freeze costs for the duration of our contract.
- We have agreed stock levels in our local branch, ensuring that the most in demand products are always available for us to repair customers’ homes.
- Doing more of our legal work in-house, which saves money on fees.
- Switching to a new print and design agency who offers better value for money.
Regulator of Social Housing Key Measures 2024
As a community landlord, Value for Money (VfM) is a key driver and is integral to our culture and everything that we do. We work closely with our Customer Board Partnership and Scrutiny Panel to deliver VfM targets to meet the objectives in our Corporate Plan. We aim to deliver a high-quality service as efficiently and effectively as we can.
As a housing provider, we are subject to regulation put in place by our regulator, The Regulator of Social Housing (RSH). They have identified seven key measures to see how well we are performing.
The RSH releases the sector median, which is the industry average across all providers from the previous year. This gives landlords like us the opportunity to show how we measure up against the housing sector, as well as be able to set our own targets against these averages in an informed way. The sector median is based on an average of performance from the previous year, so you will note below that these have earlier dates than our own targets and actual performance data, which is for the year from April 2023 to March 2024.
Below, we have explained each of the seven measures, given the sector median for the previous year, outlined our own target set by our Board this year and given information on whether we have achieved each of the targets set against them.
Measure 1: Headline Social Housing Cost per unit
The Headline Social Housing Cost is the cost of managing and maintaining one property. This is worked out by adding all of our costs across social housing and dividing them by the number of properties we have.
| Sector Median (2022/2023) | £4,586 |
| NDH Target (2023/2024) | £3,871 |
| NDH Actual (2023/2024) | £5,450 |
Measure 2: New Supply
The New Supply measure is the number of new properties we have built in the year, but as a percentage measure across all our properties. So, for example, if we had 100 properties and we built 1 new property, the percentage value would be 1%.
This measure is broken into two – one for social housing and one for non-social housing..
Social Housing
| Sector Median (2022/2023) | 1.3% |
| NDH Target (2023/2024) | 1% |
| NDH Actual (2023/2024) | 0.54% |
Non-social Housing
| Sector Median (2022/2023) | 0.0% |
| NDH Target (2023/2024) | 0.9% |
| NDH Actual (2023/2024) | 0.29% |
Measure 3: Reinvestment
The Reinvestment measure is the percentage of investment that we put back into building new homes or maintaining our existing homes. The percentage comes from calculating the value against the total value of all the homes we own. So, for example, if we said our entire housing stock was valued at £100 and we spent £1 on either building or maintaining homes, the percentage value would be 1%.
| Sector Median (2022/2023) | 6.7% |
| NDH Target (2023/2024) | 3.8% |
| NDH Actual (2023/2024) | 5.9% |
Measure 4: Gearing
Gearing is the amount of debt we have as a company. The percentage comes from calculating the total value of our homes compared to how much is debt. So, for example, if we said all our housing stock was valued at £100 and we had £50 in debts, the percentage value would be 50%.
| Sector Median (2022/2023) | 45.3% |
| NDH Target (2023/2024) | 59% |
| NDH Actual (2023/2024) | 60.1% |
Measure 5: Earnings before interest, tax, depreciation and amortisation - major repairs included (EBITDA MRI)
This measure is to show how much financial capacity we have to invest as a company. For example, if we said as a company we had £100, but £50 of that was in the value of our homes, we would have £50 cash value to invest in services, so the percentage value would be 50%.
| Sector Median (2022/2023) | 128% |
| NDH Target (2023/2024) | 137.5% |
| NDH Actual (2023/2024) | 23% |
Measure 6: Operating Margin
The Operating Margin measure is here to show a company’s surplus over the year. The surplus is the amount of money made that hasn't been spent after all the expenses have been accounted for. This would most commonly be referred to as profit but, as we are a not-for-profit company and we make none, this is referred to as surplus which is then reinvested in the next year's finances. The percentage is based on the total income and how much was spent. So, for example, if we had £100 income from rent money and funding in the year, and we spent £75 in the year, our percentage value of surplus would be 25%.
This measure is broken into two - one for social housing and one for overall performance.
Social Housing
| Sector Median (2022/2023) | 19.8% |
| NDH Target (2023/2024) | 23.2% |
| NDH Actual (2023/2024) | 18.9% |
Overall
| Sector Median (2022/2023) | 18.2% |
| NDH Target (2023/2024) | 20.9% |
| NDH Actual (2023/2024) | 18.2% |
Measure 7: Return on Capital Employed
This measures how efficiently we are investing our capital resources. This measure is about how financially viable we are and how well we invest our resources and assets.
| Sector Median (2022/2023) | 2.8% |
| NDH Target (2023/2024) | 3.1% |
| NDH Actual (2023/2024) | 2.8% |
