A small for-profit provider has been found to be non-compliant with regulatory standards

On 9th September, the RSH issued a Regulatory Judgement which concluded that Keystage CIC was not delivering the required outcomes of the Governance and Financial Viability Standard.  Keystage, which owns 34 supported housing and 14 general needs social homes plus a portfolio of 196 non-social homes, had failed to understand and manage the impact of its for-profit RP status on claiming higher levels of housing benefit related to supported housing. This led to a lower than forecast rental income impacting the ability to deliver its financial plan.  The increased obligations created by the additional debt raised to complete the developments had put social housing assets at undue risk. Keystage C.I.C’s business planning, risk and control framework had not ensured that there was always access to sufficient liquidity or compliance with loan covenants, leaving the organisation reliant on the goodwill of its funders and creditors.

Despite the implementation of stringent cash flow management processes and forecasting by the recently appointed interim leadership, the organisation was considered unable to continue as an independent landlord.  A timeline had now been set for Keystage to merge with another RP, subject to tenant consultation and due diligence.