TIDM57UT
RNS Number : 4177L
Grand Union Group Funding PLC
10 September 2021
Grand Union Housing Group
Annual report and financial statements
for the year ended 31 March 2021
For full details of the announcement and a copy of the detailed
financial statements for the year ended 31 March 2021 please access
the following link:
https://www.guhg.co.uk/investor-relations/financial-statements-2020-21/
Grand Union Housing Group Limited Registered office: K2, Timbold
Drive, Kents Hill, Milton Keynes, Bucks MK7 6BZ Grand Union Housing
Group Limited is a Charitable Community Benefit Society registered
in England & Wales No. 7853, regulated by the Regulator of
Social Housing No. 5060, and is a member of the National Housing
Federation.
Grand Union Housing Group
Contents
The Board, Executive Officers and Advisors
1
Statement from the Chair and Group Chief Executive 2 - 4
Staff Engagement Statement
5 - 6
The year at a glance
7 - 8
Strategic Report
9 - 43
Board Report 44 - 45
Independent Auditor's Report
46 - 49
Consolidated Statement of Comprehensive Income 50
Association Statement of Comprehensive Income 51
Consolidated Statement of Financial Position 52
Association Statement of Financial Position
53
Consolidated Statement of Changes in Reserves 54
Association Statement of Changes in Reserves 55
Consolidated Statement of Cash Flows
56
Notes to the Financial Statements 57 - 91
Grand Union Housing Group
The Board, Executive Officers and Advisors
Chair
James Macmillan, Independent,
Board Members
Gillian Walton, Independent Vice Chair (Appointed Senior
Independent Director 2 June 2020, resigned as Vice Chair 1 February
2021)
Richard Broomfield, Independent
Kami Nuttall, Independent
John Edwards, Independent
Vanessa Connolly, Independent (Resigned 30 June 2021)
Nicola Ewen, Independent
Brent O'Halloran, Independent
Peter Fielder, Independent
Michael Pattinson, Independent (Resigned 16 June 2021)
Dave Willis (Re-appointed co-optee 25 May 2021, appointed as
full member 27 July 2021)
Company Secretary
Anne-Marie Huff (Resigned 26 January 2021)
Mandy Hopkins (Appointed 26 January 2021)
Executive Officers
Aileen Evans, Group Chief Executive
Phil Hardy, Executive Director of Operations
Mona Shah, Executive Director of Finance & Business
Services
Registered Office K2
Timbold Drive
Kents Hill
Milton Keynes
Bucks
MK7 6BZ
Solicitors EMW Law Devonshires
Perrin Myddelton Wright Hassall
Trowers & Hamlins
Funders NatWest Bank plc
Royal Bank of Scotland plc
Santander Plc
Newcastle Building Society
Nationwide Building Society
Bankers NatWest Bank plc
Auditors Beever and Struthers (External) KPMG (Internal)
Valuers Savills plc Avison Young
Berrys
Registered under the Co-operative and Community Benefit
Societies Act 2014 No. 7853 and with the Regulator of Social
Housing No. 5060
Grand Union Housing Group
Statement from the Chair and Group Chief Executive
Despite what has been an incredibly challenging year for us all,
where the coronavirus pandemic has affected the way we live and
work, the rollout of the vaccine is giving some hope that some
normality will resume as the year progresses.
During the last 12 months, our colleagues have risen to the
challenge of providing services in different ways with compassion
and skill and we are extremely proud of the commitment they've
demonstrated. We've also worked to support our customers and our
partners - contractors, local authorities and community groups. We
are continually inspired by the ability of colleagues across the
group to consistently turn words into actions and this 'can-do'
approach has exemplified our approach to the pandemic.
We have continued to focus on the wellbeing of our customers and
colleagues - we have an open culture ensuring that there is no
stigma in talking about mental health, and our customer wellbeing
and support service has delivered a range of initiatives during the
year, such as working with mental health charity Mind BLMK to
create a psychologist led programme for those who hoard, contacting
our customers whose gas has been capped and helping them to get
back onto supply, and working with the police and community safety
partnerships on detecting cuckooing and county lines networks. The
service has received over 490 referrals in the last year and
continues to support our most vulnerable customers across a wide
range of issues .
Our financial inclusion team has been busy - especially in
supporting many of the 1,000 additional Grand Union customers in
navigating the benefit system, many for the first time. We have
increased the resource available to our customers experiencing
challenge and hardship; we are committed to working together with
our customers and a range of partners to help people live full
lives in the homes we provide. We recognise that what most of our
customers want from us is a well-maintained home at a reasonable
rent and a prompt and high-quality repairs service. Where customers
do need it, then extra support is available at the right time, in
the right way for as long as required.
We have really appreciated the value of clear and regular
communication with both our customers and our colleagues during the
last year - we have followed government guidelines and have ensured
that both our colleagues and our customers are safe by using
quality PPE and adopting a range of controls to make sure we are
COVID-19 secure.
Our ability to work in a truly agile way was embedded before the
pandemic struck - our investment in IT infrastructure, the kit our
colleagues use, software and training paid dividends and, during
the year, we were able to move to contactless lettings and
implemented a new customer portal. Our customers tested the portal
prior to it going live and we made important changes to the way it
worked as a result of their feedback. Our IT team have provided
expert support to a fully remote working team and have continued to
make major strides in transforming our digital offer - not only for
our customers, but for our colleagues too.
Our customers are at the heart of everything we do. That's an
easy thing to say but we have made real efforts to improve the
service our customers receive - we learn from the considerable
amount of feedback we receive from Rant & Rave, our customer
portal, from social media and online reviews. We are serious about
ensuring we put things right when they go wrong too and set up our
Resolutions team to ensure that negative feedback is followed up
and that complaints are resolved quickly. Our average complaint
resolution time is 6.07 days and having adopted the Housing
Ombudsman Complaints handling code, we are focussed on ensuring
that we learn and improve from every interaction with our
customers.
We have undertaken several efficiency reviews during the year
and are beginning to see the benefits of this, for example empty
homes turnaround time has decreased to 15 days. Further reviews
will be undertaken as the year progresses in order that we use our
resources effectively to deliver better services that represent
value for money.
We carried out a major restructure during the year to implement
our target operating model. We have aligned our processes,
technology and people to further ensure that we can properly
deliver our values of being driven to do more for our customers,
that we deliver on our promises and that we're in it together.
As part of this restructure we created a Domestic Abuse &
Safeguarding team - we're also opening our fourth domestic abuse
refuge in 2021/22. We are in the process of working towards the
Domestic Abuse Housing Alliance accreditation and keeping the
customers we support safe, whether they are in a refuge or not, is
a key priority for us.
We also insourced our responsive maintenance and voids services.
There were many reasons for this but the desire to fully own our
relationships with our customers over the single most important
service we provide was a central factor. We expect to improve the
quality of the service and deliver savings as a result. Over the
year we spent GBP26.83m on repairing, improving and maintaining our
stock and in addition, our in-house Occupational Therapy service
supported customers by delivering 543 adaptations and the
facilitation of 126 Disabled Facility Grants (DFGs) through our
local authority partners.
During the year we began the implementation of a suite of new
strategies that will deliver the ambitions outlined in our
corporate plan, Further together, which we launched last year. Our
new Strategic Asset Management Strategy focusses on building
safety, carbon reduction and keeping our homes in good condition.
Our Environmental Sustainability Strategy will ensure that we are
making a positive impact through our sustainability performance, by
promoting a culture of sustainability with our colleagues and
customers. We are taking our responsibilities seriously and are
committed to becoming carbon zero by 2050. Our Sustainable Rents
Strategy sets our approach to the rents we will charge, with a
focus on genuine affordability, and our New Business and
Development Strategy will see us build 400 new homes a year. Our
development programme saw us build 111 homes this year - delays due
to the pandemic prevented us from achieving our planned programme.
We claimed GBP5.7m in Homes England grant during the year and our
plans for the next year will see us bid into the new Affordable
Homes Programme 2021-2026.
We are on site this year with our largest development ever; an
extra care scheme at Sorrel Way in Biggleswade which will provide
93 high quality homes for older people. As well as a housing
crisis, we are experiencing a social care crisis, and good quality
accommodation where people can access support when they need it is
vital in Grand Union contributing to solving these twin issues.
During the year we were privileged to be among the first
signatories to Harry's Pledge, a national campaign spearheaded by
Longhurst Group to inspire change in the way society values carers,
and to commit to the building of more accessible homes and public
buildings. As part of our commitment to this, we surveyed our
colleagues to better understand those who had caring
responsibilities and have worked on an individual basis to provide
support to them where necessary.
Following the Black Lives Matter protests in the wake of the
unlawful death of George Floyd, we have worked during the year to
develop and to begin implementing our new Belonging Strategy, to
counter racism in the workplace and adopt a new approach to
diversity and inclusion, stemming from the belief that our
customers and our colleagues all deserve a place where they can
belong. Our implementation of this will see us raise awareness of
diversity related issues, especially around the issue of white
privilege. We will work to challenge prejudice and become allies to
those who face it. We have made a start by measuring our ethnic pay
gap which was 0% in 2020 and is now -3.75%, with a median gap of
-3.63% for the year ended March 2021, which means we pay People of
the Global Majority (PGM) more than those from white backgrounds.
We will monitor this annually alongside our gender pay gap, which
this year fell to 3.10%, with a median gap of -4.74%, meaning our
median pay is higher for women than it is for men, and will develop
a suite of metrics so that we can measure and be held accountable
for our performance. It is not just about the questions that our
monitoring of the data will raise - we will work hard to make sure
our culture is one where we embrace diversity fully and truly
create a sense of belonging.
We are proud of the culture at Grand Union; we are fast paced
and yet thorough and have a kind, collaborative culture where
people feel valued and are focussed on delivering great customer
service. Our culture is important - it's part of what drives our
desire to do our best for those we serve and continually improve
and innovate in the way that we do this.
We are pleased to have become early adopters of the industry led
Sustainability Reporting Standard, designed to unlock institutional
investment to help tackle the UK's deepening housing crisis and
reduce our carbon footprint. W e remain financially strong; we
delivered an operating margin of 28% and we retained our G1/V1
rating from the Regulator of Social Housing. This financial
strength will enable us to keep developing new sites so we can
serve both our existing and future customers with a range of
tenures, and also provide a range of additional services to support
our more vulnerable customers.
We are well placed to deliver the challenges of the Social
Housing White Paper and are focussed on being fully compliant by
the time the legislation reaches the statute book.
We are proud of the achievements during the last year, despite
the significant challenge of the pandemic. We know we still need to
drive continual improvement in our services, and we will be
unwavering in our focus on this. We have an important role to play
in the recovery and we will continue to work hard to deserve the
trust of our customers, colleagues, and partners.
Good governance is important to us and from 2021, we have
adopted the National Housing Federation's (NHF) 2020 Code of
Governance that will see our Board members moving from maximum
terms of nine years to maximum terms of six years. We are in the
process of drawing up a transition plan that ensures we use the
flexibility in the Code in planning both the succession and
continuity of the Board making sure that we keep the interests of
Grand Union paramount. It's our aim to achieve this in an efficient
and smooth way.
The pandemic has highlighted the structural inequality that
exists in our society and this has been in the forefront of our
minds throughout the past year. Our values have guided the
decisions we made and our responses. We are well placed to meet the
challenges we continue to face with an agile and committed team and
we appreciate all their efforts this year.
Our Board and Committee members have shown great commitment over
the last year and our thanks go to them for their expertise and
support.
James Macmillan Aileen Evans
Chair Group Chief Executive
Grand Union Housing Group
Staff Engagement Statement
Colleague engagement became more important than ever before in
2020/21 as COVID-19 forced us all to work from home for large
periods of time.
Ensuring that colleagues were kept informed of key issues, and
matters affecting them, was critical and we used a number of
different methods to do this.
Staying in touch
With colleagues and teams all working virtually, we used GUS,
our intranet, to engage with colleagues as much as possible. In
2020/21, an average of 86% of colleagues regularly used GUS. During
the year, 845 different news, features and information articles
were posted on it and were viewed over 138,800 times.
The Executive team provided colleagues with regular updates on
GUS in a number of different ways, ranging from more formal
information posts about COVID-19 updates and external issues that
may affect the business, to more personal video updates recorded by
Aileen Evans, our Chief Executive. We also started regularly
posting good news and achievements from across the business on GUS
so that colleagues could stay engaged with sections of the business
they may not have regular contact with.
We also increased the use of discussion groups on GUS, setting
up a number throughout the year to keep all colleagues engaged and
informed. The 'Team GUHG' discussion group was set up for
colleagues to discuss all things to do with the business, ask
questions and stay in touch with colleagues. We also set up more
informal groups, including one to share pictures of our pets, one
to give hints and tips for home schooling and then another called
the 'wall of kindness'. This was where colleagues could share
examples of kindness they had experienced themselves, or where they
had done a kind deed for others.
Our Joint Consultative Committee (JCC) was able to continue,
meeting virtually every two months. JCC is a forum between Grand
Union as the employer and its colleagues and aims to help develop
the organisation's interests, ensuring colleagues are treated
fairly, and in accordance with equality and diversity legislation,
to achieve the highest possible standards within the resources
available.
Helping colleagues during lockdown
With colleagues working remotely, it was important that we made
sure they were okay and had everything they needed to perform their
roles.
Colleagues were invited to complete a survey in May 2020, to
help us understand how they were coping during the first lockdown
and find out what further support could be provided. There was a
high response to the survey and the results showed that colleagues
felt communications during the first lockdown had been great.
We also introduced Mental Health First Aiders in July 2020.
These are nine colleagues and a Board member from across the
organisation who attended a mental health first aid course and are
available as a confidante for colleagues or alternatively direct
them to sources of support. They posted regular updates on GUS
regarding various mental health topics and events and have
supported a number of colleagues throughout the year.
Staying engaged during a restructure
In the summer of 2020, we began a restructure of the operational
side of the organisation, which would bring it more in line with
our target operating model. This was introduced as a live event on
Microsoft Teams, which was attended virtually by 150 colleagues. We
also provided a recording for those who were not able to view it
live.
We kept colleagues affected by the restructures engaged
throughout, from the initial launch right through to consultation.
This included pre-recorded videos from Directors talking through
the impact to their business area, consultation packs, live
question and answer sessions with Directors, and finally individual
meetings with their Director and HR Business Partner to discuss how
the restructure would affect them.
Going further together
On 1 July 2020 we launched Further together, our new corporate
plan. This was launched on GUS via blogs, articles and video
content. We also held a live event on Microsoft Teams for
colleagues where Aileen Evans spoke about it in greater detail,
explaining what it meant to colleagues and the business moving
forward. Colleagues were able to engage in a question and answer
session as part of this. A microsite was made available for all
staff to view, as was a printed copy and digital copy.
Last year's Annual Report and Financial Statements were also
made available for colleagues as either a digital pdf or printed
copy. A "year at a glance" summary page was published on GUS in an
easy to read, infographic format.
In October we launched a new online check-in, which replaced our
outdated appraisals. These check-in meetings are held once every
quarter and require colleagues to complete the form online, prior
to meeting with their manager. They also tied in with Further
together and our values, helping to create a direct link between
the goals of the organisation and those of individual colleagues.
Check-ins were promoted on GUS and colleagues reacted positively to
the new format.
Grand Union Housing Group
The year at a glance
Who we are
We've been in business for over 25 years and provide 12,000
homes for more than 27,000 people across Bedfordshire,
Buckinghamshire, Northamptonshire and Hertfordshire. We're a GBP75
million turnover social business with almost 400 staff.
Our mission is more homes, stronger communities, better lives.
We build affordable homes, provide personal support, and help
people to learn, work and be healthy.
We're a financially stable and innovative not-for-profit
organisation that believes in partnership and collaboration. We
plan to build 2,160 more new homes in the coming years to play our
part in ending the housing crisis.
Key progress against our commitments:
For today and tomorrow
Turnover GBP75m
Total assets worth GBP702m
We achieved VfM savings of GBP0.8m - GBP0.5m of these savings
come from the office move
In 2020/21 we built 111 new homes
We built:
-- 62 homes for rent (including social rent, affordable rent and supported living)
-- 25 shared ownership homes
-- 24 for market rent
G1/V1 - Confirmed Governance and Financial Viability Standard in
November 2020 by the Regulator of Social Housing.
A3 (Stable) - Confirmed Moody's credit rating in December
2020
We installed 4 electric charging points at K2 for colleagues to
use for free
For our customers
35,755 repairs were carried out and 574 voids were completed. We
spent GBP26.83m on home improvements and repairs which
included:
-- 477 homes with new windows and doors
-- 65 new kitchens and 22 kitchen upgrades
-- 104 new bathrooms and 32 bathroom upgrades
-- 395 new boilers installed, 22 new central heating systems and 56 upgraded
-- 419 high level works to properties
Year-end compliance levels:
-- Fire 100%
-- Legionella 99.15%
-- Asbestos 79.73%
-- Gas 99.79%
-- Electric 87.55% (within five years)
GBP3.26m benefits secured for customers in 2020/21
-- GBP1.01m of assistance with rent
such as Housing Benefit, Discretionary Housing payments or the
housing costs element of Universal Credit
-- GBP0.91m in disability payments which provide extra money for
customers with long-term health problems or disabilities
3,986 wellbeing calls made during lockdowns to over 70s and
Life24 (Supported) customers
We received 11,285 customer responses through Rant & Rave
(customer feedback tool)
Rent arrears were just 1.68% net (as of 31 March 2021)
1,781 customers have engaged with us via training, guidance and
advice sessions, consultation, IT training sessions and youth
sessions. We also have a further 70 customers on a waiting list for
any new consultations
79,355 phone calls answered by our Customer Contact team
7,016 web chats were answered by our Customer Contact team
33,729 emails were dealt with by our Customer Contact team
2,580 customers signed up to our new MyGUHG portal between 1 -
31 March 2021
For each other
We have 387 members of staff
57 have been here for more than 15 years
Turnover was 8.6%, the lowest for 8 years
For our partners
Working with NHS England and Adult Social Care we now have seven
properties housing nine customers living independently rather than
in hospital.
543 adaptations completed, 126 with support from the Local
Authority Disabled Facilities Grant enabling customer to enjoy
their home and provide comfort for their families knowing their
loved ones are safe at home
Wherever possible we try and keep customers safe in their homes
rather than moving, so move-on numbers are fairly low. We have
three domestic abuse refuges and a much needed fourth one will be
delivered in 2021/22. Since the Domestic Abuse & Safeguarding
team's formation in October 2020, we have taken the following steps
to ensure the safety of victims of domestic abuse:
-- Total moves: 6 completed moves, 3 still pending (1
application stage, 1 awaiting viewing, 1 moving to a refuge)
-- Additional security for home (lock changes, back door gates,
window locks, flood lights, Ring doorbells) - 20
-- Panic alarms - 28
Grand Union Housing Group
Strategic Report
The Board presents its Strategic and Board reports on the
affairs of Grand Union Housing Group Limited ("the Group") together
with the financial statements and auditor's report for the year
ended 31 March 2021.
The Group is comprised of
Our strategic commitments for now and the future
Going further together
On 1 July 2020 we launched our new corporate plan, Further
together, which sets out Grand Union's aspirations and goals for
the next three years and builds on the strong foundations we've
already put in place.
This ambitious plan was created with input from colleagues,
Board and importantly, our customers.
At its heart is the theme of trust - Further together is aimed
at deserving and retaining the trust of our customers, our
colleagues and our wider stakeholders.
To build this trust, we've based Further together on four clear
commitments:
For today and tomorrow
We take our responsibilities seriously and our goal is to be a
financially strong organisation, delivering on our social purpose
and our environmental responsibilities. We build great homes where
people can live great lives, and we use our influence for the
benefit of our communities.
For our customers
We serve our customers and their communities fairly and with
integrity. Our goal is for customers to trust us to provide advice
and support when they need it. We want them to know we're on their
side.
For each other
We support our people in their service. Our goal is that people
choose to come to Grand Union because they know they'll get the
support they need to fulfil their potential and we're in it
together.
For our partners
We're an honest and constructive partner. Our goal is for
different organisations to choose to work with us because they
trust us to share our expertise and help them to get things
right.
We know that we have the power to change things for good. That's
why we build more homes, stronger communities, better lives.
Because what we do matters.
You can read more details about each of the commitments in
Further together here .
Grand Union Housing Group delivery map
We are based in the heart of the Oxford to Cambridge Arc and
have made a long-term commitment to building new affordable homes,
where we can deliver efficient services and support our customers
now and in the future, as shown in the map below.
COVID-19 pandemic
The COVID-19 pandemic affected everyone involved with Grand
Union. It's touched on every aspect of what we do, and we can be
proud of how we've risen to the challenge, transforming our service
delivery to meet the challenges of the pandemic and ensure that we
were still there for our customers, colleagues and partners. We've
really seen how each of us has been driven to do more. And we've
definitely been in it together; working alongside members of our
communities to make a real difference.
Everyone has spent more time at home and this crisis has
demonstrated the importance of a home that is safe, secure,
affordable and meets their changing needs.
Our response to the pandemic has reinforced the benefit of our
transformation approach, by being adaptable to change we are
navigating through this crisis and will emerge stronger than ever.
This approach, led by Grand Union's leadership team and informed by
customer insight, has enabled us to organise our colleagues,
processes and technology to provide a more targeted and tailored
service to customers. The pandemic shifted both our customer base
and what was needed from us, by understanding this we have been
able to adapt to meet these changing needs.
As we come out of the current difficult period and plan for the
next three years, it's clear that we'll need our new skills and our
organisational and financial strength. Using scenarios from Savills
and Hargreaves, we have run pandemic stress tests on our business
plan including a drop in sales, delayed development and increased
costs and we have been able to demonstrate that our plan is robust
to withstand these additional pressures. Through our Financial
Inclusion team, we continue to support our customers through
assistance with disability and benefits claims.
We operate in an area of planned economic growth, and we have a
responsibility to help ensure that everyone in our communities
benefits from the opportunities that brings. That means playing our
part in tackling the housing crisis by building new homes at scale
and at pace, and making as many as possible available at genuinely
affordable rents. It means supporting our customers to achieve
their potential through education and training, employment and
getting involved in their communities. And it also means supporting
the people who work for Grand Union.
Our values
Further together is underpinned by the values that shape our
organisation's culture and guide everything that we do.
We're driven to do more. We empower staff to achieve more and
help us evolve into a more efficient, flexible and ambitious
organisation that has a positive impact on our customers and
communities.
We're in it together . Our can-do attitude and collaborative
approach help us achieve our goals and provide what our customers,
colleagues and partners need from us.
We deliver on our promises. We're committed to making a
difference to people's lives and by acting with integrity, being
open-minded and taking ownership, we can be trusted to do what we
say we will.
Our performance
In the past five years, we have transformed the way we deliver
our services and released financial strength to build more homes
for the customers of the future.
However, we knew we could do more, which is why we set our four
strategic commitments in Further together.
For today and tomorrow For our customers For each other For our partners
We take our responsibilities We serve our We support our We're an honest
seriously customers and people in their and constructive
their communities service partner
fairly and with
integrity
In what has been a tough year for so many, we're proud to have
already achieved so much against our strategic objectives and
commitments. We have incurred additional costs to protect our
customers and colleagues.
The last year has brought with it a number of significant
challenges, and we have identified different ways of working
throughout the COVID-19 crisis. We will learn from these
experiences and look at alternative practices for our customers and
business.
For today and tomorrow
Financial and operational performance analysis
We are financially strong, and any surplus made is reinvested in
what we do, delivering more homes and support services for our
customers.
Assets GBP'000
Housing properties 634,188
--------
Other fixed assets 2,136
--------
Investment properties 23,500
--------
Intangible assets 457
--------
Current assets 41,251
--------
Total 701,532
--------
Financed by GBP'000
Debt 315,591
--------
Pension liability 14,683
--------
Reserves brought forward 328,504
--------
Creditors (excluding
debt) 35,934
--------
Surplus for the year 6,820
--------
Total 701,532
--------
Group financial performance 2021 2020 2019
three-year summary GBP'000 GBP'000 GBP'000
Total turnover 74,943 71,166 74,299
--------- --------- ---------
Cost of sales 5,821 4,165 6,666
--------- --------- ---------
Operating costs 48,374 45,942 41,415
--------- --------- ---------
Surplus on disposal of property,
plant and equipment 1,764 3,455 2,649
--------- --------- ---------
Operating surplus/(deficit) 22,512 24,514 28,867
--------- --------- ---------
Comprehensive income for the
year 6,820 13,420 15,505
--------- --------- ---------
Fixed assets 660,281 633,025 604,966
--------- --------- ---------
Net current assets 18,622 21,980 26,725
--------- --------- ---------
Creditors - more than one year 328,896 312, 922 300,792
--------- --------- ---------
Revenue reserve 150,917 143,139 127,746
--------- --------- ---------
Financial Viability
The Board governs the affairs of the Group, which is regulated
by the Regulator of Social Housing (RSH). Following an in-depth
assessment in 2019, the Group retained its highest level ratings
from the RSH for both Financial Viability and Governance (G1/V1).
The Group continues to be rated A3 (Stable) by Moody's.
During the year, the Group issued and sold GBP21m of bonds to an
investor, generating proceeds of GBP30.3m. This funding was
achieved at an exceptionally low rate of 2.18% with a repayment
date in line with the original bond of 2043.
We also took the opportunity to issue a further GBP35m of
retained bonds which we have the option to sell in the future,
dependent upon future plans.
Governance
The recommendations from the governance review, which took place
in early 2020, were fully implemented by October 2020. These mainly
fell into two categories - structure and 'housekeeping'. The
structure changes resulted in a reduction in the number of
Committees, new Terms of Reference, and improved oversight for
Board. The new governance structure was launched on 1 October 2020
and we were particularly pleased to recruit two customer members to
join our new Customer Experience Committee. The two new members
were the first to receive our new Member Handbook and to experience
our revised members' induction process.
There were quite a few 'housekeeping' changes implemented which
standardised the report and minute templates, tightened up on the
management of papers and aligned Board and Committee meeting times.
The development of the Delegations Framework has given us a
comprehensive reference point, that brings together all of our key
governance documents into one place.
Grand Union remains compliant with the NHF 2015 Code of
Governance and the Governance and Financial Viability Standard from
the Regulatory Framework, with a G1/V1 rating confirmed in November
2020 by the Regulator of Social Housing.
Environmentally responsible (as a business and as landlord)
Over the last 12 months we have conducted a benchmarking
exercise to provide us with a baseline. Scope two and scope three
emissions for 2020/21 are atypical due to COVID-19 restrictions
which resulted in a decrease in energy usage, as people worked from
home and undertook less business mileage. Fleet transport emissions
have increased which reflects changes in our operations. Scope
three business mileage does not include the mileage for home to
office; this is deducted from our reporting as part of the expense
claims.
SECR reporting - 2020/21 2019/20 2018/19
energy and carbon
Scope one
------------- ------------- -------------
Energy use and emissions from use
of purchased gas
------------- ------------- -------------
kWh 940.00 53,677.00 94,670.00
------------- ------------- -------------
tCO2e 0.17 9.87 17.42
------------- ------------- -------------
Energy use and emissions from fleet
transport and machinery
------------- ------------- -------------
kWh 1,503,793.78 1,116,954.12 1,042,700.30
------------- ------------- -------------
tCO2e 366.53 273.08 258.09
------------- ------------- -------------
Scope two
------------- ------------- -------------
Energy use and emissions from purchase
of electricity for Grand Union offices
and sites
------------- ------------- -------------
kWh 289,934.00 358,122.40 435,383.00
------------- ------------- -------------
tCO2e 67.60 91.54 123.24
------------- ------------- -------------
Scope three
------------- ------------- -------------
Energy use and emissions from business
travel in rental cars or employee-owned
vehicles where Grand Union is responsible
for purchasing the fuel or awarding
mileage allowance
------------- ------------- -------------
kWh 249,828.16 631,815.34 700,376.92
------------- ------------- -------------
tCO2e 62.59 158.15 178.54
------------- ------------- -------------
Totals
------------- ------------- -------------
Total annual energy and emissions
------------- ------------- -------------
kWh 2,044,495.94 2,160,568.87 2,273,130.22
------------- ------------- -------------
tCO2e 496.89 532.64 577.29
------------- ------------- -------------
Intensity ratio: tCO2e per property
managed 0.04 0.05 0.05
------------- ------------- -------------
Our Environmental Sustainability Strategy includes targets for
reducing our environmental footprint which are reflected in both
our Asset Management Strategy and our New Business and Development
Strategy.
We have adopted the Sustainability Reporting Standard for Social
Housing; the aim of which is to provide a voluntary reporting
framework for housing providers to report on their sustainability
performance in a transparent, consistent and comparable way.
Participating housing associations will report against the standard
on an annual basis and we are working across the organisation to
plan and prepare for our first return in advance of the October
2021 deadline. The standard covers 48 criteria including
affordability, fire safety and carbon emissions monitoring.
Building more new homes
During the COVID-19 pandemic we have managed sites working in a
COVID-compliant manner and following government requirements. We
have continued to build and market new homes and grow our future
line, whilst following government guidance.
We completed 111 new homes and have been able to build a very
strong pipeline of future affordable new homes. We have an
identified pipeline of over 1,200 new homes, with over 90% of these
being affordable homes. We have seen strong interest in shared
ownership new homes generating over GBP4.8m of sales receipt and
continuing to reserve homes off plan across our operational area.
We successfully completed the sale of our first market sale scheme
in Oakley, Bedfordshire. These 10 homes were sold at prices above
our income assumptions and importantly, enabled us to deliver
additional affordable housing on the same site.
The Group continues to have access to Affordable Housing Grant,
through Homes England, as head of a consortium of three other local
housing associations which has enabled the significant development
programme to continue. This year we have secured flexible grant
payments on several schemes, which meant up to 90% of grant was
paid at site acquisition.
During 2021/22 we are on course to deliver more new homes with a
strong pipeline to follow in subsequent years. Our New Business and
Development Strategy places greater emphasis on land led
opportunities, relationships with local authorities, creating our
road map to net zero carbon homes and delivery by partnerships.
Success story: shared ownership
Jonathan and Nichola Houghton had been renting for many years,
trying their best to save to buy a house of their own. Through
Grand Union's shared ownership scheme, they were able to do just
that - ensuring the couple and their two children, Isla, eight, and
Harry, four, and beloved dog Bruno, have the space they need to
enjoy family life.
Jonathan, 39, said: "We moved into our brand-new home in
Cranfield in June 2020, and have never looked back. Nichola and I
were both born and bred in Cranfield so it's great that our kids
are growing up in the same area.
"The estate is lovely and our house picturesque. It looks like a
pretty, English countryside cottage - a two up, two down classic
property with beautiful features.
"Nichola and I had been renting since we moved in together in
our early twenties. We'd been saving for ages and looking at buying
a property, but it always seemed like a distant dream.
"What's more, at the age of 25, I was diagnosed with Lupus. It's
a condition which affects me everywhere, from my joints and
muscles, to my blood and organs. I've been in and out of hospital
with complications including ulcerated colitis and even suffered a
small stroke during my twenties. Because of this, I was unable to
continue work running a cleaning company and as a salesman, meaning
it was even harder for Nichola and I to save money."
It was in the beginning of February 2020 that the couple first
heard about the Cranfield shared ownership development. They'd been
renting a garage from Grand Union and when they saw the opportunity
advertised in a newsletter, they immediately put their names
down.
"We were blown away by the proposed building plans and knew a
local builder involved in the project - we had no idea a shared
ownership home could look so beautiful. To our surprise, our offer
was accepted, and we couldn't wait for the property to be
finished.
"Sadly, because of the COVID-19 pandemic, some of the building
work had to be put on hold. Nevertheless, Grand Union's New Homes
Officer Andrea Fisher was always on hand to help and we even had a
sneaky peak of the development during lockdown, through safety
glass and at a safe distance of course.
"The pandemic made moving house even more stressful than it
usually is - not least because I was shielding due to my long-term
health conditions. Andrea made it so much easier and even helped
advise us when our mortgage offer was pulled out last minute and we
had to liaise with a new bank. Everyone at Grand Union was really
helpful and understanding.
"Once we moved in, we were so happy. It's wonderful to live in
the village we'd called home for most of our lives, on a lovely
estate. The house is much bigger than our last place, and it makes
all the difference.
"Harry no longer sleeps in a cupboard-sized room that could
simply fit a single bed, a bookcase and very little else. His room
is three times bigger and Isla's room is larger too. Downstairs,
we've got so much more space and can't wait to replace our
furniture in the near future. Everything seems so much smaller now
we're in a bigger house!
"Nichola's also excited to do some interior decorating after
we've been here for some time. It already looks fantastic and
contemporary, but she always likes to put her own stamp on things
and let her creative juices flow. She runs a beauty salon, which
she's owned for more than a decade, so she's very artistic.
"Going forward, we plan to buy more shares so eventually we own
100% of the property - which is known as staircasing. Due to my ill
health, it's a relief to know we have somewhere secure to live;
when we were renting, we were never sure about what was coming
round the corner and feared we may have to move out at the drop of
a hat. Now, the security we feel is invaluable and we can begin to
plan ahead.
"The kids have thoroughly enjoyed the garden during lockdown and
the summer holidays; we installed a trampoline, built in the
ground, which brings them so much joy. Our beloved chocolate
Labrador Bruno also approves of the bigger garden!
"We're enormously grateful for Grand Union's support. Without
the shared ownership scheme, and guidance from staff members, it
would have been very hard for us to get on the property ladder. The
house has made such a difference to our lives and we're looking
forward to a happy future here."
Using our voice for good
This year we delivered our new Corporate Communication Strategy,
which sets out how we'll use our voice to support change for
good.
We've used our voice to promote the things we stand for,
including supporting the NHF's Homes at the Heart campaign
throughout the summer of 2020, and responding to two of the
Government's planning consultations such as Fire and Building
Safety, First Homes and Planning White Papers. We have also
responded to the All-Party Parliamentary Group ( APPG) for Housing
and Employment Enquiry and the APPG Housing Market and Delivery
consultation.
Since the launch of the Social Housing White Paper in November
2020, we have been working to understand the principles and how it
will impact Grand Union and our customers, and we have a project
group tasked with its implementation.
For our customers
Delivering on our promises
Our customers know that they can rely on us to deliver. We're
always clear about our promises.
In order to earn and retain our customers' trust, we have been
working hard to create a truly customer-centric culture where all
customers are treated fairly and with integrity. Our new customer
service standards and customer offer, launched in 2020, set out
what our customers can expect from us and provide clear standards
for our colleagues to work to. We monitor how well we are
delivering these standards through our customer feedback platform,
Rant & Rave. On the occasions when we fall short, our
Resolutions team acts quickly to recover service failure, avoiding
the need for customers to have to make a complaint.
The achievements of the Customer 2020 transformation programme
meant that we were able to quickly adapt, continue delivering
services and meet new customer demands during recent challenging
times. We set up a new Payment Support team in just four days to
meet growing customer demand to discuss rent payment problems. We
already have the tools and the technology to work remotely, so when
we went into lockdown we were able to switch overnight to operating
a remote customer contact team. This meant that we were able to
keep dealing with customer enquiries without any disruption to
service.
Hearing the customer voice through behavioural insight
Behavioural insight (BI) is an approach to policy making that
combines insights from psychology, cognitive science, and social
science.
Our BI project, which has been running since 2019, aims to help
us to:
-- target and tailor interventions with customers
-- make best use of our staffing resources
-- increase rental income whilst reducing the cost of collection
-- reduce tenancy failure, legal action and evictions
-- create better customer experiences
-- increase digital service adoption.
By making relatively subtle policy shifts, we can encourage our
customers to make decisions that are in their interest, as well as
the organisation's interest.
The project included interviews with different customer groups,
carried out by an independent behavioral insight consultancy. This
valuable insight and in-depth research undertaken during the
project has given us much better understanding of what factors
increase or decrease the risk of tenancy issues. We have learnt how
we can influence customer decisions, thereby reducing operating
costs and improving our relationship with our customers.
We are currently redesigning our income and repairs services to
incorporate the learning from this project. Colleagues from around
the business have attended a programme of training sessions on how
to use BI to have more productive conversations with customers and
tailor communications to get better outcomes.
New software, called Mobysoft, is helping us to focus customer
interventions on those most at risk of escalating rent arrears.
This will release capacity in the team and allow them to take on
debt recovery work previously carried out by other teams.
We expect to make significant efficiency savings of GBP3.4m over
the next five years as a result of this project.
Shaping the business around the customer experience
In the last year, we've undertaken an ambitious reorganisation
of our operational teams to align our structure to our
organisational goals, introducing some important new roles. Great
customer experience is shaped as much by the quality of the home
and neighbourhoods as it is by the services that we provide, so
we've created a single point of ownership for each area for our new
Property Managers. Our Customer Partners are deployed to support
customers and communities that need extra help. They own the
customer experience and coordinate activity from our internal
specialist teams.
We've created a new Service Improvement team, responsible for
the delivery of service innovation and continuous improvement
initiatives across customer facing teams. Their role is to identify
and deliver service improvement activity across the business using
Lean service improvement methodologies, customer feedback and
behavioural insight. The team has completed service reviews across
a number of key customer touchpoints including rent arrears
recovery and the repairs service. This work is enabling us to
deliver targeted and tailored customer interventions, improving
outcomes for customers.
Mindful of our goal to achieve an 80% channel shift, we have
continued to develop our customer communication channels and
digital services. Webchat has been expanded with the introduction
of chatbots to enable us to offer this service at any time of the
day or night. Our new customer portal was launched in March 2021
after involving customers in the testing phase.
Online viewings and sign ups have been a huge benefit to our
customers during a very testing year, enabling us to continue to
provide much needed homes safely throughout the pandemic. We also
launched our online repairs service in November, which enables
customers to report repairs and book their appointments 24/7.
Success Story: Involving customers in designing digital
services
In 2020, we began developing our digital offer (via the customer
portal) to enable customers to report and book repair appointments.
We engaged Tpas, England's leading tenant engagement experts, to
undertake customer testing and provide comprehensive user
experience, prior to rolling it out more widely.
We specifically wanted customer views on:
-- speed
-- appearance
-- ease of use/utilisation
-- minimising follow up calls.
We recruited 15 customers who agreed to participate in testing
the system, of which 10 subsequently took part. Despite the
drop-out rate, findings were consistent, suggesting that
opportunities and lessons from this exercise were largely
comprehensive.
Testers ranked themselves out of 10 in terms of how
'technologically savvy' they believed they were. This made sure we
tested a good range of experience and abilities.
Similarly, testers were split into segments, based on
behavioural insight. We also tested access via different devices to
determine whether the experience varied dependent upon how the user
accessed the system.
Each user was observed conducting a series of test scenarios,
designed based upon their individual circumstances.
As each user undertook their scenarios, they were asked to give
feedback on their experience, which was recorded on customer
journey maps. Similarly, as users progressed through the repair
reporting steps, their relative experience (positive, neutral, and
negative) was also logged, alongside the reason for this.
At the end of the testing, users were asked to score the speed,
appearance, ease of use and understanding of next steps. They were
then provided with an opportunity to state what they particularly
liked about the system, if there was anything they would like to
see improved and if they had any further comments.
All testers, irrespective of how digitally confident they were,
stated that they would use this system. All participants grew in
confidence after their first attempt - even if they struggled
initially - and by the time they were logging their third repair,
they quickly and easily navigated the system.
As a result of the customer testing, recommendations for
improvement were built into the design of the service before it was
launched in November 2020. A growing number of customers are now
using this service, with 20% of repairs now reported digitally, and
the figure is increasing.
Customer engagement and influence
During the last year we have working with Tpas to review our
customer engagement and influence arrangements. The key objective
was to design a framework that enables our customers to be involved
in helping us to reassess services and deliver cost-effective
solutions that bring real and lasting change to communities.
Building on the great work we had already done to build the
customer voice into our Lean service improvement programme, we set
out to create a platform for constructive conversations with our
customers that is transparent and based on respect and trust to
drive our business forward.
This project involved working with the Board and a large group
of customers, to co-create a structure that creates opportunities
for customers to formally hold us to account on service provision,
as well as being able to influence services by giving feedback on
experiences at an individual level. The project recommendations
will be presented to Board for approval during the summer.
Our existing homes
The condition of our homes is continually reviewed, with the
results determining a long-term repair and component replacement
programme.
Key highlights of 2020/21 spend and works:
Component Cost GBP'000 Total
Central heating GBP1,396 Boiler changes 395
--------------------- -------------------- ------
Full systems 22
------------------------------------------------------------------ ------
Upgrades 56
------------------------------------------------------------------ ------
Air source heat pumps Included in heating Full systems 8
--------------------- -------------------- ------
Roofing GBP1,357 High level works 314
--------------------- -------------------- ------
Upgrades 105
------------------------------------------------------------------ ------
Electrical testing Electrical jobs in
and upgrades GBP467 total 1,095
--------------------- -------------------- ------
Kitchens GBP448 Kitchens 65
--------------------- -------------------- ------
Upgrades 22
------------------------------------------------------------------ ------
Bathrooms GBP571 Bathrooms 104
--------------------- -------------------- ------
Upgrades 32
------------------------------------------------------------------ ------
Windows and doors GBP1,749 Windows and doors 477
--------------------- -------------------- ------
Upgrades 33
------------------------------------------------------------------ ------
Blocks 12
------------------------------------------------------------------ ------
Communal areas 37
------------------------------------------------------------------ ------
External works GBP1,186 Programmed works 208
--------------------- -------------------- ------
Upgrades 99
------------------------------------------------------------------ ------
Keeping homes safe
We consider that the successful management of all health and
safety activity is essential to the delivery of our business and
are committed to providing a safe environment within which our
customers can live without concern.
We deliver a comprehensive property compliance programme
comprising the following areas:
1. Fire safety
2. Legionella management
3. Asbestos management
4. Gas safety
5. Electrical safety
6. Lift management
In terms of governance, each month we track several key health
and safety performance indicators relating to our core compliance
activities, covering work undertaken both by our colleagues and
contractors. Through our existing control framework, we have
identified further improvements in our reporting of the key
compliance areas. Asbestos reporting previously stated the overall
percentage of properties with an asbestos survey and made no
distinction between our statutory and policy related obligations.
This has been changed and we now report to Board the compliance
against the non-domestic properties, where we have the statutory
duty, including the communal areas of blocks of flats.
The wellbeing of our colleagues and customers is overseen by the
Health & Safety Group, which meets four times per year, with
reports going from this group to the Audit & Risk Committee. We
also report to the Board, through the Audit & Risk Committee,
annually on all health and safety related activities; the
compliance areas are also subject to an independent annual
audit.
Challenging stigma, celebrating diversity
Everyone has a right to feel that they belong in their workplace
and their community. That's why we recently published our new
Belonging Strategy, which covers equality, diversity and inclusion
at Grand Union. We're really proud of the strategy because it has
been developed with input from Board, senior staff and our
colleague Belonging group who champion diversity here. The overall
aim of the strategy is to look at how we achieve a sense of
belonging for all our colleagues and Board members, and a sense of
fairness and inclusion for our customers.
We want to celebrate diversity and challenge stigma, speaking up
when we see others being treated badly. We want everyone to
understand and appreciate how diversity makes us stronger and that
we can learn and benefit from each other's different backgrounds
and experiences. Alongside the strategy is an action plan which
will enable us to deliver the Belonging Strategy and implementation
of this is already underway.
We have a Single Equality Statement which goes beyond the legal
requirements and is reviewed annually. We will also identify an
operational diversity lead to take forward a customer inclusion
action plan, with an initial focus on reviewing our data and
obtaining data that helps us better understand our customer mix and
inform the design of services. Our Board drives forward all of our
work on diversity and inclusion, monitoring progress through
regular reporting and with representation on the colleague
Belonging group.
We use our colleague intranet to celebrate diversity and educate
one another. Colleagues and Board members have written blogs and
articles giving insight into the different cultural celebrations of
their faiths including Ramadan, Passover, Holi and Vaisakhi. We've
also had articles and blogs covering other diverse subjects ranging
from Black History Month and Martin Luther King Day to LGBTQ+
History Month and World Down Syndrome Day.
Some colleagues have shared their incredibly personal and
powerful stories of how they've been affected by racism and
homophobia in their personal and professional lives to encourage
understanding, growing knowledge, acceptance and support across the
organisation.
Support where it's needed
Our customers turn to us when they need support, and we make
sure they get the advice or practical support they need. Our
Independent Living Strategy and our Community Investment Strategy
clarify our approach.
Grand Union provides a range of services to support its
customers through the ongoing complexities of welfare reform
changes which have impacted them. These include direct support and
advice, which has contributed to the continued low level of
customer rent arrears within the Group.
2020/21 2019/20
Welfare Benefits - opened
cases 1,230 1,140
-------- --------
Money Advice - opened cases 193 209
-------- --------
GBP'000 GBP'000
-------- --------
Benefits gains for customers 3,264 3,424
-------- --------
Success stories: Welfare Benefits
1) Tina Sullivan joined Grand Union's Financial Wellbeing team
just over two years ago and when Miss C was referred to the
Financial Wellbeing team she was one of Tina's first referrals.
Maybe this is not something to boast about, but we think it
demonstrates that with some cases you have to be in it for the long
haul. It also shows that some cases take longer than others to
resolve in full.
Miss C lives in supported living and receives enhanced personal
Independence Payment (PIP). Inexplicably, she was also placed in
the work-related activity group as part of her Employment and
Support Allowance award, which suggests that the Department for
Work and Pensions (DWP) could expect her able to do some form of
work-related activity. An open and shut case for reassessment into
the support group.
What Tina hadn't expected was the long period of waiting for a
home visit assessment by the provider for the DWP. Eighteen months,
two formal complaints and two lockdowns later, the DWP reviewed her
case and placed her into the support group.
Although this may not have been a huge financial win - she
gained an extra GBP9.65 per week - her award now fairly reflects
her needs and all we need to do now is find out when the DWP will
finally pay her the arrears.
2) In June 2020, during lockdown, the Welfare Benefits team
received a referral from Tenancy Support to contact Mrs G who was
originally homeless. She had just been allocated one of our
properties and needed help setting up all relevant benefits - the
Tenancy Support team was helping her out with white goods for her
property and making sure that she had everything needed to start
her new life in her new home.
The Welfare Benefits team called the customer within 48 hours of
receiving the claim explained about Housing Benefit and Council Tax
reduction, but luckily she already knew about this and had
submitted her claim.
The team identified that her only source of income was a state
pension which was below the normal state pension amount. Straight
away they identified that they could claim Pension Credit for her
to ensure that her income would be topped up to that recognised by
the Government as the minimum pension amount, which is GBP175.20
per week.
They called the customer again in July and submitted her claim
for Pension Credit, which was awarded at GBP21.00 per week - not a
massive amount but she was grateful, saying it would make such a
difference to her.
The more the team spoke to Mrs G, the more they realised that
she had additional challenges in her life due to some medical
issues. They submitted a claim for Attendance Allowance which was
awarded at a rate of GBP59.70 per week. As a result of this, Mrs
G's Pension Credit also increased as she was eligible for a Severe
Disability Premium of GBP65.85 per week, which was on top of the
GBP21.00 already awarded. All in all, she was significantly better
off per week thanks to the team's help and support.
Inclusive, supporting wellbeing
We understand our customers and their different needs, and we
use technology intelligently. Our Wellbeing Strategy makes it clear
that, when there are obstacles to overcome, we make sure we're
always part of the solution and never part of the problem. We
provide bespoke housing and support solutions for a diverse range
of customers. We work collaboratively with local authorities,
National Health Service England, clinical commissioning groups,
charities and family carers. Our aim is to provide a seamless
service for all of our customers.
Success stories: Supported living
Harry, 21, moved into one of our supported living schemes in
Downhead Park, Milton Keynes, in September last year, having
previously lived with his parents. He's one of 11 young men who
live in this particular scheme that Grand Union has been managing
since July 2019.
Harry loves having his own place, he said: "My home is very
important to me because it's actually made me closer to my parents.
When I lived with them we argued sometimes, but since living on my
own we get on so much better. I enjoy having days out with them and
also having time by myself.
"I think my flat is really nice and it makes me feel safe and
secure. I call it my homepad.
"I can phone for repairs by myself and talk to people if I have
a problem. It's made me more independent."
Marcus Olozulu is the Independent Living Officer for the scheme.
He said: "When Harry first moved to his new home, he would have bad
panic attacks; once he was rushed to hospital as it was so bad.
Anxiety can be a big issue with people with autism.
"He soon learnt to cope and knowing he had me on the end of the
phone in the week, if he needed me, also helped. Meeting with him
when he was anxious has improved things, plus at night-time,
there's a concierge present.
"Harry was quite timid to begin with, but he's definitely come a
long way since living there. I'm really proud of him.
"He keeps his flat very clean and tidy and does his own laundry
and washing up as well."
Marcus visits the scheme two or three times a week to support
residents with their benefits, especially Housing Benefit, and to
follow up on any repair issues. Along with a fellow colleague,
he'll get stuck in to assembling their furniture too!
"I give advice on various things like ways to save money,
maintaining good mental health, health and safety in their home,
healthy eating and any tenancy rules. Recently, I had to get pest
control out to treat a wasp nest as Harry is allergic to wasp
stings.
"I also support the residents emotionally and will mediate
between them sometimes when issues crop up. Often I'll signpost
them to other agencies so that they can fill their time but with
lockdown this has been difficult."
Harry is proud to work for a hospital radio in Milton Keynes
once a week, a role he loves. He joined a community centre, but
this has been on hold due to the COVID-19 situation.
"Harry's a big fan of 80s music and particularly loves Bob
Marley, as you can see from his t-shirt. He has his own DJ music
deck which he thoroughly enjoys."
Harry added: "I've made new friends since living here, I can
watch what I want on TV and I can play my music a bit louder than
when I lived at my parents!"
A Sector first - Launching our safe space
In March 2021 we launched our online Safe Space, to help tackle
domestic abuse. We are the first housing association in the UK to
provide this, so we should be rightly proud of ourselves.
Through an untraceable link on our website, by clicking the Safe
Spaces logo, Grand Union customers and the wider public will be
able to access information on helplines and specialist support
services. Online Safe Spaces aim to increase the opportunities for
victims of domestic abuse to safely access support while carrying
out daily online tasks.
We have been working in partnership with the charity Hestia,
which supports individuals in crisis, on this project. The Safe
Space launch coincided with the charity's #NoMore campaign -
something we are actively promoting, alongside the charity's Bright
Sky app which supports domestic abuse survivors.
Sadly, the scale of domestic violence across the UK has only
increased due to the COVID-19 pandemic. According to the Office for
National Statistics, domestic abuse rose by 10% in 2020 compared to
the previous year. Now more than ever, every housing provider has a
duty to do all it can to prevent people suffering from violence and
emotional abuse in their homes.
Grand Union is committed to tackling domestic abuse and we run
three local domestic abuse refuges, with a fourth due for
completion next year. These refuges provide survivors with the
skills to return to the community, empowering individuals and
making them feel safe at home. Our unique personalised alarm
support service, Life24, can also be used for those fleeing from
domestic violence.
Everyone deserves a safe and secure place to call home and, with
the launch of our online Safe Space, we are doing our bit to tackle
domestic abuse.
For each other
Trust and respect
GUS, our intranet, allows colleagues to give shout-outs to each
other and #teamwork and #together are the most used for these,
highlighting how important everyone sees working together is to our
success. There have also been numerous examples of secondments from
one team to another, supporting each other when resources have been
negatively impacted.
During the year we signed up to Harry's Pledge, a commitment to
support carers in the workplace. We identified carers through a
questionnaire and asked if they were getting the support they
needed, acting on it if that was not the case. We have also created
a carers page on our intranet with useful links to carer related
support organisations.
We recognised that a number of colleagues' families will have
been impacted by the pandemic, some having their income reduced and
others affected by job losses. So, during the year we introduced
the Centre for Financial Education (Cfed) to help support
colleagues with their finances. This has been well received with
some saying that the education they received has been
life-changing. Once lockdown has been fully eased, Cfed will attend
our office to bring their knowledge and education to more of our
colleagues who could benefit from it.
Attendance during lockdown has improved greatly with average
days lost to sickness absence reducing from over 10 days to under
seven days per person. This has been helped by the majority of
colleagues being able to work from home during the pandemic. With
the changes to our agile framework, colleagues will continue to
work from home for the majority of the time, which we hope will
help to sustain the reduced levels of sickness absence.
Celebrating our diverse workforce
We will work to ensure Grand Union is an employer of choice,
attracts diverse colleagues who embrace our values and want to
grow, achieve their full potential and stay within the Group. We
want everyone to feel like they belong and our new Belonging
Strategy, which has been created with the Board and a colleague
diversity group, is helping us to make changes, including positive
action where appropriate, to ensure that we, as an organisation,
are representative of the customers and communities that we
serve.
We have carried out some work to close the data gaps so that
reporting can be more accurate and this year we have used the NHF
data tool to compare our diversity data with the communities that
we serve. This data was sourced from the ONS Annual Population
Survey. The next census is due in 2021, with the results coming out
in 2022. The tool will be updated with this data once it is
available.
Whilst we are proud that we have a 50:50 gender split at the
senior levels, that we have a high representation of those from the
LGBTQ+ community, and that PGM representation is also currently
higher than our communities when compared with the NHF data, there
is still more work to do. We need to improve the data for those
with disabilities, increase the number of younger people we are
recruiting and do further work on ethnic diversity. We are working
closely with the Housing Diversity Network, Board and colleagues to
define clear actions against which we can be accountable. We will
continue to work hard to ensure equality and diversity
representation across all levels of the organisation including the
Board.
Grand Union fully complies with its obligations on gender pay
gap reporting. You can find our report on our website at:
www.guhg.co.uk/gender-pay-gap-report/. We produced an ethnicity pay
gap report last year, which shows no ethnicity pay gap. We will
continue to report on this annually.
A brief overview of our equality and diversity monitoring
2021
Gender
-- 55.38% of colleagues are female
-- 44.62% are male.
Grand Union's female to male ratio is over 4% higher than the
population in the areas in which we operate.
This is a 5% shift on the number of male colleagues reported
last year. This is mainly attributable to the in-house transfer of
colleagues from Jeakins Weir in October 2020.
40% of Board members are female - an improvement on last year
when only a third were female.
Ethnic origin
-- 80.77% of colleagues identify as white
-- 10.51% identify as People of the Global Majority
-- 0.77% prefer not to say, leaving a 7.95% gap in data.
This compares to the population data which reports 7.3% of those
in our operational area are from PGM groups. This suggests that the
workforce, Leadership team and Board are fairly representative,
based on this data.
The representation of PGM groups has reduced compared to last
year when it was 11.4%. While work has been done to improve the
diversity of those we recruit, this reduction may also be partly
attributable to the transfer of Jeakins Weir colleagues who were
not ethnically diverse.
Age
Our workforce has only half the representation of 16-24 year
olds when compared to the population. The Leadership team and Board
have no representation in this age group. However, whilst the Board
has improved the age profile when compared to last year, the
Leadership team does not have representation in the 25-34 age group
either.
The workforce is also under-represented in the 65+ group, but
that is to be expected as the large majority of colleagues will
have retired by 65. The Board is over-represented from 45 years and
over when compared to the population.
We still have some work to do to improve the representation of
younger colleagues in the workforce, Board and Leadership.
Sexual orientation
-- 2.56% categorised themselves as gay or lesbian. This compares to 0.39% of the population.
-- 1.28% categorised themselves as bisexual. This compares to 0.17% of the population.
No members of the Board or Leadership team have categorised
themselves as gay, lesbian or bisexual.
3.63% of the population categorised themselves as 'other'
meaning that they did not consider themselves to fit into any of
the categories.
Religion
-- 38.21% of colleagues identify as Christian, which is similar
to the percentages for the Leadership team and Board.
-- In total, 6.41% of colleagues are Buddhist, Hindu, Muslim or
follow another religion. This compares to 3.9% of the
population.
-- 39.23% of colleagues have no religious beliefs.
The Leadership team and Board are less diverse in the area of
religion.
The data gap has also improved on the reporting of religion,
with only 12.05% now missing.
Disability
-- 3.08% of the workforce categorise themselves as disabled compared to:
o 0% of the Leadership team
o 5.88% of Board (one member)
-- This compares to 19.42% of the population.
This is an area that shows under-representation and the first
step will be to consider how we improve the data, as we believe
there are more colleagues with disabilities than those
reported.
Positive and empowering
We believe colleagues are proud to work for Grand Union and we
want our customers to feel this passion. Following the pandemic,
our agile working framework has been reviewed to reflect the
progress that has been made over the last year with colleagues
working more flexibly and mainly from home.
Supporting growth and wellbeing
In her position as President of the Chartered Institute of
Housing, our CEO, Aileen Evans worked with MIND to create a mental
health toolkit for housing associations, which was published in
2020. She was then honoured by InsideOut, a social enterprise
looking to end the stigma of mental ill-health in the workplace, by
featuring on their Leader board 2020 for championing mental
ill-health issues in the workplace .
Our Mental Health First Aiders (MHFAs), who include a Board
member, have been busy during the pandemic, which has had an impact
on many colleagues' mental health. Introducing MHFAs has been a
real positive for Grand Union colleagues.
Last year we introduced a new, online, check-in process which
encompassed a wellbeing action plan, ensuring that at regular one
to one meetings, managers are talking to their teams about their
mental wellbeing. This, together with having career discussions as
part of the process, has made the discussions much more personal.
Having them online during the pandemic has really helped to improve
compliance.
With the launch of the K2 Academy in January 2021, all
colleagues' learning needs, including management and leadership
development have been brought together in one place. We look
forward to seeing the K2 Academy continue to build and thrive as
more programmes, such as our Aspire and mentoring courses, are
launched.
We have had our annual review with Investors in People (IIP) and
continue with our accredited status. We will be putting a plan
together to work towards and achieve IIP Silver during 2021/22.
For our partners
Understanding what matters
Being clear about our operating area and our purpose means that
we can spend quality time understanding our partners' priorities
and values, so we know how, together, we can deliver more, by being
stronger than the sum of our parts.
Positive engagement
We're proactive as well as responsive in our stakeholder
management. We bring our focus on solutions to every
partnership.
We know that many of the projects are long term, such as the
Greater London Council style estate within the town of Sandy in
Central Bedfordshire. We have been part of a project to transform
the infrastructure of this estate. The project board consists of
Grand Union, Central Bedfordshire Council (CBC) Officers and
Councillors, Town Councillors and, working with local residents,
the aim is to improve the aesthetics of the area and provide
additional parking.
This project also involved consultation with residents to
demolish 39 garages nearing the end of their useful life and
offering customers alternative nearby garages as needed. Planning
permission has been sought to remove planters, create more parking,
introduce new arboriculture, and generally create a more cohesive
community.
Success Story: community engagement
At Bilberry Road, Clifton, we are starting to see a community
thrive thanks to the multi-agency work to deal with antisocial
behaviour (ASB), including drug related issues. Working with the
key stakeholders' project group, the local community and young
people, a plan was put in place to tackle issues from all angles
following an ASB crime reduction report. A local lettings policy
was introduced, and a community facility called "The Hub" was
established on the estate for all partner agencies and the
community to come together. Estate improvement works have been
carried out and working with the police and CBC enforcement
measures resulted in for closure orders. Feedback has been received
from the community, parish council and partner agencies about the
positive impact of this on the estate.
Transparent and accountable
We share information to ensure transparency of our performance
because we understand that being held to account makes us
better.
We fully comply with the Housing Service Ombudsman Code and our
self-assessment has been published on our website.
Our Customer Resolutions team meets regularly with service
managers to review complaint trends and make sure recurring issues
are identified and acted on. This has resulted in a number of
changes, the details of which are also published on our
website.
Our biggest customer touchpoint is repairs and the service area
that attracts the most complaints. In the last year we have created
a Service Improvement team, made up of accredited Lean
practitioners, and we have an ambitious programme of Lean service
reviews, including our repairs service.
The repairs service review will analyse and address failure
demand and ensure our processes enhance the customer experience.
Customer feedback and complaint trends have been fed into the
review. A key focus will be on improving our right first-time rates
as this is the main cause of complaints and negative customer
feedback. The project will run until the autumn of 2021 and will
involve working with customers at key stages.
Our customer care training programme 'Doing the basics
brilliantly' was designed using learning from customer feedback and
complaints. This has been delivered to all customer facing
colleagues in the Group. All new starters will attend this training
within their first three months. Bitesize training modules are now
being developed and topics will be informed by customer feedback
and complaints. We are also rolling out practical problem-solving
training across the business to ensure that colleagues understand
the root cause of recurring problems and identify the right
solutions.
Valuing our reputation
The aim of the Communications and Public Affairs Strategy is to
help Grand Union to go further together, by using our voice for
good, and enhancing and protecting our reputation.
In 2018 we ran a perception survey to make sure that our
stakeholders understood us and that we understood them.
Since then, we've used the findings to build on those
relationships and partnerships and have now started work on a
follow up perception survey so we can make sure we're still on the
right track.
We're also working to provide customers and stakeholders with
proactive, transparent communications. Using a mix of customer and
colleague engagement, we're progressing with an organisation-wide
project to ensure all letters we produce are easy to understand and
written in plain English. This has also included the introduction
of a "how's our writing?" icon on all letters and emails, inviting
customers to feed back and tell us what's working and what
isn't.
Value for Money (VfM)
VfM is a key element of our Further together strategy. By being
more efficient we can build great homes where people can live great
lives and where we also provide an excellent service to our
customers.
Being more efficient is delivering both economic and social
value - high quality homes and services, and cash we can invest in
building and doing more.
Highlights in 2020/21
During the year, our focus has been firmly on transformation,
operational integration and investing in our people. The key
savings are highlighted below.
Business Transformation
Our business transformation programme is based on detailed
customer insight and by using innovative data science techniques we
are making sure that our services are designed around the needs of
our customers. The new ways of working, delivered as a key element
of our office rationalisation, has been key to us successfully
dealing with the COVID-19 pandemic. The original annual savings
forecast of GBP0.3m will be higher as a result of the significant
shift we have seen in digital services, flexible working and
reduced travel. This change has enabled us to go further, faster,
and the closure of our three touchdown points will save us a
further GBP65k annually, bringing total savings to GBP0.5m.
By investing in great technology to support transformation, we
are making it simple for customers and colleagues to get things
done and are building trust in us to deliver a great customer
experience. There will be financial benefits, with net cost savings
of GBP2.3m by year five, meaning we can do more to support current
and future customers.
We have implemented our new operating model that delivers a more
targeted and tailored service to customers and by aligning our
operational structure we have saved around GBP0.25m annually in
staffing costs that have enabled us to deliver some vital new work
on environmental sustainability, domestic abuse and safeguarding,
and building safety with no increase in operational
expenditure.
New Business & Development Strategy
The strategy was reviewed as part of our new and ambitious
corporate plan, Further together, and continues our drive to
deliver much needed, genuinely affordable homes, to help solve the
current housing emergency. By 2026 we aim to have delivered 2,160
homes for social benefit, a quarter of which will be at Social
Rent. To support this programme, we will deliver 216 homes for
market rent or sale. Our NHS and Social Care partnerships
demonstrate the wider social value that great housing provides for
the most vulnerable customers; together we have helped deliver NHS
efficiencies and better outcomes through the 'Transforming Care'
programme. Currently we do not have enough data to evaluate this,
but are in the process of conducting surveys for our wellbeing and
support service and will be able to report on this next year.
Asset Management
The environmental emergency and Government's commitment to
achieve net carbon zero by 2050 presents a challenge and
opportunity for us. Our new Strategic Asset Management Strategy,
supported by our innovative portfolio management plan, seeks to
deliver net carbon zero by 2050 alongside delivering any future
homes standard. We have rolled out a new strategic asset management
system that will drive both our investment programme and support
portfolio management decisions, identifying homes where realising
the social capital of the asset presents opportunities to invest in
new, sustainable, cost-effective homes. The strategy extends beyond
our homes and is delivering new homes on garage sites and land
owned by us and our partners, to not only regenerate communities
and deliver more homes but also increase the overall value of the
asset base.
Procurement
We have continued to amalgamate contracts where possible and are
members of several procurement partnerships, ensuring competitive
tenders are received in the most efficient way. Furthermore, Grand
Union acts as contracting authorities on a number of frameworks
including materials supply and utilities which achieves additional
value. In the year, we have set up a centralised procurement team
which will co-ordinate procurement across the business. During the
next year they will produce a wave plan so that we can be more
proactive in contract negotiation.
Transformation Projects
We have a Programme Overview Board which governs all
transformation projects ensuring that projects are only approved
once the business case prepared demonstrates value for money,
whether economic or social.
Delivering digital solutions have been key projects this year
and our new digital onboarding saves approximately GBP20k a year in
office time and travel costs, as the sign up can now be completed
by the customer through our new portal, freeing up the team focus
on those customers that need more help from us. Our new online
repairs booking system has been implemented, which saves officer
time in the reporting and booking process. Since it was implemented
in November 2020 this has saved us around GBP12k. We are aiming for
a 40% shift to digital repairs reporting this year, which will
produce savings of around GBP112k. One of the other projects
implemented this year was a complete review of our voids process.
Using the Lean principles, we have implemented a new process which
ensures that the time taken to have homes ready for new customers
to move in will reduce. We are already seeing times fall by up to
one third and, as we roll this out in 2021/22, expect to see
savings exceed GBP76k annually.
Insourced recruitment service
Our Recruitment & Talent Manager continues to make a
positive impact on modernising our application process and ensuring
more first-time placements. We have managed to recruit 74
colleagues. The total number of applications has risen by 113% and
a key factor is our active work on our employer brand. We have
bought and own our Indeed page and there has been a high increase
in presence and footfall on our career site. Our presence on
LinkedIn increased to 1,500 followers in just one year and we now
have 2,561 followers. This has led to a reduction in our
recruitment costs which are estimated at over GBP30k.
We are working on our Employer Value Proposition and have
carried out most of this work internally instead of using an
external consultancy, saving GBP18k.
Learning and Development
During the last 12 months, the Learning and Development team has
embraced the world of virtual delivery, supporting colleagues to
learn and develop. Despite some disruption through the pandemic,
colleagues attended 805 recorded learning interventions. The team
opened the K2 Academy, our in-house centre of excellence, in
January 2021, delivered 14 days of virtual training, covering
subjects from new manager training through to mentoring and mental
toughness, with a saving of GBP12k.
Many colleagues have engaged with the hundreds of free webinars
that have been available, and further savings have been made on
travel and hotel accommodation for external conferences and
courses. In addition, IOSH working safely has been brought in-house
and delivered virtually, with a cost saving of GBP6k over three
days of delivery. The pandemic has seen a reduction in attendance
at conferences and has resulted in a saving of GBP87k, minimising
business expenditure for the year. Future training will be a blend
of virtual and physical attendance and savings are expected to
continue.
Our plans for 2021/22 are the continued delivery of new manager
training and IOSH working safely. We will introduce the Institute
of Customer Service first impressions training, an aspiring
managers programme, and a leadership development programme, with a
combined predicted saving of GBP69k. There will be more new money
saving initiatives form the Learning and Development team during
the year.
Electric car scheme
We have recently introduced a salary sacrifice car scheme for
colleagues focused on electric and hybrid vehicles. The scheme will
not only support our green agenda, but it will also provide NI
savings of approximately GBP600 per year per car leased. Business
mileage for electric cars from the scheme is paid at 4p per mile -
providing a further saving from the 45p currently paid. Four cars
have been ordered so far, one of which has already been
delivered.
Mileage savings
During lockdown, we have minimised the need for colleagues to
attend the office and visit customers, unless the situation is
urgent or an emergency. This has greatly improved our carbon
footprint by reducing the amount of business and commuter mileage.
The savings in mileage costs were GBP136k against budget.
VfM metrics
The metrics below reflect the challenges of the environment we
are operating in, given the impact of the pandemic and our
continued investment transforming our customer services and
investment in maintaining our homes.
Metric 2020/21 2019/20 *Peer Sector 2021/22
group scorecard Targets
average 2019/20
2019/20
Reinvestment 5.68% 5.90% 8.74% 6.10% 13.09%
--------- --------- --------- ----------- ---------
New supply delivered
- social housing 0.73% 1.43% 2.20% 1.26% 3.33%
--------- --------- --------- ----------- ---------
New supply delivered
- non-social housing 0.20% 0.14% 0.21% 0.00% 0.13%
--------- --------- --------- ----------- ---------
Gearing 46.43% 45.83% 51.87% 33.80% 47.00%
--------- --------- --------- ----------- ---------
EBITDA MRI 166.83% 162.30% 176.36% 196.10% 202.00%
--------- --------- --------- ----------- ---------
Headline social housing GBP3,438 GBP3,448 GBP3,695 GBP4,023 GBP3,593
cost per unit GBP
--------- --------- --------- ----------- ---------
Operating margin - social
housing lettings only 28.03% 28.91% 31.56% 23.60% 32.00%
--------- --------- --------- ----------- ---------
Operating margin - overall 27.68% 29.59% 28.99% 21.50% 29.34%
--------- --------- --------- ----------- ---------
Return on capital employed
(ROCE) 3.32% 3.74% 4.15% 2.80% 3.70%
--------- --------- --------- ----------- ---------
*Our peer group consists of, bpha, Futures Housing Group,
Settle, Stonewater, PA Housing, Longhurst Group, East Midlands
Group, Greatwell Homes, Paradigm Housing and Nottingham Community
Housing Association
Reinvestment remains strong at just under 6% and includes both
new supply and investment in existing stock.
The provision of new supply of social stock reduced this year
due to lower than anticipated development activity due to the
pandemic. However, this will grow to in excess of 3% as the
development programme grows to 2,160 units over the next five
years. We continue to look at growth opportunities including
strategic partnerships. There will also be future growth in the
delivery of non-social housing as new tenure streams are developed,
including market sale homes to complement the market rent portfolio
already managed by the Group.
Our gearing ratio has increased over the past 12 months as cash
resources have been utilised through increased costs in the general
operating environment impacted by the pandemic, a development
market that is increasingly competitive and increasing costs
relating to more land led schemes and significant investment in
transformation projects to deliver better customer service.
EBITDA MRI has increased year on year partly as a result of
additional transformation costs, lower sales and higher maintenance
costs. The EBITDA MRI is broadly in line with our plan and reflects
the Group's appetite to remain financially strong.
We have financial golden rules which help safeguard the Group
against external risk. These have been assessed as part of the
Resilience plan included in the Risk Management Framework and for
specific treasury considerations as part of the annual Treasury
Management Policy review which requires appropriate levels of
comfort to be maintained across a variety of measures including
gearing and interest cover.
The Headline Social Housing Cost per unit has marginally
decreased due to a reduction in planned repairs works as a result
of the pandemic. The Group continues to invest in its
transformation and during the year we have insourced our repairs
team, which will reduce our overall cost per unit in the coming
year.
The operating margin has been negatively affected for both
social housing lettings and overall, as a result of the increased
operating cost mainly from investment in transformation projects
and increased costs relating to the pandemic.
During the year we issued and sold GBP21m of bonds to an
investor, generating proceeds of GBP30.3m. This funding was
achieved at an exceptionally low rate of 2.18% with a repayment
date in line with the original bond of 2043.
We also took the opportunity to issue a further GBP35m of
retained bonds (a future option to issue another loan) which we
have the option to sell in the future, dependent upon future
plans.
Sector scorecard
Metric 2020/21 2019/20 Sector scorecard 2019/20
Customer satisfaction 4.4* 4.3* N/A
-------- -------- -------------------------
Customer satisfaction 11.5** N/A N/A
-------- -------- -------------------------
Investment in communities GBP0.9m GBP1.0m N/A
-------- -------- -------------------------
Occupancy 99.49% 99.42% 99.28%
-------- -------- -------------------------
Ratio of responsive to planned maintenance spend 0.79 0.71 0.64
-------- -------- -------------------------
Rent collected 99.87% 99.80% 99.84%
-------- -------- -------------------------
Overheads as a % of adjusted turnover 12.42% 12.32% 13.90%
-------- -------- -------------------------
*Grand Union now monitors customer satisfaction through Rant
& Rave
** Grand Union monitored customer satisfaction through the
Institute of Customer Services
Customer satisfaction has fluctuated throughout this challenging
year, peaking at 4.6 during the first lockdown, ending the year at
the lowest point for 12 months. Net Promoter Score, however, has
increased over the same period.
Service managers have responsibility for reviewing feedback from
Rant & Rave to identify opportunities for service improvement
and make sure service improvements are prioritised and acted
on.
Our biggest customer touchpoint is the repairs service and,
unsurprisingly, this is the service area that attracted the most
negative feedback during the year. We are undertaking a
comprehensive review of the repairs service to tackle recurring
service issues, strip out unnecessary waste and ensure our
processes are aligned to and enhance the customer experience.
Learning from complaints and Rant & Rave is a key part of the
review. A prime focus will be on improving our right first-time
rates as this is the cause of many complaints and adverse customer
feedback. The project will run until quarter 3 in 2021 and will
involve working with customers at key stages of the project.
Our plans for further improvement
As for many in the sector the pandemic has resulted in this
being a challenging year which has been felt across the
organisation and reflected in our published metrics. Next year's
targets represent a bumper year for development and the
commencement of efficiency savings from investment in business
transformation. We have some key projects planned for next year
which support our value for money strategy.
The target operating model restructure and IRT insourcing, which
were implemented during the year, will be embedded and the savings
realised.
Over the next five years we are investing just over GBP3.5m with
a total forecast saving of GBP9.5m. The biggest area of investment
comes from systems transformation, and it is anticipated a large
proportion of this will come from the development of a new CRM
system using Microsoft Dynamics and Power Apps. The new CRM system,
along with the enhancement of supporting systems plus Lean process
reviews, will enable us to deliver service delivery savings using
behavioural insights.
During 2021/22 we will be introducing pension salary sacrifice
which will result in significant NI savings of around GBP50k per
annum. Colleagues in the scheme will also save - on average GBP210
per year.
Our new Sustainability Strategy and Strategic Asset Management
Strategy were approved in the year and this will support our work
in maximising our social value.
The current pandemic situation we are facing has challenged us
to do things differently and we will be working on a new VfM
strategy and targets next year, incorporating all of the lessons
learnt during this time.
Group Board
The members of the Board are shown on page 1. Board members are
drawn from a wide background, bringing together professional,
commercial and local experience. At 31 March 2021 the Group had
issued 10 GBP1 shares.
The Grand Union Housing Group Board met formally eight times
during the year and undertook one strategy workshop and a Board
risk appetite and stress testing workshop. The increase in the
number of the meetings was due in part to the new governance
structure, which now allows for six meetings per year. In addition,
the Group Board was supported during the year by the following
group wide committees.
Subsidiary Boards
Grand Union Homes Ltd
This subsidiary was established in 2015 to build quality homes
and create sustainable places catered to local markets across
Bedfordshire, Northamptonshire and Buckinghamshire. It prides
itself on creating vibrant communities in great locations, which
offer a range of housing choices for every stage of life. By
reinvesting all profits into affordable housing, Grand Union Homes
is able to help realise Grand Union's mission of building more
homes, stronger communities and better lives.
Grand Union Group Funding PLC
This subsidiary was formed in late 2013 and the principal
activity of the Company is to act as the funding vehicle for Grand
Union Housing Group. As the Company's activities are limited to the
raising and management of private finance for Grand Union Housing
Group Limited (GUHG), it employs no staff and all administration
functions are carried out by the finance team of GUHG.
Audit & Risk Committee
The Group's Board has delegated the monitoring of the risk
management framework and internal controls to the Audit & Risk
Committee. They met five times during the year and reports to the
Board on its activity throughout the year. The Committee is
responsible for recommending the appointment of both internal and
external auditors and considers the scope of their work each year.
It also receives regular reports from both sets of auditors. The
Committee reviews in detail the annual report and financial
statements and recommends them to the Board.
Development Committee
The Group's Development Committee met twice in the first half of
the year, to review the development and asset management strategies
and new business opportunities and assumptions. It played an
important role in monitoring risk, programme delivery and sales on
behalf of the Board, and ensured detailed scrutiny and oversight of
the appraisal methodology. However, the governance review
identified that the increasing development programme needed closer
scrutiny by Board and therefore the Committee was retired on 30
September 2020. A new group, Investment and Development Group, was
developed outside of the governance structure. The role of this
group includes appraising the schemes and monitoring the whole
programme and key expenditure in context. They will produce a
quarterly report that will provide Board with oversight as an
output of the governance review.
Governance & Remuneration Committee - previously
Remuneration & Nominations Committee
The Group's Remuneration & Nominations Committee was renamed
on 1 October 2020 as the new governance structure came into place.
It met twice before the new structure and twice in its new form in
the second half of the year. The Committee has responsibility for
remuneration policies and reviews Chief Executive performance and
pay and that of the other executive directors. The Committee
overseas Board, Committee and Executive recruitment and facilitates
the annual Board appraisal and effectiveness reviews. In addition,
the Committee has delegated responsibility for governance and works
with the Head of Governance over matters such as Board and
Committee appraisal, training and initiatives such as the recent
governance review.
Homes & Services Committee
Meetings of the Homes & Services Committee were suspended
when the lockdown happened in the spring 2020. The Committee did
meet once in September for a strategy day, however following that
the Committee was retired on 30 September 2020 as part of the new
governance structure.
Customer Experience Committee
This new Committee was launched on 1 October 2020 as part of the
new governance structure and it has met twice in the second half of
the year. The purpose includes areas of specific interest to
customers such as customer experience of services provided,
community investment, routine maintenance, performance and customer
feedback.
Funding Committee
This Committee met three times during the first half of the year
to oversee the funding arrangements and quarterly covenant
compliance. As part of the new governance structure, the Committee
was retired on 30 September 2020. A new forum, Funding Group, which
sits outside of the governance structure, was formed on 1 October
2020. The purpose of the group is to scrutinise any funding
requirements, as directed by the Board.
Regulator of Social Housing Regulatory Framework
The Board reviews annually its compliance with the Regulatory
Framework and confirms that it complies fully with its requirements
at year end. However, we did identify a minor breach of the Rent
Standard in August 2020, which was reported to the Regulator along
with the action that we had taken to address the breach. The
feedback received from the Regulator was that they were taking no
further action.
National Housing Federation Code of Governance 2015
In 2016, the Board adopted the National Housing Federation's
"Code of Governance: Promoting board excellence for housing
associations (2015 edition)". The Board reviews the Code annually
and confirms it complies fully. The Board is aware that the new
Code was released in November 2020 and Grand Union will be adopting
this from 1 April 2021.
Executive Directors
Grand Union's Executive Officers have no interest in the Group's
share capital, and although they do not have the legal status of
Directors, they act as an Executive within the authority delegated
by the Board and are termed Director. The Board has delegated the
day-to-day management and the implementation of its strategy and
policies to the Group Chief Executive and other senior officers.
The Executive Management team meets regularly, and its members
attend Boards, Committees, the Groups outside of the governance
structure detailed above, and stakeholder panels.
Directors' and Officers' Liability Insurance
The Group has purchased Directors' and Officers' Liability
Insurance for the Board, Executive Officers and staff of the
Group.
Employees
The ability of the Group to meet its objectives and commitments
to customers in an efficient and effective manner depends on the
contribution, commitment and quality of its colleagues. Grand Union
provides training programmes focusing on quality and customer
service requirements, and the Group's objectives and progress are
discussed at regular management and departmental meetings. Managers
throughout Grand Union attend training to improve their leadership
and management skills.
Grand Union is committed to equal opportunities for all its
employees and strives to attain an inclusive culture and building
on achieving a diverse as possible workforce, through its Belonging
Strategy. We have effective employment policies in place, which are
reviewed on a regular basis. All existing colleagues have been
provided with diversity and inclusion training, whilst new members
of staff are trained during the induction process.
The Board is aware of its responsibilities on all matters
relating to health and safety. The Group has detailed health and
safety policies and provides job specific training to
colleagues.
The Governance and Viability Standard
Following the annual review, the Regulator of Social Housing
reconfirmed the status of the Group as G1/V1 in November 2020,
indicating that the highest standards of governance and financial
viability are being met. The Board confirm compliance with this
standard.
Risk management & internal controls
At Grand Union we recognise that some managed risk-taking is
essential if we are to meet our objectives. Therefore, we are
committed to a 'risk aware' rather than a 'risk averse' culture and
we acknowledge that risk cannot always be eliminated from the
activities we undertake. We ensure that we have a robust approach
to risk management with enough resources allocated to ensure risk
is managed effectively.
The Regulator of Social Housing requires that we have an
effective risk management and internal controls assurance
framework. Our framework includes our strategic approach to risk,
our methodology for the assessment of risks, reporting mechanisms,
timing, and specific risk management responsibilities.
Risk Management Framework
Our risk management framework and risk management policy include
robust processes to manage risk in support of the achievement of
Grand Union's objectives, protect our staff and business assets and
ensure financial sustainability.
Like all businesses, Grand Union's activities are not free from
risk. We have a moral and statutory duty of care to our customers
and employees and as such we safeguard and make proper use of our
assets through the practical application of the methods our risk
management framework describes. The Risk Management Strategy at
Grand Union is built upon fundamental principles that recognises
that ultimate responsibility for risk management lies with the
Board and that the management of risk is a continuous process
involving regular monitoring and where necessary re-tuning.
The Board and Audit & Risk Committee review the Group risk
register each quarter. Other Committees (made up of members from
either Board or the Executive Management Team) also review the risk
register on a regular basis and our independent internal auditors
set out an annual audit plan, created from our risk register and
their knowledge of the housing sector. In addition, the management
of risk is subjected to external scrutiny on a periodic basis.
The Risk Management framework is reviewed and amended, if
appropriate, on an annual basis and is approved by the Audit &
Risk Committee and the Board.
Roles & responsibilities
Emerging risk
Everyone at Grand Union (colleagues, Leadership team, Committees
and Board) has a responsibility to identify risks. All newly
identified risks are logged on the Group risk register. The
emerging risks are then assessed as part of regular strategic risk
review meetings.
Risk appetite
The annual performance and financial targets at Grand Union are
set in line with the risk appetite, where quantitative measures can
be identified. The risk appetite statements set out guidance for
the qualitative areas of the business.
On an annual basis the Board will review and set its risk
appetite against all our key risk areas, ranging from averse to
hungry, defined as follows:
-- Averse - avoidance of risk and uncertainty is a key
organisational objective.
-- Minimal - Always opt for very safe delivery options that have
a low degree of inherent risk even though they may give limited
potential reward.
-- Cautious - Preference for safe delivery options that have a
low degree of inherent risk that may only have limited potential
for reward.
-- Open - Willing to consider all potential delivery options and
choose the option that is most likely to result in successful
delivery and which provides an acceptable level of reward.
-- Hungry - Eager to be innovative and to choose options based
on higher rewards despite potential greater inherent risk.
A risk appetite matrix has been developed and is updated
annually as a minimum that reflects what each risk appetite range
means for all key risk areas. Activities which could potentially
have a major adverse impact on Grand Union (regardless of any
control mechanisms in place) are not undertaken without explicit
approval by the Board.
Wherever possible all Board reports include an assessment of
risk to Grand Union. Risk appetite is not a single fixed concept.
Grand Union has a range of appetites for different risks, and
indeed these appetites may well vary over time as circumstances
change. The appropriate risk appetite statement areas are expressed
in words and then a score assigned to each specific statement area.
Our risk framework defines the extent to which risk is encouraged
and tolerated.
Three lines model
Grand Union uses the three lines model which provides us with a
standardised and comprehensive risk management process that clearly
outlines the roles of various leaders within GUHG, including
oversight by the Board. An assurance can include a key performance
indicator, an internal audit report, external validation, a
document, report, or other method of verification which provides an
opinion on the operation of the controls in place to manage the
risk.
The three categories of assurance are recorded based on an
increasing level of independent oversight of the risk and current
performance. Assurances are noted against each risk on the risk
register.
Strategic risks - heat map
Our 14 strategic risks at the year end are plotted on the heat
map below with the residual risk rating - which is the amount of
risk that remains after the controls that Grand Union has in place
are accounted for.
A - Sales Income H - Political Environment
B - Brexit I - Pension Liability Increase
C - Data Processing Breach J - Strategic Partnerships
D - Environmental Sustainability K - COVID-19 Outbreak
E - Achievement of Business Growth L - Ineffective Business Planning
F - Liquidity Requirement Levels M - Staffing Levels
G - Regulatory Framework Failure N - Change Management
Key risks and uncertainties
As we begin looking ahead to the new financial year, we continue
to face challenges due to the ever-changing risk landscape and the
implications that may have on our own internal resources and for
those of our residents.
The four risks identified below are those which are currently
seen as presenting the greatest potential impact on our business
and achievement of business objectives. However, our continuous
monitoring process ensures that risks are identified and assessed
in response to the often challenging environment that we operate
in.
A - Sales income
-- Speed of sales completion
-- Restricted mortgage availability
-- Delayed land ownership
-- Increased competition
Potential Impacts Mitigations
causes
--
Changes * Cashflow * New Business & Development Strategy tenure details
in the balance and exposure levels
housing
market * Expected income from sales activities not realised
* Business plan stress testing
* Additional interest costs
* Standard approach to scheme feasibility modelling
* Additional cost incurred due to increased promotion
and incentives * Individual scheme approval through agreed decision
making framework (Board & Investment & Development
Group)
* Reduced new homes delivery capacity
* Tenure changes (with grant support)
* Reputational
---------- ---------------------------------------------------------- ---------------------------------------------------------
B- Brexit
Potential causes Impacts Mitigations
-- Uncertainty and economic
outcomes arising from the * Supply chain disruption * Treasury advisors engaged
agreement
* Cost increase * Long term re-financing options in place
* Reduced demand for products * Continuous review of stress test scenarios
* Housing market downturn
----------------------------- ---------------------------------- -------------------------------------------------
C - Data processing breach
-- Unauthorised access to data by a deliberate external attack e.g. cyber crime
Potential Impacts Mitigations
causes
--
Unintentional * Fines up to GBP17.5m or 4% of annual turnover by the * Software in place to check attachments and recipients
disclosure of ICO of emails
personal
information
to an * Disruption to operations when recovering from an * Sophisticated firewall, penetration and anti-virus
external attack software in place.
party
* Reputational damage * Regular phishing simulations for all staff to raise
awareness of attacks
* Regulatory downgrade
* Cyber essentials accreditation
* Cyber insurance in place to cover recovery costs
associated with attack and any fines imposed
-------------- ----------------------------------------------------------- ------------------------------------------------------------
D - Environmental sustainability
-- Additional cost of building new homes is too high
Potential Impacts Mitigations
causes
--
Retrofitting * Inability to comply with the UK Government zero * Repairs include renewable energy technology
of existing emissions strategy
stock
* Utilise available government funding
* Covenant compliance impact
* Covenant carve - out negotiations
------------- ---------------------------------------------------------- --------------------------------------------------
Disclosure of information to the auditor
The Board members at the date of approval of this report have
confirmed that:
-- as far as the Board members are aware, there is no relevant
audit information of which the Group's auditor is unaware
-- the Board members have taken all the steps that they ought to
have taken as Board members in order to make themselves aware of
any relevant audit information and to establish that the Group's
auditor is aware of that information.
Going concern
The Group's activities, together with the factors likely to
affect its future development, its financial position, financial
risk management objectives, details of its financial instruments
and derivative activities, and its exposures to credit, liquidity
and cash flow risk are described above and in the Board Report.
The Group has considerable financial resources and, as a
consequence, the Board believes that the Group is well placed to
manage its business risks successfully, despite current
uncertainties in the social housing sector.
After making enquiries, the Board expects that the Group has
adequate resources to continue in operational existence for the
foreseeable future. Accordingly, it continues to adopt the going
concern basis in preparing the financial statements.
Approved by the Board and signed on its behalf by:
James Macmillan 27 July 2021
Chair
Grand Union Housing Group
Board Report
Details of Grand Union Housing Group Limited's principal
activities, its financial performance, VfM and factors likely to
affect its future are given in the Strategic Report, which preceded
this report.
Statement of Board members' responsibilities
The Board is responsible for preparing the report and financial
statements in accordance with applicable law and regulations.
The Co-operative and Community Benefit Societies Act 2014 and
registered social housing legislation require the Board to prepare
financial statements for each financial year which give a true and
fair view of the state of affairs of the Group and Association and
of the Income and Expenditure for the period of account.
In preparing these financial statements, the Board is required
to:
-- Select suitable accounting policies and then apply them consistently,
-- Make judgements and estimates that are reasonable and prudent,
-- State whether applicable accounting standards have been
followed, subject to any material departures disclosed and
explained in the financial statements, and
-- Prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group and
Association will continue in business.
The Board has overall responsibility for establishing and
maintaining the whole system of internal control and for reviewing
its effectiveness within the Group.
The Board recognises that no system of internal control can
provide absolute assurance or eliminate all risk. The system of
internal control is designed to manage risk and to provide
reasonable assurance that key business objectives and expected
outcomes will be achieved. It can also give reasonable assurance
about the preparation and reliability of financial and operational
information and the safeguarding of the Group's assets and
interests.
In meeting its responsibilities, the Board has adopted a
risk-based approach to internal controls which is embedded within
normal management and governance processes. This approach includes
the regular evaluation of the nature and extent of risks to which
the Group is exposed. The process adopted by the Board in reviewing
the effectiveness of the system of internal control together with
some of the key elements of the control framework includes:
-- Identification and evaluation of key risks - Management
responsibility has been clearly defined for the identification,
evaluation and control of significant risks. There is a formal and
ongoing process of management review in each area of the Group's
activities. The Executive Management team regularly considers
reports on significant risks facing the Group and is responsible
for reporting to the Board any significant changes affecting key
risks.
-- Monitoring and corrective action - A process of control,
self-assessment and regular management reporting on control issues
provides hierarchical assurance to successive levels of management
and to the Board. This includes a rigorous procedure for ensuring
that corrective action is taken in relation to any significant
control issues, particularly those with a material impact on the
financial statements.
-- Control environment and control procedures - The Board
retains responsibility for a defined range of issues covering
strategic, operational, financial and compliance issues including
treasury strategy and new investment projects. The Board has
adopted the NHF Code of Governance 2015. In addition, the Group has
policies with regard to the quality, integrity and ethics of its
employees and these are supported by a framework of policies and
procedures with which employees must comply.
These cover issues such as delegated authority, segregation of
duties, accounting, treasury management, health and safety, data
and asset protection and fraud prevention and detection.
-- Information and financial reporting systems - Financial
reporting procedures include detailed budgets for the year ahead
and forecasts for subsequent years. These are reviewed and approved
by the Board. The Board also regularly reviews key performance
indicators to assess progress towards the achievements of key
business objectives, targets and outcomes.
-- Fraud - The Group has in place policies in respect of
preventing, detecting and investigating fraud and the Board is
satisfied that these effectively manage the risk of fraud. The
Group has a Whistleblowing policy that covers Board members,
employees and customers.
The internal control framework and the risk management process
are subject to regular review by Internal Audit who are responsible
for providing independent assurance to the Board via its Audit
& Risk Committee.
The Board has received the Group Chief Executive's annual
report, has conducted its annual review of the effectiveness of the
system of internal control and has taken account of any changes
needed to maintain the effectiveness of the risk management and
control process. No attempts or successful frauds were carried out
against the Group in 2020/21.
The Board confirms that there is an ongoing process for
identifying, evaluating and managing significant risks faced by the
Group. This process has been in place throughout the year under
review, up to the date of the annual report, and is regularly
reviewed by the Board.
Auditor
KPMG were appointed as Internal Auditors in May 2019, and Beever
and Struthers were appointed as External Auditors in January
2020.
Statement of Compliance
The Board has followed the principles set out in the Statement
of Recommended Practice (SORP) for Registered Social Providers
2018. The Group has fully complied with the Accounting Direction
for Private Registered Providers of Social Housing 2019.
Approved by the Board and signed on its behalf by:
James Macmillan 27 July 2021
Chair
Grand Union Housing Group
Independent auditor's report to the members of Grand Union
Housing Group Limited
Opinion
We have audited the financial statements of Grand Union Housing
Group Limited (the 'Association') and its subsidiaries (the
'Group') for the year ended 31 March 2021 which comprise the
Consolidated and Association Statement of Comprehensive Income,
Consolidated and Association Statement of Financial Position,
Consolidated and Association Statement of Changes in Reserves,
Consolidated Statement of Cash Flows and the notes to the financial
statements, including a summary of significant accounting policies
in notes 1 and 2. The financial reporting framework that has been
applied in their preparation is applicable law and United Kingdom
Accounting Standards, including FRS 102 "The Financial Reporting
Standard applicable in the UK and Republic of Ireland" (United
Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
-- give a true and fair view of the state of the Group's and of
the Association's affairs as at 31 March 2021 and of the Group's
income and expenditure and the Association's income and expenditure
for the year then ended;
-- have been properly prepared in accordance with United Kingdom
Generally Accepted Accounting Practice; and
-- have been prepared in accordance with the requirements of the
Co-operative and Community Benefit Societies Act 2014, the
Co-operative and Community Benefit Societies (Group Accounts)
Regulations 1969, the Housing and Regeneration Act 2008 and the
Accounting Direction for Private Registered Providers of Social
Housing 2019.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the
Auditor's responsibilities for the audit of the financial
statements section of our report. We are independent of the Group
and Association in accordance with the ethical requirements that
are relevant to our audit of the financial statements in the UK,
including the FRC's Ethical Standard, and we have fulfilled our
other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the
Board's use of the going concern basis of accounting in the
preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
Group's or the Association's ability to continue as a going concern
for a period of at least twelve months from when the financial
statements are authorised for issue.
Our responsibilities and the responsibilities of the Board with
respect to going concern are described in the relevant sections of
this report.
Other information
The other information comprises the information included in the
Strategic Report, other than the financial statements and our
auditor's report thereon. The Board is responsible for the other
information. Our opinion on the financial statements does not cover
the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial statements our
responsibility is to read the other information and in doing so,
consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If we
identify such material inconsistencies or apparent material
misstatements, we are required to determine whether there is a
material misstatement in the financial statements or a material
misstatement of the other information. If, based on the work we
have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact.
We have nothing to report in this regard.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters in
relation to which the Co-operative and Community Benefit Societies
Act 2014 or the Housing and Regeneration Act 2008 requires us to
report to you if, in our opinion:
-- the Association has not maintained a satisfactory system of control over transactions; or
-- the Association has not kept proper accounting records; or
-- the Association's financial statements are not in agreement with books of account; or
-- we have not received all the information and explanations we require for our audit.
Responsibilities of the Board
As explained more fully in the Statement of Board Members'
Responsibilities set out on pages 44 - 45, the Board is responsible
for the preparation of the financial statements and for being
satisfied that they give a true and fair view, and for such
internal control as the Board determines is necessary to enable the
preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Board is responsible
for assessing the Group's and the Association's ability to continue
as a going concern, disclosing, as applicable, matters related to
going concern and using the going concern basis of accounting
unless the Board either intends to liquidate the Group or the
Association or to cease operations, or has no realistic alternative
but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's web-site at www.frc.org.uk/auditorsresponsibilities .
This description forms part of our auditor's report.
Extent to which the audit was considered capable of detecting
irregularities, including fraud
We identify and assess the risks of material misstatement of the
financial statements, whether due to fraud or error, and then
design and perform audit procedures responsive to those risks,
including obtaining audit evidence that is sufficient and
appropriate to provide a basis for our opinion.
In identifying and addressing risks of material misstatement in
respect of irregularities, including fraud and non-compliance with
laws and regulations, our procedures included the following:
-- We obtained an understanding of laws and regulations that
affect the Group and Association, focusing on those that had a
direct effect on the financial statements or that had a fundamental
effect on its operations. Key laws and regulations that we
identified included the Co-operative and Community Benefit
Societies Act 2014, the Statement of Recommended Practice for
registered housing providers: Housing SORP 2018, the Housing and
Regeneration Act 2008, the Accounting Direction for Private
Registered Providers of Social Housing 2019, tax legislation,
health and safety legislation, and employment legislation.
-- We enquired of the Board and reviewed correspondence and
Board meeting minutes for evidence of non-compliance with relevant
laws and regulations. We also reviewed controls the Board have in
place, where necessary, to ensure compliance.
-- We gained an understanding of the controls that the Board
have in place to prevent and detect fraud. We enquired of the Board
about any incidences of fraud that had taken place during the
accounting period.
-- The risk of fraud and non-compliance with laws and
regulations was discussed within the audit team and tests were
planned and performed to address these risks. We identified the
potential for fraud in the following areas: laws related to the
construction and provision of social housing recognising the
regulated nature of the Group's activities.
-- We reviewed financial statements disclosures and tested to
supporting documentation to assess compliance with relevant laws
and regulations discussed above.
-- We enquired of the Board about actual and potential litigation and claims.
-- We performed analytical procedures to identify any unusual or
unexpected relationships that might indicate risks of material
misstatement due to fraud.
-- In addressing the risk of fraud due to management override of internal controls we tested the appropriateness of journal entries and assessed whether the judgements made in making accounting estimates were indicative of a potential bias.
Due to the inherent limitations of an audit, there is an
unavoidable risk that we may not have detected some material
misstatements in the financial statements, even though we have
properly planned and performed our audit in accordance with
auditing standards. For example, as with any audit, there remained
a higher risk of non-detection of irregularities, as these may
involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal controls. We are
not responsible for preventing fraud or non-compliance with laws
and regulations and cannot be expected to detect all fraud and
non-compliance with laws and regulations.
Use of our report
This report is made solely to the Association, in accordance
with section 87 of the Co-operative and Community Benefit Societies
Act 2014 and Section 128 of the Housing and Regeneration Act 2008.
Our audit work has been undertaken so that we might state to the
Association those matters we are required to state to it in an
auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the Association for our audit work, for this
report, or for the opinions we have formed.
Beever and Struthers
Statutory Auditor
St George's House
215-219 Chester Road
Manchester
M15 4JE
Date: 24 August 2021
Grand Union Housing Group
Consolidated Statement of Comprehensive Income
As at 31 March 2021
2021 2020
Note GBP'000 GBP'000
Turnover 3a 74,943 71,166
Cost of sales 3a (5,821) (4,165)
Operating expenditure 3a (48,374) (45,942)
Gain on disposal of housing properties,
plant & equipment 4 1,764 3,455
Operating surplus 22,512 24,514
Interest receivable 5 251 405
Interest and financing costs 6 (14,313) (14,453)
Movement in fair value of financial
Instruments 13 (895) -
Surplus before tax 7,555 10,466
Taxation 10 - -
Surplus for the year 7,555 10,466
Other comprehensive income
Actuarial (deficit)/surplus in respect
of defined benefit pension schemes 19 (735) 2,954
Total comprehensive income for the
year 6,820 13,420
All of the activity above relates to continuing activities.
James Macmillan Gillian Walton Mandy Hopkins
Chair Senior Independent Director Company Secretary
Date: 27 July 2021
The notes on pages 57 - 91 form an integral part of these
financial statements.
Grand Union Housing Group
Association Statement of Comprehensive Income
For the year ended 31 March 2021
Note 2021 2020
GBP'000 GBP'000
Turnover 3a 72,527 69,445
Cost of sales 3a (3,687) (2,707)
Operating expenditure 3a (48,374) (45,942)
Gain on disposal of housing properties,
plant & equipment 4 1,764 3,455
Operating surplus 22,230 24,251
Interest receivable 5 604 746
Interest and financing costs 6 (14,313) (14,453)
Movement in fair value of financial instruments 13 (895) -
Surplus before tax 7,626 10,544
Taxation 10 - -
Surplus for the year 7,626 10,544
Other comprehensive income
Actuarial (deficit)/surplus in respect
of defined benefit pension schemes 19 (735) 2,954
Total comprehensive income for the year 6,891 13,498
All of the activity above relates to continuing activities.
James Macmillan Gillian Walton Mandy Hopkins
Chair Senior Independent Director Company Secretary
Date: 27 July 2021
The notes on pages 57 - 91 form an integral part of these
financial statements.
Grand Union Housing Group
Consolidated Statement of Financial Position
As at 31 March 2021
2021 2020
Note GBP'000 GBP'000
Fixed assets
Housing properties 11 634,188 609,959
Other property, plant and equipment 12a 2,136 4,856
Investment properties 13 23,500 17,896
Intangible assets 12b 457 314
660,281 633,025
Current assets
Stock 15 15,684 12,063
Debtors 16 7,312 7,750
Cash and cash equivalents 21 18,255 18,185
41,251 37,998
Creditors: Amounts falling due within
one year 17 (22,629) (16,018)
Net current assets 18,622 21,980
Total assets less current liabilities 678,903 655,005
Creditors: Amounts falling due after
more than one year 18 (328,896) (312,922)
Defined benefit pension liability 19 (14,683) (13,579)
Net assets 335,324 328,504
Capital and reserves
Share capital 20 - -
Revenue reserve 150,917 143,139
Revaluation reserve 184,407 185,365
Total reserves 335,324 328,504
The financial statements of Grand Union Housing Group were
approved by the Board and signed on its behalf by:
James Macmillan Gillian Walton Mandy Hopkins
Chair Senior Independent Director Company Secretary
Date: 27 July 2021
The notes on pages 57 - 91 form an integral part of these
financial statements.
Grand Union Housing Group
Association Statement of Financial Position
As at 31 March 2021
2021 2020
Note GBP'000 GBP'000
Fixed assets
Housing properties 11 634,188 609,959
Other property, plant and equipment 12a 2,136 4,856
Investment properties 13 23,500 17,896
Fixed asset investments 14 50 50
Intangible assets 12b 457 314
660,331 633,075
Current assets
Stock 15 8,622 6,168
Debtors 16 14,911 14,064
Cash and cash equivalents 21 18,184 18,078
41,717 38,310
Creditors: Amounts falling due within
one year 17 (22,667) (15,973)
Net current assets 19,050 22,337
Total assets less current liabilities 679,381 655,412
Creditors: Amounts falling due after
more than one year 18 (328,896) (312,922)
Defined benefit pension liability 19 (14,683) (13,579)
Net assets 335,802 328,911
Capital and reserves
Share capital 20 - -
Revenue reserve 151,395 143,546
Revaluation reserve 184,407 185,365
Total reserves 335,802 328,911
The financial statements of Grand Union Housing Group,
registered number 7853, were approved by the Board and signed on
its behalf by:
James Macmillan Gillian Walton Mandy Hopkins
Chair Senior Independent Director Company Secretary
Date: 27 July 2021
The notes on pages 57 - 91 form an integral part of these
financial statements.
Grand Union Housing Group
Consolidated Statement of Changes in Reserves
For the year ended 31 March 2021
Revenue Revaluation Total
reserve reserve reserves
GBP'000 GBP'000 GBP'000
At 1 April 2020 143,139 185,365 328,504
Surplus for the year
7,555 - 7,555
Other comprehensive income:
Actuarial deficit in respect of defined
benefit pension schemes (735) - (735)
Total comprehensive income 6,820 - 6,820
Reserve transfers 958 (958) -
At 31 March 2021 150,917 184,407 335,324
Revenue Revaluation Total
reserve reserve reserves
GBP'000 GBP'000 GBP'000
At 1 April 2019 127,746 187,338 315,084
Surplus for the year 10,466 - 10,466
Other comprehensive income:
Actuarial surplus in respect of defined
benefit pension schemes 2,954 - 2,954
Total comprehensive income 13,420 - 13,420
Reserve transfers 1,973 (1,973) -
At 31 March 2020 143,139 185,365 328,504
Reserves
Revenue reserve
The revenue reserve represents cumulative surpluses and deficits
of the Group.
Revaluation reserve
The revaluation reserve relates to cumulative historic valuation
uplifts arising before 1 April 2014.
The notes on pages 57 - 91 form an integral part of these
financial statements.
Grand Union Housing Group
Association Statement of Changes in Reserves
For the year ended 31 March 2021
Revenue Revaluation Total
reserve reserve reserves
GBP'000 GBP'000 GBP'000
At 1 April 2020 143,546 185,365 328,911
Surplus for the year 7,626 - 7,626
Other comprehensive income:
Actuarial deficit in respect of defined
benefit pension schemes (735) - (735)
Total comprehensive income 6,891 - 6,891
Reserve transfers 958 (958) -
At 31 March 2021 151,395 184,407 335,802
Revenue Revaluation Total
reserve reserve reserves
GBP'000 GBP'000 GBP'000
At 1 April 2019 128,075 187,338 315,413
Surplus for the year 10,544 - 10,544
Other comprehensive income:
Actuarial surplus in respect of defined
benefit pension schemes 2,954 - 2,954
Total comprehensive income 13,498 - 13,498
Reserve transfers 1,973 (1,973) -
At 31 March 2020 143,546 185,365 328,911
Reserves
Revenue reserve
The Revenue reserve represents cumulative surpluses and deficits
of the Association .
Revaluation reserve
The revaluation reserve relates to cumulative historic valuation
uplifts arising before 1 April 2014.
The notes on pages 57 - 91 form an integral part of these
financial statements.
Grand Union Housing Group
Consolidated Statement of Cash Flows
For the year ended 31 March 2021
Note 2021 2020
GBP'000 GBP'000
Net cash generated from operating activities 21 27,451 26,600
Cash flows from investing activities
Purchase of property, plant and equipment (36,493) (39,114)
Purchase of investment property (6,499) (1,396)
Proceeds from sale of property, plant
and equipment 5,812 5,441
Grants received 7,411 9,775
Taxation - -
Interest received 251 405
Net cash flows from investing activities (29,518) (24,889)
Cash flows from financing activities
Interest paid (14,313) (14,453)
Net loan movement 16,450 2,952
Net cash flows from financing activities 2,137 (11,501)
Net increase/(decrease) in cash and
cash equivalents 70 (9,790)
Cash and cash equivalents at beginning
of year 18,185 27,975
Cash and cash equivalents at end of
year 18,255 18,185
The notes on pages 57 - 91 form an integral part of these
financial statements.
Grand Union Housing Group
Notes to the financial statements
For the year ended 31 March 2021
1. Accounting policies
Grand Union Housing Group Limited (the 'Association') is a
private limited company incorporated and domiciled in England. The
address of the registered office is K2, Timbold Drive, Kents Hill,
Milton Keynes, Bucks, MK7 6BZ. The registered number is 7853.
The main activities of the Group are the provision of affordable
homes for people in housing need. The principal accounting policies
are summarised below. They have all been applied consistently
throughout the year and to the preceding year.
General information and basis of accounting
The financial statements have been prepared under the historical
cost convention, modified to include certain items at fair value,
in accordance with FRS 102 "The Financial Reporting Standard
applicable in the UK and Republic of Ireland" (FRS 102) and comply
with the Statement of Recommended Practice for Registered Social
Housing Providers 2018 (SORP), the Housing and Regeneration Act
2008 and the Accounting Direction for Private Registered Providers
of Social Housing 2019. The Group is a public benefit entity, as
defined in FRS 102 and applies the relevant paragraphs prefixed
'PBE' in FRS 102.
Grand Union Housing Group meets the definition of a qualifying
entity under FRS 102 and has therefore taken advantage of the
disclosure exemptions available to it in respect of its separate
financial statements, which are presented alongside these
consolidated financial statements. Exemptions have been taken in
relation to the following:
-- A Statement of Cash Flows has not been presented for the parent company
FRS 102 allows a qualifying entity certain disclosure exemption,
subject to certain conditions, which has been complied with. In
preparing the Association's individual financial statements, the
Association has taken advantage of the exemption not to provide
certain disclosures as required by Section 11 "Basic Financial
Instruments" and Section 12 "Other Financial Instrument Issues" and
"Related Party Transactions" on the basis that equivalent
disclosures are given in the consolidated financial statements.
Property, plant and equipment - housing properties at cost
Housing properties are stated at cost less accumulated
depreciation and accumulated impairment losses. Cost includes the
cost of acquiring land and buildings, directly attributable
development costs and borrowing costs directly attributable to the
construction of new housing properties during the development
calculated at the weighted average cost of capital during 2020/21.
Capitalisation ceases when substantially all the activities that
are necessary to prepare the asset for use are complete.
Property, plant and equipment - housing properties at deemed
cost
Where housing properties were measured at fair value at the date
of transition to FRS 102 and this valuation was used as deemed
cost, taking advantage of the exemption available on transition to
FRS 102 from previous UK GAAP, this was considered to be a
valuation and a revaluation reserve established to account for the
movement.
A release of the revaluation reserve is calculated to reflect
the additional depreciation that has been charged on the uplift to
the structure cost upon moving to deemed cost.
Depreciation is charged so as to write down the net book value
of housing properties to their estimated residual value, on a
straight-line basis, over their useful economic lives. Freehold
land is not depreciated.
Major components
Major components of housing properties, which have significantly
different patterns of consumption of economic benefits, are treated
as separate assets and depreciated over their expected useful
economic lives at the following annual rates:
Structure:
Standard 100 years
- Properties built by pre-reinforced concrete method with certificate 50 years
- Properties built by pre-reinforced concrete method without certificate 10 years
Roofs 50 years
Heating systems 40 years
Doors, windows, bathrooms, lifts, wiring, insulation and high-level works 30 years
Solar panels 25 years
Kitchens and heat pumps 20 years
Heating boilers 15 years
If the component is replaced before the end of its economic
life, the resulting charge will be reflected in the overall
depreciation charge rather than a loss on its replacement.
Properties held on long leases are depreciated over their
estimated useful economic lives or the lease duration if
shorter.
Improvements
Where there are improvements to housing properties that are
expected to provide incremental future benefits, these are
capitalised and added to the carrying amount of the property. Any
works to housing properties which do not replace a component or
result in an incremental future benefit are charged as expenditure
in surplus or deficit in the Statement of Comprehensive Income.
Sales of Housing Property
Sales of housing property are taken into account on completion
of contracts. The surplus or deficit arising from the sale is shown
net after deducting the carrying value of the property and any sale
related expense.
Non-housing property, plant and equipment
Non-housing property, plant and equipment are stated at historic
cost less accumulated depreciation and any provision for
impairment. Depreciation is provided on all non-housing property,
plant and equipment, other than investment properties and freehold
land, at rates calculated to write off the cost or valuation, less
estimated residual value, of each asset on a straight-line basis
over its expected useful life.
Expected useful lives are as follows:
Freehold offices 50 years
Office improvements 25 years
Leasehold improvements 10 years
Office fixtures 10 years
Office heating and mechanical 5 years
Furniture and fittings 5 years
Vehicles 4 years
Computer equipment 3 years
Intangible assets
Intangible assets are stated at historic cost, less accumulated
amortisation. Amortisation is provided on all intangible assets at
rates calculated to write-off the cost of each asset on a
straight-line basis over its expected useful life, as follows:
Computer software 3 years
Investment properties
The classification of properties as investment property or
property, plant and equipment is based upon the intended use of the
property. Properties held to earn commercial rentals or for capital
appreciation or both are classified as investment properties.
Properties that are used for administrative purposes or that are
held for the provision of social housing are treated as property,
plant and equipment. Mixed use property is separated between
investment property and property, plant and equipment.
Land is accounted for based on its intended use. Where land is
acquired speculatively with the intention of generating a capital
gain and/or a commercial rental return it is accounted for as
investment property. Where land is acquired for use in the
provision of social housing or for a social benefit it is accounted
for as property, plant and equipment.
Investment properties are measured at fair value annually with
any change recognised in surplus or deficit in the Statement of
Comprehensive Income.
Impairment of social housing properties
Properties held for their social benefit are not held solely for
the cash inflows they generate and are held for their service
potential. The Group has identified a cash generating unit for
impairment assessment purposes at a property scheme level.
An assessment is made at each reporting date as to whether an
indicator of impairment exists. If such an indicator exists, an
impairment assessment is carried out and an estimate of the
recoverable amount of the asset is made. Where the carrying amount
of the asset exceeds its recoverable amount, an impairment loss is
recognised in surplus or deficit in the Statement of Comprehensive
Income. The recoverable amount of an asset is the higher of its
value in use and fair value less costs to sell. Where assets are
held for their service potential, value in use is determined by the
present value of the asset's remaining service potential plus the
net amount expected to be received from its disposal. Depreciated
replacement cost is taken as a suitable measurement model.
An impairment loss is reversed if the reasons for the impairment
loss have ceased to apply and is included in surplus or deficit in
the Statement of Comprehensive Income.
As part of the end of year review of the carrying value of
properties under construction, three schemes were identified and
resulted in a write down of GBP716k.
Social Housing Grant and other government grants
Grants received in relation to assets that have been treated as
deemed cost at the date of transition to FRS 102 have been
accounted for using the performance model. In applying this model
such grant has been presented as if it were originally recognised
as income within the statement of comprehensive income in the year
it was receivable and is therefore included within brought-forward
general reserves.
Grants received since transition in relation to newly acquired
or existing housing properties are accounted for using the accrual
model. Grant is carried as deferred income in the balance sheet and
is amortised on a systematic basis over the useful life of the
housing property structure, even if the fair value of the grant
exceeds the carrying value of the structure in line with SORP 2018.
No grant is recognised against other components.
When a housing property is sold which was partly funded by
social housing grant (SHG) the grant becomes repayable and is
transferred to a Recycled Capital Grant (RCGF) fund until it is
either reinvested in a replacement property or repaid to the
Regulator of Social Housing.
Leased assets
At inception the Group assesses agreements that transfer the
right to use assets. The assessment considers whether the
arrangement is, or contains, a lease based on the substance of the
arrangement.
Operating leased assets
Leases that do not transfer all the risks and rewards of
ownership are classified as operating leases. Payments under
operating leases are charged to surplus or deficit in the Statement
of Comprehensive Income on a straight-line basis over the period of
the lease.
Interest payable
Borrowing costs are interest and other costs incurred in
connection with the borrowing of funds. Borrowing costs are
calculated using the effective interest rate, which is the rate
that exactly discounts estimated future cash payments or receipts
through the expected life of a financial instrument and is
determined on the basis of the carrying amount of the financial
liability at initial recognition.
Under the effective interest method, the amortised cost of a
financial liability is the present value of future cash payments
discounted at the effective interest rate and the interest expense
in a period equals the carrying amount of the financial liability
at the beginning of a period multiplied by the effective interest
rate for the period.
Taxation
The majority of the Group's activities are charitable and are
conducted through the Registered Provider which has charitable
status. No taxation is payable on activities relating to charitable
purposes. Any charge for taxation is based on the surplus/deficit
for the year and recognises deferred taxation because of timing
differences between the treatment of certain items for taxation and
accounting purposes. Provision is made for deferred tax on a full
provision basis.
Value Added Tax (VAT)
The Group is registered for VAT but a large proportion of its
income, including rents, is exempt for VAT purposes. The majority
of the Group's expenditure is subject to VAT which cannot be
reclaimed, and expenditure is therefore shown inclusive of VAT
where appropriate. For those areas where VAT is recoverable, a
group partial exemption formula has been agreed with HM Revenue and
Customs (HMRC). The recoverable amount is credited against the
relevant expenditure.
Pensions
Local Government Pension Scheme
The group participates in a local government pension scheme
which is a multi-employer scheme where it is possible for
individual employers as admitted bodies to identify their share of
the assets and liabilities of the pension scheme. For this scheme
the amounts charged to operating surplus are the costs arising from
employee services rendered during the period and the cost of plan
introductions, benefit changes, settlements and curtailments. They
are included as part of staff costs. The net interest cost on the
net defined benefit liability is charged to revenue and included
within finance costs. Re-measurement comprising actuarial gains and
losses and the return on scheme assets (excluding amounts included
in net interest on the net defined benefit liability) are
recognised immediately in other comprehensive income.
Defined benefit schemes are funded, with the assets of the
scheme held separately from those of the Group, in separate trustee
administered funds. Pension scheme assets are measured at fair
value and liabilities are measured on an actuarial basis using the
projected unit credit method. The actuarial valuations are obtained
at least triennially and are updated at each reporting date. This
scheme was closed to new members from 1 April 2013.
Multi-employer defined benefit pension scheme - Social Housing
Pension Scheme (SHPS)
The company participates in the Social Housing Pension Scheme
(the Scheme), a multi-employer scheme which provides benefits to
some 500 non-associated employers. The Scheme is a defined benefit
scheme in the UK. The Scheme is subject to the funding legislation
outlined in the Pensions Act 2004 which came into force on 30
December 2005. This, together with documents issued by the Pensions
Regulator and Technical Actuarial Standards issued by the Financial
Reporting Council, set out the framework for funding defined
benefit occupational pension schemes in the UK.
The Scheme is classified as a 'last-man standing arrangement'.
Therefore, the company is potentially liable for other
participating employers' obligations if those employers are unable
to meet their share of the scheme deficit following withdrawal from
the Scheme. Participating employers are legally required to meet
their share of the Scheme deficit on an annuity purchase basis on
withdrawal from the Scheme.
Defined contribution scheme
The Group participates in a defined contribution scheme where
the amount charged to surplus or deficit in the Statement of
Comprehensive Income in respect of pension costs and other
post-retirement benefits is the contributions payable in the year.
Differences between contributions payable in the year and
contributions actually paid are shown as either accruals or
prepayments in the Statement of Financial Position.
Investments
Investments are measured at cost less impairment.
Turnover
Turnover represents rental and service charge income, fees and
revenue-based grants receivable from local authorities and from
Homes England, the proceeds of first tranche sales of shared
ownership properties and open market property sales, housing
management services, feed in tariff income and assistive technology
services income.
Revenue for the main income streams is recognised as
follows:
Rent Revenue is measured at the fair value of
the consideration received or receivable
and represents the amount receivable for
the services rendered net of empty properties.
Service charge Fixed service charge income is recognised
income in the year to which it relates. Variable
service charge income is recognised in the
year the related cost is recognised.
------------------------------------------------------------
First tranche shared Property sales income is recognised when
ownership property the risks and rewards of ownership have passed
sales and properties to the buyer upon legal completion of the
developed for outright sales, except in circumstances where specific
sale legal contractual terms dictate that risks
and rewards of ownership pass at different
times.
------------------------------------------------------------
Revenue grants Revenue grants are recognised when the performance-related
conditions are met or when the grant proceeds
are received or become receivable if no conditions
are imposed.
------------------------------------------------------------
Amortisation of Grants provided to construct social housing
government grant assets are recognised on a systematic basis
over the useful economic life of the asset
for which the grant is intended to compensate.
------------------------------------------------------------
Interest receivable Interest income is recognised on a receivable
basis.
------------------------------------------------------------
Gift Aid Gift Aid is recognised on a received or receivable
basis.
------------------------------------------------------------
Other income Other income relates to housing management
services, feed in tariff income and assistive
technology services which are recognised
on a receivable basis.
------------------------------------------------------------
Supported housing and other managing agents
Where the Group has ownership of a supported housing or other
scheme but also has an agreement with a third party to manage the
scheme (including Supporting People funded schemes or services),
where there has been a substantial transfer of the risks and
benefits attached to the scheme to the third party, any scheme
revenue and expenditure is excluded from these financial
statements.
Shared ownership property sales
Shared ownership properties, including those under construction,
are split between non-current assets and current assets. The split
is determined by the percentage of the property to be sold under
the first tranche disposal which is shown on initial recognition as
a current asset, with the remainder classified as a non-current
asset within property plant and equipment. Where this would result
in a surplus on the disposal of the current asset that would exceed
the anticipated overall surplus, the surplus on disposal of the
first tranche is limited to the overall surplus by adjusting the
costs allocated to current or non-current assets.
Proceeds from first tranche disposals are accounted for as
turnover in the Statement of Comprehensive Income of the period in
which the disposal occurs and the cost of sale is transferred from
current assets to operating costs. Proceeds from subsequent tranche
sales are treated as disposals of fixed assets.
Inventories/WIP
Inventories and work in progress (WIP) relate to the percentage
of shared ownership properties to be sold under the first tranche
disposal which is shown on initial recognition as a current asset
under Inventories/WIP. These properties held for sale are measured
at the lower of cost and estimated selling price less costs to
complete and sell. Cost includes materials, direct labour and an
attributable proportion of overheads based on normal levels of
activity.
Financial instruments
Financial assets and financial liabilities are recognised when
the Group becomes a party to the contractual provisions of the
instrument.
Financial assets carried at amortised cost
Financial assets carried at amortised cost comprise rent
arrears, trade and other receivables and cash and cash equivalents.
Financial assets are initially recognised at transaction value plus
directly attributable transaction costs. After initial recognition,
they are measured at amortised cost using the effective interest
method. Discounting is omitted where the effect of discounting is
immaterial.
If there is objective evidence that there is an impairment loss,
the amount of the loss is measured as the difference between the
asset's carrying amount and the present value of estimated future
cash flows discounted at the financial asset's original effective
interest rate. The carrying amount of the asset is reduced
accordingly.
A financial asset is derecognised when the contractual rights to
the cash flows expire, or when the financial asset and all
substantial risks and reward are transferred.
If an arrangement constitutes a financing transaction, the
financial asset is measured at the present value of the future
payments discounted at a market rate of interest for a similar debt
instrument.
Financial liabilities carried at amortised cost
These financial liabilities include trade and other payables and
interest-bearing loans and borrowings.
A financial liability is initially recognised at transaction
value adjusted for any directly attributable transaction cost and
subsequently measured at amortised cost using the effective
interest method, with interest-related charges recognised as an
expense in finance costs in the Statement of Comprehensive Income.
Discounting is omitted where the effect of discounting is
immaterial.
A financial liability is derecognised only when the contractual
obligation is extinguished, that is, when the obligation is
discharged, cancelled or expires.
Loan issue costs relating to the housing loans and bond issue
are amortised to the Statement of Comprehensive Income over the
repayment period of the loans. Interest payable on the loans and
bond is charged to the Statement of Comprehensive Income in the
year it is due.
On long-term lending, the interest rate to be charged is
calculated by reference to the interest rates, margins and banking
charges within the loan agreements, with the funders, on the day
the loan is made.
Public benefit entity concessionary loans
Where loans are made or received between a public benefit entity
within the Group or an entity within the public benefit entity
group and other party at below the prevailing market rate of
interest that are not repayable on demand and are for the purposes
to further the objectives of the public benefit entity or public
benefit entity parent, these loans are treated as concessionary
loans and are recognised in the Statement of Financial Position at
the amount paid or received and the carrying amount adjusted to
reflect any accrued interest payable or receivable.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, and on demand
deposits, together with other short term, highly liquid investments
(with original maturities of three months or less) that are readily
convertible into known amounts of cash and are subject to an
insignificant risk of changes in value.
2. Significant management judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management
to make judgements, estimates and assumptions that affect the
application of policies and reported amounts of assets and
liabilities, income and expenses. The estimates and associated
assumptions are based on historical experience and various other
factors that are believed to be reasonable under the circumstances,
the results of which form the basis of making the judgements about
carrying values of assets and liabilities that are not readily
apparent from other sources. Actual results may differ from these
estimates.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised and in any future periods
affected.
Significant management judgements
The following are management judgements in applying the
accounting policies of the Group that have the most significant
effect on the amounts recognised in the financial statements.
Impairment of social housing properties
The Housing SORP 2018 requires the Group to assess if there are
any triggers for impairment. Management have considered the
triggers and confirmed no further impairment is required.
Categorisation of investment properties
Property assets are classified as investment property or
property, plant and equipment depending on the intended use of the
property. In determining the intended use of each property,
management considers various factors in making this judgement such
as whether the asset is held for social benefit at below a market
rent for the wider benefit of the community and whether the
properties are subsidised and operated at a loss in order to
continue providing a service. The accounting treatment will be
different depending upon the categorisation.
Loan issue costs
Where loan issues costs are deemed to be immaterial, they will
be amortised on an accruals basis instead of applying an effective
rate of interest basis.
Classification of financial instruments between basic and
other
Financial instruments are classified as either basic or other,
with differing accounting treatments depending on the
classification. Section 11 of FRS 102, 'Basic Financial
Instruments', sets out the requirements for the recognition,
measurement and de-recognition of basic financial instruments and
the conditions that must be satisfied in order to classify a
financial instrument as basic and therefore account for it in
accordance with Section 11.
Modification of financial liabilities
Where the Group has modified a loan agreement, an assessment is
carried out as to whether the modification results in substantially
different terms. If it does, the loan is de-recognised, and a new
financial liability recognised. If the new terms are not considered
substantially different, there is a re-measurement of the financial
liability using the original effective interest rate. In making
this assessment, judgement is applied in considering a combination
of quantitative and qualitative factors.
Capitalisation of property development costs
The Group capitalises development expenditure in accordance with
the accounting policy on housing properties. Judgement is exercised
over the likelihood that projects will continue.
Mixed tenure developments
Where the Group develops mixed tenure development schemes
including more than one element, the costs incurred in acquiring
and developing the land are attributed to each element of the
scheme depending on the intended usage to reflect the different
tenure types.
Estimation uncertainty
The Group makes estimates and assumptions concerning the future.
The resulting accounting estimates will, by definition, seldom
equal the related actual results. The estimates and assumptions
that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial year are addressed below.
Fair value measurement
Management uses valuation techniques to determine the fair value
of assets. This involves developing estimates and assumptions
consistent with how market participants would price the instrument.
Management base the assumptions on observable data as far as
possible but this is not always available. In that case, management
uses the best information available. Estimated fair values may vary
from the actual process that would be achievable in an arm's length
transaction at the reporting date.
Provisions
Provisions are only recognised where the Group has an obligation
to incur future expenditure as a result of a past event. The
provision is recognised as a liability in the Statement of
Financial Position. These would include Service Charge Sinking
Funds, provision for an outstanding insurance claim.
Valuation of investment properties
The Group carries its investment property at fair value and
engages independent valuers to determine fair value using a
valuation technique based on a discounted cash flow model. The
calculated fair value of the investment property therefore uses
assumptions, of which the most sensitive relate to the estimated
yield and the long-term vacancy rate.
The future economic environment is uncertain due to the pandemic
and although the full impact and long-term implications are yet to
be fully understood, the Group has confidence in the values
disclosed in the financial statements. The Group has undertaken
internal reviews of the most recent investment property valuations
and assessed the financial performance of the portfolio and are
confident that when taking into consideration the financial
strength of the Group, any potential downturn in the value or
financial returns from its investment properties would not have an
impact on the Group's long term financial viability.
Defined benefit pension scheme
The Group has obligations to pay pension benefits to certain
employees. The cost of these benefits and the present value of the
obligation depend on a number of factors, including life
expectancy, salary increases and the discount rate on corporate
bonds. Management estimates these factors in determining the net
pension obligation in the Statement of Financial Position. The
assumptions reflect historical experience and current trends.
Variations in these assumptions could significantly impact the
liability.
The cost of the LGPS and SHPS defined benefit pension plans are
primarily determined using actuarial valuations. The actuarial
valuation involves making assumptions about discount rates, future
salary increases, mortality rates and future pension increases. Due
to the complexity of the valuation, the underlying assumptions and
the long-term nature of these plans, such estimates are subject to
significant uncertainty. In determining the appropriate discount
rate, the scheme employers consider the interest rates of corporate
bonds in the respective currency with at least AA rating, with
extrapolated maturities corresponding to the expected duration of
the defined benefit obligation. The mortality rate is based on
publicly available mortality tables for the specific sector. Future
salary increases and pension increases are based on expected future
inflation rates for the respective sector.
The future salary increases provided by the actuaries ranged
between 3.35% and 3.87%. These are far in excess of our business
plan assumptions, which are 1.5% to March 2023, 1.9% to March 2024
and 2.0% for the remainder of the plan. We have reduced the actuary
forecasts by 0.35% to 0.87% to better reflect our business model
but have retained an element of prudence within the
calculation.
The future CPI assumptions (basis for pension increases)
provided by the actuaries ranged between 2.85% and 2.87%.and
discount rates ranged between 2% and 2.2%. Both of these are also
in excess of long-term inflation assumptions in the business plan
and consequently we have reduced the actuary forecasts to a CPI
assumption of 2.6% (long term CPI assumption in the business plan
is 2%) and increased the discount rate of 2.3%.
The impact of the changes to the applied assumptions detailed
above is to reduce the pension liability from GBP23.8m to GBP14.7m,
reducing the actuarial loss for the year from GBP9.8m to GBP0.7m.
Further details are given in note 19.
Inventory
Inventory includes properties for sale under market sale and
shared ownership programmes. In addition, the Group holds work in
progress on schemes where properties are being developed for sale.
The value of each asset is assessed for impairment by review
against its selling price less costs to complete and sell and each
scheme in progress against expected proceeds less costs to be
incurred.
Whilst the long-term economic environment is uncertain due to
the pandemic, the Group's immediate exposure to a downturn in the
property market is fairly limited as its market sales and shared
ownership programmes over the next 12 months are on a relatively
small scale. In a situation where there was a significant shock to
the market, the Group would consider short term conversion to
rented products for which there is a strong demand in the areas the
Group operates in.
The Group effectively monitors sales risk by monitoring the
market and stress testing the business plan including scenarios of
a 25% reduction in house prices, no sales in the next year, a
six-month delay to development and an increase in build costs. The
Group is able to withstand all these scenarios and can ensure that
suitable mitigation strategies are in place to protect its
long-term financial viability.
Components of housing properties and useful lives
Major components of housing properties have significantly
different patterns of consumption of economic benefits and
estimates are made to allocate the initial cost of the property to
its major components and to depreciate each component separately
over its useful economic life. The Group considers whether there
are any indications that the useful lives require revision at each
reporting date to ensure that they remain appropriate.
3a Particulars of turnover, cost of sales, operating costs and
operating surplus - Group and Association
2021
---------- ------------------- ----------
Cost of Operating Operating
Turnover sales costs Surplus*
GBP'000 GBP'000 GBP'000 GBP'000
Social housing lettings (note 3b) 63,023 - (45,355) 17,668
Other social housing activities
* First tranche property sales 4,873 (3,687) - 1,186
* Leasehold properties 83 - - 83
- Development - - (40) (40)
* Community services - - (854) (854)
* Other assistive technology 1,142 - (550) 592
Non social housing activities
* Garages 1,124 - (75) 1,049
* Market rent accommodation 947 - (133) 814
* Solar panel feed-in tariff 820 - (151) 669
* Other 210 - - 210
* Management services 305 - (156) 149
* Impairment losses - - (716) (716)
* One off costs - - (344) (344)
Total Association 72,527 (3,687) (48,374) 20,466
Open Market Property Sales 2,416 (2,134) - 282
Total Group 74,943 (5,821) (48,374) 20,748
2020
---------- -------- --------- ----------
Cost of Operating Operating
Turnover sales costs Surplus*
GBP'000 GBP'000 GBP'000 GBP'000
Social housing lettings (note 3b) 61,315 - (43,592) 17,723
Other social housing activities
* First tranche property sales 3,630 (2,707) - 923
* Leasehold properties 70 - - 70
- Development - - (76) (76)
* Community services - - (1,025) (1,025)
* Other assistive technology 835 - (305) 530
Non social housing activities
* Garages 1,138 - (109) 1,029
* Market rent accommodation 887 - (135) 752
* Solar panel feed-in tariff 836 - (144) 692
* Other 296 - - 296
* Management services 438 - (145) 293
* One off costs - - (411) (411)
Total Association 69,445 (2,707) (45,942) 20,796
Open Market Property Sales 1,721 (1,458) - 263
Total Group 71,166 (4,165) (45,942) 21,059
* operating surplus excluding gain/loss on disposal of housing
properties, plant and equipment
3b Particulars of income and expenditure from social housing lettings
Rented
Group and Association social Supported
Year ended 31 March 2021 housing Shared ownership housing Total 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income
Rents receivable 46,112 2,947 11,395 60,454 58,746
Supporting People - - 281 281 336
Service charge income 292 149 1,538 1,979 2,050
Amortised government grant 154 84 71 309 183
---------- ---------- ---------- ---------- ----------
Turnover from social housing
lettings 46,558 3,180 13,285 63,023 61,315
---------- ---------- ---------- ---------- ----------
Expenditure
Management (6,829) (701) (2,539) (10,069) (9,570)
Service charge costs (426) (171) (1,764) (2,361) (2,165)
Routine maintenance (9,209) - (2,603) (11,812) (11,281)
Planned maintenance (1,857) - (780) (2,637) (2,653)
Major repairs expenditure (5,553) - (1,213) (6,766) (6,422)
Write out components (359) - (126) (485) (497)
Bad debts (271) - (101) (372) (455)
Depreciation of housing
properties (7,686) (396) (1,891) (9,973) (9,547)
Depreciation - other (404) (41) (150) (595) (491)
Amortised intangible assets (153) (15) (57) (225) (159)
Pension (41) (4) (15) (60) (352)
---------- ---------- ---------- ---------- ----------
Operating costs (32,788) (1,328) (11,239) (45,355) (43,592)
---------- ---------- ---------- ---------- ----------
Operating surplus social
housing lettings 13,770 1,852 2,046 17,668 17,723
Void losses 533 2 91 626 411
4. Surplus on disposal of property, plant and equipment
Group and Association 2021 2020
GBP'000 GBP'000
Sale of property 3,746 5,797
Sales proceeds from the sale
of land 89 37
Costs of sale (1,961) (2,303)
Loss from other fixed asset
disposals (110) (76)
Surplus on disposal 1,764 3,455
5. Finance income
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Bank interest receivable 251 405 251 404
Interest receivable from a group
member - - 353 342
251 405 604 746
6. Interest and financing costs
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Interest payable on loans and overdrafts (15,195) (15,061) (9,670) (9,742)
Interest payable to group member - - (5,525) (5,319)
Net interest on defined benefit
liability (note 19) (309) (366) (309) (366)
Borrowing costs capitalised 1,191 974 1,191 974
(14,313) (14,453) (14,313) (14,453)
Borrowing costs on properties during construction have been
capitalised based on a capitalisation rate of 4.90% (2020:
4.95%).
7. Surplus on ordinary activities before taxation
Surplus on ordinary activities before taxation is stated after
charging:
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Depreciation of housing properties 9,973 9,547 9,973 9,547
Depreciation of other property, plant
& equipment 591 491 591 491
Amortised government grants (257) (183) (257) (183)
Amortised intangible assets 226 159 226 159
Auditor fees - statutory 54 57 36 39
Auditors fees - other services 17 - 17 -
Internal audit fees 79 55 79 55
Operating lease rentals - hire
of motor vehicles 361 224 361 224
(Surplus) on disposal of fixed
assets (1,764) (3,455) (1,764) (3,455)
8. Staff costs
Group Association
2021 2020 2021 2020
GBP'000 GBP'000
Wages and salaries 11,916 10,489 11,916 10,489
Social security costs 1,246 1,119 1,246 1,119
Other pension costs (see note 19) 1,881 2,207 1,881 2,207
15,043 13,815 15,043 13,815
The full-time equivalent number of staff who received
emoluments, excluding pension contribution, in excess of GBP60,000
are as shown below.
Group Association
2021 2020 2021 2020
number number
Salary Band GBP
60,000 - 69,999 4 2 4 2
70,000 - 79,999 - - - -
80,000 - 89,999 7 7 7 7
120,000 - 129,999 - - - -
130,000 - 139,999 1 1 1 1
140,000 - 149,999 1 1 1 1
150,000 - 159,999 - - - -
160,000 - 169,999 - 1 - 1
170,000 - 179,999 1 - 1 -
The average full-time equivalent
number of employees was: Group Association
2021 2020 2021 2020
number number
337 309 337 309
The basis of the calculation of the full-time equivalents was
the total number of working hours per week from all employees at
the reporting date, divided by a standard working week.
9. Board and Executive Directors' remuneration
Directors are defined as Board Members and the Executive
Management Team, who are key management personnel. Board members
are remunerated at different levels dependent upon their role.
Board members are also reimbursed for travel expenses totalling
GBP1.0k (2020: GBP7.4k)
Non-Executive GBP'000 Grand Development Governance Audit Grand Grand GUHG Homes
Board Member Union up to & &Risk Union Union Development &
Housing 1/10/2020 Remuneration Group Homes Company Services
Group then from 1 Funding Ltd Ltd Customer
disbanded /10/2020ce PLC Experience
& Committee
Remuneration from
from 1/10/2020
Gillian 8.5 ü ü
Walton
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Kami Nuttall 8.5 ü ü ü
(resigned
G & R October
2020)
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
James 15.0 ü ü ü
Macmillan
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Richard 8.5 ü ü ü ü
Broomfield
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Peter Fielder 8.5 ü ü ü
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Nicola Ewen 6.0 ü ü ü
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
John Edwards 8.5 ü ü ü ü
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Brent 6.0 ü ü
O'Halloran
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Vanessa 6.0 ü ü ü
Connolly
(appointed
G & R October
2020)
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
David Willis 6.0 ü ü ü ü
(appointed
Co-optee
to Board
June 2020
and
re-appointed
on May 2021)
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Emma Killick 4.8 ü
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Michael 6.0 ü ü
Pattinson
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Ian Bovingdon 6.0 ü ü
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Raj Shah 6.0 ü ü
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Kevin Gould 6.0 ü
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Ashleigh 2.0 ü
Webber
(appointed
September
2020)
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
Shawna Barnes 2.0 ü
(appointed
September
2020)
-------- -------- ------------ ------------- ------- -------- ------- ------------ -----------
The Executive Management team are ordinary members of either the
defined benefits or defined contribution pension schemes and have
no enhancements or special terms. No further contributions are made
to an individual pension arrangement for the Directors.
Total Directors' remuneration Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Wages and salaries 459 444 459 444
Social security costs 60 58 60 58
Pension payments 69 63 69 63
588 565 588 565
------- ------- ------- -------
Remuneration of the highest paid director
(excluding pension contributions)
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Group Chief Executive 171 166 171 166
The Chief Executive is a preserved member of the local authority
pension schemes run by Bedfordshire County Council (BCC). No
special or enhanced terms apply to her membership of the
scheme.
10. Taxation
The Group has charitable status for tax purposes and no
liability to Corporation Tax arises on its charitable activities.
In 2020/21 financial year, the Group paid no tax (2019/20: GBPnil)
relating to its non-charitable activities.
In the opinion of the directors, the tax payable by the Group is
not material and therefore full disclosures have not been provided
for.
11. Tangible fixed assets - Housing Properties
Group and Association
Land and
housing Shared
properties ownership
Housing under Leasehold Shared under
properties construction properties ownership construction Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 April 2020 602,865 15,241 5,744 61,962 7,667 693,479
Additions - 28,057 - - 9,564 37,621
Transfer to investment
property - (6,499) - - - (6,499)
Schemes completed 9,423 (9,423) - 3,000 (3,000) -
Improvements 5,612 - 1 - - 5,613
Disposals (1,949) - (138) (862) - (2,949)
At 31 March 2021 615,951 27,376 5,607 64,100 14,231 727,265
Depreciation
At 1 April 2020 (80,668) - (683) (2,169) - (83,520)
Charge for the
year (9,314) - (263) (396) - (9,973)
Transfer to investment
property - - - - - -
Disposals 240 - 138 38 - 416
At 31 March 2021 (89,742) - (808) (2,527) - (93,077)
Net book value
At 31 March 2021 526,209 27,376 4,799 61,573 14,231 634,188
At 31 March 2020 522,197 15,241 5,061 59,793 7,667 609,959
The brought forward balances include reclassifications between
housing properties and leasehold properties, the total net book
value for tangible fixed assets (Housing properties) remains
unchanged.
Freehold land and buildings with an Existing Use Value-Social
Housing of GBP450.8 million (2020: GBP434.8 million) have been
pledged to secure borrowings of the Group, which is surplus to the
covenant requirement. The Group is not allowed to pledge these
assets as security for other borrowings or to sell them to another
entity.
2021 2020
Analysis of works to existing properties GBP'000 GBP'000
Capitalised: replacement of components 4,068 4,915
Capitalised: improvements 1,545 1,896
Charged to Statement of Comprehensive
Income 6,766 6,422
12a. Property, plant and equipment - Other
Group and Association
L/Hold
Freehold Improve-ments Fixtures Computer Assistive
offices GBP'000 and fittings Vehicles equipment tech Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 April 2020 3,082 1,849 485 392 1,194 46 7,048
Additions - 9 6 - 86 12 113
Disposals (3,082) (142) (291) (41) - - (3,556)
At 31 March
2021 - 1,716 200 351 1,280 58 3,605
Depreciation
At 1 April 2020 (955) (118) (278) (378) (452) (11) (2,192)
Charge during
year - (191) (46) (14) (330) (10) (591)
Disposals 955 55 263 41 - - 1,314
At 31 March
2021 - (254) (61) (351) (782) (21) (1,469)
Net book value
At 31 March
2021 - 1,462 139 - 498 37 2,136
At 31 March
2020 2,127 1,731 207 14 742 35 4,856
The brought forward balances include reclassifications between
computer equipment and intangible assets (IT software) included at
note 12b. The reclassified assets were fully depreciation resulting
in no change in brought forward total net book values.
12b. Intangible Assets
Group and Association
IT Software
GBP'000
Cost
At 1 April 2020 1,910
Additions 369
At 31 March 2021 2,279
Amortisation
At 1 April 2020 (1,596)
Charge for the
year (226)
At 31 March 2021 (1,822)
Net book value
At 31 March 2021 457
At 31 March 2020 314
13. Investment properties
Group and Association
2021 2020
GBP'000 GBP'000
Valuation
At 1 April 17,896 16,500
Transfer from housing properties - -
Additions 6,499 1,396
Fair value loss (895) -
Carrying value at 31 March 23,500 17,896
Investment properties were valued by Avison Young at fair value
at 31 March 2021. These are independent valuers with recent
experience in the location and class of the investment property
being valued. The method of determining fair value was in
accordance with the RICS Valuation - Global Standards (effective
from 31 January 2020) and significant assumptions were as
follows:
a) that the properties are in a good condition and well managed
and maintained to institutionally acceptable standards
b) that the properties comply with legal or statutory consents.
There are no restrictions on the realisation of investment
property.
c) that the valuation was based on the accommodation being tenanted.
14. Fixed asset investments
Association
2021 2020
GBP'000 GBP'000
At 1 April 50 50
At 31 March 50 50
Grand Union Housing Group is incorporated in England under the
Co-operative and Community Benefit Society Act 2014 and is required
by statute to prepare Group financial statements.
All shares held as investments are held as ordinary shares.
Grand Union Housing Group Limited is the ultimate controlling party
of:
Holding
Subsidiary Undertakings Principal activity %
Grand Union Group Funding Plc Access funding 100
Grand Union Homes Limited Market sales of properties 100
GUHG Development Company Limited Design and build activities 100
15. Stock
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Properties in construction 13,823 7,307 6,761 3,459
Completed properties 1,654 4,521 1,654 2,474
Consumable stock 207 235 207 235
15,684 12,063 8,622 6,168
An amount of interest of GBP804k (2020: GBP1,007k) is included
in work in progress and the number of inventories recognised as an
expense in the year was GBP5,821k (2020: GBP4,164k).
16. Debtors
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Amounts falling due within one
year
Rent arrears 3,071 2,774 3,071 2,774
Provision for bad debts (1,782) (1,592) (1,782) (1,592)
Cash due from collecting agencies 228 208 228 208
1,517 1,390 1,517 1,390
Other debtors 487 737 487 737
Amounts owed by Group undertakings - - - -
Prepayments and accrued income 1,068 1,278 1,069 1,278
3,072 3,405 3,073 3,405
Bedford Citizens Housing Association 4,240 4,345 4,240 4,345
Amounts owed by Group undertakings - - 7,598 6,314
4,240 4,345 11,838 10,659
Total debtors 7,312 7,750 14,911 14,064
-
======== ======== ======== ========
No disclosure has been made of the net present value of rental
arrears subject to repayment plans as the amount is considered to
be insignificant.
The Group has a long-term loan owing from Bedford Citizens
Housing Association for the provision of an older persons' scheme
to support the delivery of housing for vulnerable residents in the
Bedford area.
The amounts owed by the group members are unsecured, interest
free, have no fixed date of repayments and are repayable on
demand.
17. Creditors - amounts falling due within one year
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Rents received in advance 2,367 2,335 2,367 2,335
Housing loans 8,890 3,085 8,890 3,085
Amounts owed to group members - - 2,042 38
Other creditors 1,935 1,712 1,935 1,712
Government grants - received in
advance 257 183 257 183
Recycled capital grant fund 171 103 171 103
Accruals and deferred income 9,009 8,600 7,005 8,517
22,629 16,018 22,667 15,974
The amounts owed to group members are unsecured, interest free,
have no fixed date of repayments and are repayable on demand.
18. Cre ditors - amounts falling due after more than one year
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Housing loans 159,228 181,326 159,228 181,326
Bond (due to Group undertakings) 144,616 113,337 144,616 113,337
Government grants 24,692 17,612 24,692 17,612
Recycled capital grant fund 360 647 360 647
Voluntary Right to Buy - - - -
328,896 312,922 328,896 312,922
Housing loans
At 31 March 2021, GBP315.6 million (of the total facility of
GBP404.8 million) had been drawn down, of which GBP290.6 million
was fixed at interest rates between 3.08% and 7.13%. GBP25 million
was at variable rates. These housing loans are secured by a fixed
charge on a proportion of the assets of the Group.
Housing loans are repayable as follows:
2021 2020
Bank loans GBP'000 GBP'000
Between one and two years 2,085 9,083
Between two and five years 16,583 36,325
After five years 143,223 137,192
On demand or within one year 9,083 3,204
170,974 185,804
Bond
On 4 December 2013, Grand Union Group Funding Plc successfully
issued a GBP115m bond at a coupon of 4.625% with repayment after 30
years in 2043. The bond was issued at a discount of 0.578% so that
funds of GBP114.3m were received.
The cost of issuing the bond was GBP1.4m leaving a net balance
of GBP112.9m. This was on-lent to Grand Union Housing Group Limited
to enable the repayment of some of its existing loans and to fund
future development. The effective interest rate and actual interest
rate associated with the listed bond and on-lent funds is 4.715%
and 4.625% respectively. The underlying assets of the issuance
belong to Grand Union Housing Group Limited through a security
trust arrangement with the Prudential Trustee Company Ltd.
On 15 December 2020, Grand Union Group Funding Plc successfully
tapped the 2043 Bond for a further GBP56m, which included a
retained element of GBP35m. The Bonds were issued at a premium of
44.22%, so funds received totalled GBP30.3m, this was on-lent to
Grand Union Housing Group Limited to fund future development. The
effective interest rate, and actual interest rate, associated with
the 2020 bond tap and on-lent funds is 2.182% and 4.625%
respectively.
Any bond discount/premium and costs of issue are amortised over
the term of the bond, 30 years, with Grand Union Housing Group
Limited being liable to Grand Union Group Funding Plc for both.
Government grants - deferred income
2021 2020
GBP'000 GBP'000
Original capital grant value
At 1 April 18,327 8,552
Grants receivable 7,411 9,775
------------ ------------
At 31 March 25,738 18,327
Amortisation
At 1 April (532) (332)
Amortisation to Statement of Comprehensive
Income (257) (183)
To recycled capital grant - (17)
------------ ------------
At 31 March (789) (532)
------------ ------------
At 31 March 24,949 17,795
Due within one year (note 17) 257 183
Due after one year (note 18) 24,692 17,612
Capital grants received are recorded as deferred income and
amortised to turnover within the Statement of Comprehensive Income.
The period of amortisation is the remaining years of useful
economic life for the building structure from its date of
construction, or at the time of its acquisition, if this is
later.
Recycled capital grant
2021 2020
GBP'000 GBP'000
Opening balance 750 625
Grant recycled 115 125
Interest accrued - -
New build (grant utilised) (334) -
------------ ------------
Carried forward 531 750
Grants to be recycled less than one
year (note 17) (171) (103)
------------ ------------
At end of the year 360 647
19 Retirement benefit schemes
Since April 2013, Grand Union Housing Group has offered to all
new employees a defined contribution pension scheme, the Grand
Union Housing Aviva Pension Plan. During 2020/21 the Group paid
GBP530,162 (2020: GBP413,934) on behalf of employees who have
joined the scheme. GBP1,207 (2020: GBP57,923) was outstanding as at
31 March 2021.
The Group participates in two pension schemes as an "Admitted
Body", the local authority pension schemes run by Bedfordshire
(BCC) and Northamptonshire (NCC) County Councils. These schemes
provide benefits based on final pensionable pay for employees of
all participating organisations. Both pension schemes are
multi-employer defined benefit schemes and are funded and
contracted out of the state scheme. Contributions are determined by
a qualified actuary (Hymans Robertson) on the basis of triennial
valuations using the "projected unit credit" method.
The latest available valuations were as at 31 March 2019 and
these showed the overall actuarial value of the scheme's assets at
that date of GBP46,571k (market value). The actuarial value was
sufficient to cover 88% of the benefits that had accrued to members
and past members of the pension schemes.
Northamptonshire Bedfordshire
scheme scheme
valuation at valuation at
------------------ --------------
2021 2020 2021 2020
Key assumptions used:
Discount rate 2.30 2.30 2.30 2.35
Future pension increases 2.60 1.90 2.60 1.70
Mortality assumptions:
Investigations have been carried out within the past three years
into the mortality experience of the Group's defined benefit
schemes. These investigations concluded that the current mortality
assumptions include sufficient allowance for future improvements in
mortality rates. The assumed life expectations on retirement at age
65 are:
Northamptonshire Bedfordshire
Scheme Scheme
Valuation at Valuation at
------------------ ---------------------
2021 2020 2021 2020
Retiring today:
Men 21.7 21.5 21.9 22.2
Women 24.1 23.7 24.3 24.3
Retiring in 20 years:
Men 22.8 22.3 22.8 23.4
Women 25.8 25.1 26.0 26.1
Amounts recognised in the Statement of Comprehensive Income in
respect of these defined benefit schemes are as follows:
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Current service cost 1,381 1,709 1,381 1,709
Net interest cost 305 356 305 356
Recognised in other comprehensive
income 532 (2,711) 532 (2,711)
Total cost relating to defined
benefit scheme 2,218 (646) 2,218 (646)
The amount included in the Statement of Financial Position
arising from the Group's obligations in respect of its defined
benefit retirement benefit schemes is as follows:
2021 2020
GBP'000 GBP'000
Present value of defined benefit obligations 69,139 57,959
Fair value of scheme assets (54,809) (44,574)
Net liability recognised in the Statement
of Financial Position 14,330 13,385
Movements in the present value of defined benefit obligations
were as follows:
2021 2020
GBP'000 GBP'000
At 1 April 57,959 64,456
Service cost 1,355 1,680
Interest cost 1,345 1,542
Actuarial gains and losses 9,600 (8,983)
Contributions from scheme participants 301 301
Benefits paid (1,407) (1,325)
Past Service costs - 302
Unfunded benefits paid (14) (14)
At 31 March 69,139 57,959
Movements in the fair value of scheme assets were as
follows:
2021 2020
GBP'000 GBP'000
At 1 April 44,574 49,088
Actuarial gains and losses 9,068 (6,272)
Return on plan assets
(excluding amounts included in
net interest cost) 1,040 1,186
Contributions from the employer 1,273 1,639
Administration expenses (26) (29)
Contributions from scheme participants 301 301
Benefits paid (1,421) (1,339)
At 31 March 54,809 44,574
The analysis of the scheme assets at the Statement of Financial
Position date was as follows:
Fair value of
assets
------------------
2021 2020
GBP'000 GBP'000
Equity instruments 37,379 29,965
Debt instruments 10,414 7,750
Property 5,591 5,421
Cash 1,425 1,438
54,809 44,574
The Pension Schemes have not invested in any of the Group's own
financial instruments or assets.
Social Housing Pension Scheme (SHPS)
The company participates in the Social Housing Pension Scheme
(the Scheme), a multi-employer scheme which provides benefits to
some 500 non-associated employers. The Scheme is a defined benefit
scheme in the UK.
The Scheme is subject to the funding legislation outlined in the
Pensions Act 2004 which came into force on 30 December 2005. This,
together with documents issued by the Pensions Regulator and
Technical Actuarial Standards issued by the Financial Reporting
Council, set out the framework for funding defined benefit
occupational pension schemes in the UK.
The last triennial valuation of the scheme for funding purposes
was carried out as at 30 September 2020 and the results of this
valuation are in the process of being finalised. The last published
valuation in 2017 revealed a deficit of GBP1,522m. A recovery plan
has been put in place with the aim of removing this deficit by 30
September 2026.
The Scheme is classified as a 'last-man standing arrangement'.
Therefore, the company is potentially liable for other
participating employers' obligations if those employers are unable
to meet their share of the scheme deficit following withdrawal from
the Scheme. Participating employers are legally required to meet
their share of the Scheme deficit on an annuity purchase basis on
withdrawal from the Scheme.
2021 2020
---- ----
Key assumptions used:
Discount rate 2.30 2.36
Future pension increases 2.60 1.58
Mortality assumptions:
Investigations have been carried out within the past three years
into the mortality experience of the Group's defined benefit
schemes. These investigations concluded that the current mortality
assumptions include sufficient allowance for future improvements in
mortality rates.
The assumed life expectations on retirement at age 65 are:
2021 2020
---- ----
Retiring today:
Men 21.6 21.5
Women 23.5 23.3
Retiring in 20 years:
Men 22.9 22.9
Women 25.1 24.5
Amounts recognised in the Statement of Comprehensive Income in
respect of these defined benefit schemes are as follows:
Group
2021 Association2020
GBP'000 GBP'000
Current service cost 47 55
Net interest cost 4 10
Recognised in other comprehensive
income 203 (243)
Total cost relating to defined
benefit scheme 254 (178)
The amount included in the Statement of Financial Position
arising from the Group's obligations in respect of its defined
benefit retirement benefit schemes is as follows:
2021 2020
GBP'000 GBP'000
2109
Present value of defined benefit obligations 2,225 1,768
Fair value of scheme assets (1,872) (1,574)
Net liability recognised in the Statement of
Financial Position 353 194
Movements in the present value of defined benefit obligations
were as follows:
2021 2020
GBP'000 GBP'000
At 1 April 1,768 1,858
Service cost 47 55
Interest cost 42 44
Actuarial gains and losses 377 (175)
Contributions from scheme participants 20 14
Benefits paid (29) (28)
Unfunded benefits paid - -
At 31 March 2,225 1,768
Movements in the fair value of scheme assets were as
follows:
2021 2020
GBP'000 GBP'000
At 1 April 1,574 1,411
Actuarial gains and losses 174 68
Return on plan assets
(excluding amounts included in
net interest cost) 38 34
Contributions from the employer 95 75
Contributions from scheme participants 20 14
Benefits paid (29) (28)
At 31 March 1,872 1,574
The analysis of the scheme assets at the Statement of Financial
Position date was as follows:
Fair Value Fair Value
of Assets of Assets
2021 2020
GBP'000 GBP'000
Equity instruments 314 264
Debt instruments 1,386 1,165
Property 168 142
Cash 4 3
1,872 1,574
The Pension Schemes have not invested in any of the Group's own
financial instruments or assets.
20. Share capital - Association
2021 2020
GBP GBP
At beginning of year 10 10
Issued during the year - 1
Cancelled during the year - (1)
At end of year 10 10
The share capital of the Association consists of shares with a
nominal value of GBP1 each, which carry no rights to dividends or
other income. Shares in issue are not capable of being repaid or
transferred. When the shareholder ceases to be a member that
person's share is cancelled, and the amount paid up thereon becomes
the property of the Association.
No shareholders have any rights in the residual interest in the
assets of the Association after deducting all liabilities.
21. Statement of cash flows
Group
2021 2020
GBP'000 GBP'000
Cash flow from operating activities
Operating surplus for the year 22,512 24,514
Adjustment for non-cash items:
Depreciation of property, plant and equipment 10,793 10,464
Increase/(Decrease) in debtors 438 (492)
Increase in stock (3,621) (4,573)
Increase in creditors (1,276) (576)
Pension costs less contributions payable 369 718
Adjustment for investing or financing activities:
Less Gain on disposal of tangible fixed
assets (1,764) (3,455)
Cash generated by operations 27,451 26,600
22. Financial commitments
Capital commitments are as follows:
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Contracted for but not provided
for 60,285 56,718 59,398 53,226
Approved by the directors but not
contracted for 12,280 - 12,280 -
72,565 56,718 71,678 53,226
The total amount contracted for at 31 March 2021 in respect of
new dwellings relates to approved schemes for which grant approval
has been received and is covered by cash balances and undrawn
revolving credit facilities.
23. Analysis of changes in net debt
Group
At Start Non-Cash At Year
of Year Cash Flows movements end
GBP'000 GBP'000 GBP'000 GBP'000
Cash and cash equivalents 18,185 70 - 18,255
Housing loans due in one year (3,204) (5,879) - (9,083)
Housing loans due after one year (295,938) (10,570) - (306,508)
(280,957) (16,379) - (297,336)
Association
At Start Non-Cash At Year
of Year Cash Flows movements end
GBP'000 GBP'000 GBP'000 GBP'000
Cash and cash equivalents 18,078 106 - 18,184
Housing loans due in one year (3,204) (5,879) - (9,083)
Housing loans due after one year (295,938) (10,570) - (306,508)
(281,064) (16,343) - (297,407)
24. Operating lease commitments
Total future minimum lease payments under non-cancellable
operating leases are as follows:
Group Association
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Payments due:
* within one year 893 741 893 741
* between one and five years 3,560 3,253 3,560 3,253
* In five years or more 1,758 2,322 1,758 2,322
6,211 6,316 6,211 6,316
25. Number of units in management
At the end of the year accommodation owned and / or managed for
each class of accommodation was as follows:
Group and Association 2021 2020
units units
Owned and managed *restated
General needs 7,919 7,912
Supported housing and housing for older people 2,972 2,948
Shared ownership accommodation 821 803
Market rent 134 110
Intermediate market rent 73 73
Housing accommodation owned at the end of year 11,919 11,846
Managed not owned
General needs 42 42
Supported housing and housing for older people 184 189
Shared ownership accommodation 43 44
Market rent 7 7
Intermediate market rent 54 54
12,249 12,182
------- ------------
*restated due to late re-classification
Reconciliation of residential accommodation owned and/or
managed
2020 Additions* Disposals Other 2021
No No No No No
General Needs 7,954 54 (15) (32) 7,961
Supported housing and housing
for older people 3,137 16 (24) 27 3,156
Shared Ownership accommodation 847 25 (7) (1) 864
Market rent 117 24 - - 141
Intermediate market rent 127 - - - 127
12,182 119 (46) (6) 12,249
-------- ---------- --------- ----- ------
* includes 111 new build units and additional units from
remodelling or purchase of completed units.
26. Related party transactions
There were no Customer or Leaseholder Members of the Group Board
as at 31 March 2021.
There were no Board members nominated by local authorities.
Grand Union Housing Group and its subsidiaries have throughout
the year held balances with each other these balances relate to
normal trading transactions between each of the entities and are
covered in more detail below:
2021 2020
GBP'000 GBP'000
Payments made to subsidiaries
Grand Union Group Funding Plc - loan interest 5,525 5,319
Grand Union Homes Limited - development
cash flows 1,636 281
Receipts from subsidiaries
Grand Union Homes Limited - intercompany
loan interest 352 342
Amounts owed by subsidiaries at 31 March
Due within one year:
Grand Union Homes Limited - -
Due after more than one year:
Grand Union Homes Limited 7,598 6,314
Amounts owed to subsidiaries at 31 March
Due within one year:
Grand Union Group Funding Plc - unpaid
share capital 38 38
Due after more than one year:
Grand Union Group Funding Plc - Bond 136,000 115,000
There were no transactions made with GUHG Development Company
Limited during 2021 or 2020.
27. Ultimate Controlling Party
The ultimate controlling party of the Grand Union Housing Group
Limited is the Board of Grand Union Housing Group Limited. The
Annual Financial Statements of the Group and Association are
publicly available, and copies are available upon request from the
registered office and website.
Grand Union Housing Group is the ultimate controlling party
of:
-- Grand Union Homes Limited - a non-regulated private company,
registered in England and Wales, limited by shares set up to
undertake sales of homes on the open market for the Group.
-- GUHG Development Company Limited - a non-regulated private
company, limited by shares registered in England and Wales, set up
to provide design and build services on behalf of the Group. This
company did not trade during the year.
-- Grand Union Group Funding Plc - a non-regulated public
limited company, registered in England and Wales, formed to on-lend
all proceeds of a bond issue to members of the Group.
28. Financial instruments
The carrying values of the Group's financial assets and
liabilities are summarised by category below:
Group
2021 2020
GBP'000 GBP'000
Financial assets that are measured at amortised
cost
Debtors 1,556 2,016
Debtors falling due after one year 11,838 10,659
Cash 18,255 18,185
31,649 30,860
Financial liabilities that are measured at
amortised cost
Trade and other payables 6,257 4,043
Public bonds 144,616 113,337
Loans and borrowings 170,975 185,804
Accruals and deferred income 7,004 8,518
328,852 311,702
29. Legislative provisions
The Association is registered under the Co-operative and
Community Benefit Societies Act 2014 and is registered with the
Regulator of Social Housing as a Registered Provider as defined by
the Housing and Regeneration Act 2008.
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END
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