Profile - Richard Ennis, kingpin of public sector finance

As the first Director of Finance and Corporate Services at the Homes and Communities Agency, Richard Ennis heads the engine room of the Government’s Housing and Regeneration specialist.

Richard is central to the smooth running of an agency with a significant role to play in keeping new house building going during the current downturn and is accountable for an £18.6bn budget. He brings 19 years of experience in Local Authority finance to his new role.

24housing magazine brings 24dash the full version of this month’s exclusive Profile interview…

You’ve been in post since April. What went through your mind when you accepted the role of Director of Finance and Corporate Services for a housing agency which has an annual investment budget of over £6bn?
There was that usual mix of exhilaration and trepidation that anyone gets when they hear they’ve got a job they really wanted. For me that equated to recognition of the huge opportunity I was being given to drive the finance and resources of a major national organisation, tinged with a genuine sadness at leaving behind a 19 year career in local government. As it’s turned out, the reality is I haven’t really left local government behind as the HCA is a national organisation that delivers locally, with councils, through our Single Conversation business process, being our key delivery partner. So my experience has been extremely useful.

What were your initial key challenges and goals?
Again, in general I suspect they were the same as anyone faces in a new role; a combination of learning about a new organisation and a subject area that hadn’t been a specialism for me in the past – councils clearly have a far-ranging remit that includes housing, but it’s difficult to be a specialist when you work in local authority corporate services – and needing to get on with doing the job you’ve been employed to do. My goal was to get that balance right, as quickly as possible.

With the former that meant getting to grips with a sizeable organisation, with a complex national remit; learning a whole new set of acronyms; and familiarising myself, after nearly 10 years in London Boroughs, with the 95% of the country which lies outside the Capital!

For the latter it’s easier to be specific. As a new organisation, bringing together the responsibilities, staff and systems of four very different predecessors, the whole Agency is undergoing a structuring process (I hesitate to say re-structuring because we’re new; this really is an exercise in getting it right first time, making ourselves fit for our local purpose) and as my position was the last Executive Team post to be filled, there was some ground to be made up in my directorate. That was a significant priority, to give the people who make up my team some certainty and security as quickly as possible, particularly because, as a whole, the Agency is moving around 100 corporate posts from the centre to strengthen regional delivery teams.

And then there was the need to get a clean audit and close the first ever set of HCA accounts. These have been prepared under what’s known as merger accounting rules, and basically means they assume the HCA had existed for two full years before 31st March 2009, as opposed to just four months as was the reality. That has been a big job, but we’ve got that clean audit (recognised as a significant achievement for a merged organisation in its first year of operation) and we’ve caught up with the rest of the Agency with our directorate’s structuring exercise. I really have to give huge credit to my team on both of these achievements and in particular for keeping a focus and building momentum for the first 8 months of the HCA when there was no director in post.

How have those challenges and goals evolved as the HCA continues to bed in?
I think they’ve grown in line with the Agency, for example as you get a structure established and processes bedded-in, expectations for delivery start to rise. That’s certainly true of the HCA as a whole. I think the sector understands the challenges we have faced, challenges in fact we’ve faced with them, but are appreciative of the action we’ve taken in meeting those challenges. We often speak of the simple act of writing to our investment partners in the first weeks of the HCA, to offer tailored packages of support and flexible grant rates, as being one of the most important things we’ve done. And it’s true – it set out our intent to work closely and sensibly with those we rely on for delivery; to recognise the difficult operating environment the downturn has created; and to take action to help mitigate against its effects.

That chimes well with my directorate’s work internally as I believe that culture is all about delivery. There’s a real desire to get new and affordable homes built in places people want and can afford to live, and Finance and Corporate Services is absolutely central to the Agency being able to achieve that. Our Corporate Strategy director (Trevor Beattie) likes to describe his directorate as the glue that binds the HCA together. It’s a good descriptor, and by the same token we are very much the engine that drives it. My goal then, is first to help keep the engine running and second to constantly fine tune its performance!

How closely do you deal with emerging issues and debates – such as the pressure on gap-funding for stock transfer HAs?
Personally I’m involved in issues and debates on a number of levels. Firstly as a Corporate director I’m part of the HCA’s executive management team. We meet weekly as a group and essentially make the significant operational decisions necessary, under the guidance of Bob Kerslake and our Board. Secondly, as Finance Director I’m ultimately responsible for the state of the Agency’s accounts, so while dealing with specific issues is devolved to specific delivery teams, I need to have a clear input. And thirdly, as Corporate Services Director, I head the backroom teams that help frontline staff make it happen. Again, its’ the same as any organisation, we all have our specific roles and responsibilities, but they all overlap Venn-diagram style, to make up the whole.

What is the most rewarding element of your role?
For me personally it’s always simply doing the best job you can do, using my leadership style, which is best described as high energy and enthusiastic! The real reward is seeing how that translates into the successful operation of the HCA, and that in turn means our eventual outputs and outcomes. Not just the actual sites we’ve completed and the thousands of people who have a quality home at a rent or mortgage level they can afford, but the outcomes too; how our combined programmes as a single unified agency have added value and made a difference to people’s lives. It’s important that we should capture that. Out of necessity we have targets because we have to demonstrate that we’re maximising value for every public pound we spend, but often the wider benefits are less tangible. As an Agency, we’ve just introduced an integrated performance framework which is designed to capture those intangibles and it will be a vital tool in us repeating and sharing what works and discarding what doesn’t.

What do you consider to be your greatest achievement in post so far?
On a practical level it’s building on the good work started by my team in establishing an effective structure and getting a clean set of accounts signed off. More conceptually, I think as a team we’ve established a clear ‘can-do’ delivery culture which means, to use a sporting metaphor, we can look each other in the eye and know we’ve done everything we can to help support our regional delivery teams.

The HCA is a year old this month. How do you feel the agency has performed so far?
Ultimately, I share my chief executive’s view that we would prefer the sector to say how we’ve performed, but from my perspective I think we’re probably much further ahead than we could have been given the challenges involved in creating one organisation from four and simultaneously keeping delivery going. Set that against the backdrop of the steepest and deepest economic downturn for generations and I think many might say it was a bad time to launch a new housing organisation! But as much as it’s been a challenging environment to begin operating in, it’s also provided an opportunity for us to quickly make a mark. Bottom line is we met our targets in 2008-09 for housing delivery, building nearly 50,000 new affordable homes and investing £3.9 billion through our NAHP. And this year and next nearly half of all homes to be built in England will be directly funded by the HCA. Despite the downturn we have maintained our Programme momentum and had a significant impact on the housing market, helping house builders and RSLs to maintain development activity. In particular we’ve invested £350m to bring 9,600 unsold developer homes into use as affordable housing, allocated £400m to HomeBuy Direct to help around 10,000 people into home ownership in a sustainable way; and committed £285m to help those struggling with mortgage repayments and who may be at risk of repossessions.

Since April we have moved quickly to allocate £1bn of Kickstart funding and £350m of Local Authority newbuild funding – allocated through the Budget and Housing Pledge and an indicator, we believe, of Government’s trust in the HCA – and launched the Public Land Initiative which will see the HCA and other public bodies invest land at a deferred value, to help developers and contractors with upfront costs. And there’s an employment dividend in all of our work, where we’re seeking to achieve around 2,800 apprenticeships and local labour initiatives as an added benefit of our public investment.

But, again, to move away from the hard outputs, I think the HCA is well established, for example, as one of the most important delivery partners of local government. We’re rolling our Single Conversation way of doing business out in over 100 places already. We call it the Single Conversation because it will be comprehensive its coverage, including the full range of housing, infrastructure, regeneration and community activities. These are topics which would previously have required discussion with a range of different agencies. The aim is to establish local investment plans and agreements to realise mutually shared ambitions for an area. In this way, we will act as the bridge between national targets and local priorities; and demonstrate our capacity to deliver locally.

It’s quite possible there will be a change of government in the coming months. How do you feel the HCA will fare under the Tory’s?
That’s something of a curve ball! At the HCA we’re quite clear that we could be facing a new government whichever party wins the next general election. And that government will quickly need to establish its priorities. Our focus will be the same – we’re a Government delivery agency, regardless of political hue, and as such we’re happy to be judged on that delivery. And of course, the underlying aims are likely to be the same. On the big picture points, it’s clear for example, that we need to build more homes in this country; we need to continue the rejuvenation of failing inner-city estates; and we will probably need to do it in the context of tightening public finances. The localism agenda will also continue and the HCA is well placed to work within that framework. In fact, it’s at the very heart of our ethos.

What will be the single biggest issue facing you personally – and the social housing sector generally – in 2010?
They’re probably one in the same: tightening public finances. The HCA has a significant budget this year and next – overall (£13.6bn) and specifically for affordable housing (£6.75bn) – and what we’re saying to our partners is look, there’s good money here so let’s really make the most of the opportunity.

But it’s also clear that we also need to look at new sources of funding and new ways of investing it. That’s why our Private Rental Sector Initiative and our Public Land Initiative, to give just two examples, are so crucial. Our PRSI could see new institutional investment at scale in the private rented housing for the first time in England and that in turn would mean a cash boost for housebuilders – providing another source of presales and removing some of the speculative nature of development – and greater choice and flexibility for consumers. Our PLI will see us and other public bodies invest their land in schemes for a deferred value, with a return to the taxpayer taken at a later date when the development is completed. It helps housebuilders with upfront development costs and allows us to maximise the use of our land today, going some way to negate the significant fall in land values.