Housing maintenance report reveals poor standards and fraud-friendly culture

Published by Max Salsbury for 24dash.com in Housing and also in Communities, Finance

A report to the Northern Ireland Assembly on the state of the country's largest landlord's response maintenance contracts (RMCs) has revealed poor standards and a culture exposed to fraud.

The report identifies weaknesses in the Northern Ireland Housing Executive's (NIHE) assessment of RMCs that have left it exposed to "impropriety and fraud".

The NIHE is Northern Ireland's largest landlord and manages around 90,000 homes. It is also an executive non-departmental public body of the Department for Social Development and has an annual budget of £750m - £50m of which is spent on response maintenance.

The report cites examples of poor contractor performance which were not "robustly challenged", and of overpayments that were indentified but inadequately dealt with.

Comptroller and Auditor General Kieran Donnelly's report found that the NIHE spent more than £200m on response maintenance in the five years to 2011.

Mr Donnelly said: "My review found serious weaknesses in the management of the contracts governing this expenditure."

The report focuses on a contract the NIHE terminated with maintenance company Red Sky in 2011.

The Audit Office subsequently found that there had been a long history of problems with the company, whose contract was worth £7m a year. It was discovered that there were allegations in 2000 and 2005 of NIHE officers accepting excessive hospitality from Red Sky. It was also found that the company was overpaid by £264,000 in 2005 but that the NIHE decided not to take action because NIHE staff were partially at fault.

Mr Donnelly's report also reveals that the NIHE's reporting of suspected fraud is poor. Only two out of 22 on-going fraud investigations were reported to the Comptroller and Auditor General in 2010-11.

The Audit Office also identified weaknesses in the NIHE's inspection system, which it found fails to give sufficient weight to on-site inspections, including standards or quality of work carried out by contractors. Consequently, districts with low scores for on-site inspection could, and did, get an overall satisfactory rating. When the Audit Office made adjustments for this it found that 21 out of the 35 Housing Executive District Offices achieved an unacceptable rating.

Mr Donnelly said: "I welcome the Housing Executive’s acceptance of the recommendations contained in my report and its introduction of wide ranging changes to deliver improvements.  These are essential if tenants are to receive a quality service and taxpayers are to receive value for money.”