Merthyr Valleys Homes proves there are progressive alternatives for renters

In July, 24 Housing magazine published its list of the top 50 landlords in the UK. There are over 4,000 housing associations in this country, but four out of the top five were mutuals – owned and run by tenants and employees.

Merthyr Valleys Homes, which I lead, topped the list as the number one housing association in the UK, and Rochdale Borough Wide Homes, which pioneered the mutual model, came fifth.

On the 1st May 2016 the tenants and employees of Merthyr Valleys Homes took control of this former stock transfer housing association. This was a game-changer in Wales as for the first time employees and tenants had the power to make all the big decision in a housing association.

Under the new rules, anyone over 16 living in one of the 4,300 homes can become a member and since May 2016, 1,000 have already joined. The idea has captured the imagination of the employees and 97 per cent of the 167 eligible employees have become members.

The move to bring Merthyr Valley Homes into mutual ownership is the product of more than a year of discussions and debates with tenants, employees, community organisations and councillors.

Merthyr Valley Homes is an anchor investor in Merthyr Tydfil and last year spent nearly £15 million in the borough through local employment and spending through small local contractors and social enterprises.

The creation of the housing co-operative reflects a changing consensus about the role of councils and central government in providing public services, particularly as budgets have fallen.

New models of delivery have emerged to reflect this shift, with housing stock transfers and charities running leisure providing as alternatives to rampant privatisation or outsourcing.

But in the governance models in this new and wider public sector, the staff and service users have too often lacked a voice. Housing has been one of the few exceptions, with many housing associations making impressive efforts to involve service users.

Some housing associations have gone even further, creating mutuals where tenants share or even control the power. But very few have found a legitimate way to combine the interests of service users and the interests of employees.

In Wales, there’s a growing determination to create a new Welsh way of doing business and delivering public services.

There’s an appetite – reflected in the Welsh Government’s recent ‘Is the Feeling Mutual?’ report – for a new business model which recognises the importance of employees in the dynamic of creating an excellent organisation that serves the public.

I believe that this new model of tenants and employees being members will break down the tired, outdated model of public services being ‘delivered’ to consumers, and the barriers created by the separate roles of landlord/tenant employee/employer.

This is a new coalition between those living in their houses, those working on their houses and local statutory and voluntary bodies supporting the community.

Merthyr Valley Homes wanted to bring the people whose futures where linked by the way the organisation worked into the heart of the structure:

The tenants who live in our properties

The staff who work for the organisation.

A member of staff recently retired after 38 years of service and we estimated that he had carried out over 50,000 responsive electrical repairs. They felt that a person who has given his whole working life to the tenants of Merthyr deserved to have a stake in the future and management of that organisation

These new shareholders will exercise considerable influence and will have the power to appoint and dismiss the Board of Directors; they will set the values and the budgets and will approve the accounts and audit report.

The organisation already has strong values on regeneration and employment. It has been a living wage employer since 2011 and has a valued trade union recognition agreement.

In the autumn of 2015 it received the UK supporting social enterprise award for the working in supporting social enterprise.

In designing the mutual, one of the important decisions was that every employee would be an equal member.

So Merthyr Valleys Homes does not operate any subsidiaries in which low paid and no pension employees are parked with second tier term and conditions. All employees can join the Local Government Pension Scheme along with other important employment benefits.

There will of course be tensions along the way between rents and salaries. But in 30 years of housing, I’ve never been to a meeting where tenants talk about wanting housing employees who provide their services to be outsourced and paid the minimum wage.

Equally I have never heard frontline employees, many of whom live in social housing themselves, calling for ‘market rents’.

So I am confident that with our colleagues in Rochdale that Merthyr Valleys Homes will be at the forefront of a new way of doing housing, and a better way of doing business.

Mike Owen runs Merthyr Valley Homes, which recently converted into a tenant and employee-owned mutual

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