Housing in Wales

On 26/10/202026/10/2020 By JacIn Housing Associations, Public Funding, Welsh Government58 Comments

PLEASE APPRECIATE THAT I GET SENT MORE INFORMATION AND LEADS THAN I CAN USE. I TRY TO RESPOND TO EVERYONE WHO CONTACTS ME BUT I CANNOT POSSIBLY USE EVERY BIT OF INFORMATION I’M SENT. DIOLCH YN FAWR

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The title tells you what this week’s article is about. I’m going to look at how the picture has changed in the past few years.

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THE BIG PICTURE

Obviously, there are different types of housing, from mansions like Jac o’ the North Towers to more modest owner-occupied properties; then we have social rent properties, and properties rented from private landlords.

So let’s start by looking at how types of tenure have changed over the past two decades. (The year up to March 31, 2001 is the earliest I can find on the StatsWales website.)

The table I’ve drawn up is fairly self-explanatory. ‘Registered Social Landlord’ (RSL) is of course the official term for housing associations.

The headline figure is that there are 163,067 more dwellings or housing units in 2020 than there were in 2001. Though in the same period the population rose from 2,910,232 to 3,152,879, while the average household size fell from 2.36 to 2.26.

In fact, if we multiply the total number of housing units by the average household size we arrive at a figure of 3,248,901.42. Almost a hundred thousand more than the population estimate. But of course calculations are complicated by people living in care homes, prisons and other institutions. And then there are holiday homes. And properties that have just been abandoned, where it’s often difficult to track the owner.

So, all things considered – and without taking my socks off to do some really serious figuring! – we have roughly the same availability of housing in relation to demand as we had twenty years ago. Maybe things are worse.

Something else we can extract from the table is that in 2001 19% of Welsh properties were social rents, whereas the figure today is just 16%.

But perhaps the biggest change has been the doubling in the percentage of properties now rented from private landlords.

If current trends continue then very soon more people, more families, will rent from private landlords than from councils and housing associations combined. This of course is what the Conservatives want, but why is it happening in ‘progressive’ Wales?

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SOCIAL HOUSING

In 2001 we had 242,853 units of social housing. By 2020 this had fallen to 229,902, a decrease of 12,951. Found in this table.

Partly explained by 34,829 units being sold in this period under the Right to Buy legislation introduced in 1980 by the first Thatcher government, with this later supplemented by Right to Acquire.

Though offset by the building of 21,878 social rented housing units in the same period. Just over 1,000 a year.

Right to Acquire is Englandandwales legislation introduced by the Blair government and in operation from 18 January, 2005. Explained more fully here.

At this point I should tell you that not all sales of social housing are accounted for by Right to Buy and Right to Acquire because this table tells us there have also been sales of “non-social housing”. Though I don’t understand why the figure for this category is only shown from 2013 – 2014. Though there’s certainly been a steady increase since then.

Building just over one thousand social housing units a year must be considered a failure after two decades of socialist administrations in Cardiff Bay. Especially when we remember that in 1979 – 1980 (immediately before Right to Buy was introduced) Welsh local authorities built 3,322 new council homes. (RSLs built a further 377.)

And a thousand a year looks even less impressive when we remember that in the period of devolution a couple of billion pounds in capital grant funding has been given to an ever-expanding galaxy of housing associations.

In the past five years alone, £574 million pounds of Social Housing Grant (SHG) has been paid to housing associations. Wales & West, Labour’s favourite, has seen £61m of it.

SHG is not the only capital grant paid. There’s also the Housing Finance Grant.

I’ve drawn up a table for SHG payments you can view by clicking here. It’s quite a big table, so please have patience.

(I should add that while the bottom line is correct I can’t vouch for every figure in every column. I may have made a mistake or two in transcribing them. So here are the figures I received.)

While the amount paid in SHG from 2015 – 2016 to 2019 – 2020 was 20% more than for the previous five years the stock of social rented housing increased in the same period by less than 2%.

We know that housing association executives like to pay themselves big salaries, and drive fancy company cars . . . shiny new offices are a must . . . and how can they miss out on all the conferences and other jollies, but these could never account for the increasing gulf between funding received and social housing built.

Something else must be going on.

If nothing else, Wales is following England in providing less social rented housing. So much for Rhodri Morgan’s, “clear red water”. So much for, “Welsh solutions for Welsh problems”.

The Tories came to power in 2010, and that’s when the decline started. Clearly, the Labour management team in Corruption Bay is following Conservative directives when it comes to social rented housing.

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MONEY, MONEY, MONEY

If we take the period 2014 – 2015 to 2019 – 2020 we see that it covers important changes in the way RSLs are regulated, and also how they operate.

I’m sure most people didn’t notice, but in the past five years Welsh housing associations were originally private bodies, were then made public, before being privatised again.

It was the Office for National Statistics that decided they should be public bodies due to the amount of public funding they were receiving. Plus the political involvement. But making them public bodies transferred their debts to the public ledger and so the parliaments in London, Edinburgh, Belfast and Cardiff quickly privatised them again.

It’s explained clearly and succinctly in the article below from Inside Housing, just click on it to make it readable. (Here’s a link to the original article.)

I bet you’re thinking . . . ‘If housing associations are now private companies, why are they still getting lashings of public funding?’ Funding that, as we’ve seen, has greatly increased since they were ‘re-privatised’!

The answer is that they’ve branched out into building private housing.

To such an extent that, in addition to the public funding, our housing associations are also taking out private loans with various financial institutions.

Here’s a report from May of United Welsh of Caerphilly, which has just 6,000 properties, borrowing £50m from Scottish Widows.

In July we learnt Coastal Housing Group of Swansea had entered into a £250m ‘refinancing’ deal with Aviva Investors.

In August, Cadwyn Housing Association of Cardiff did a deal with Westbourne Capital Partners of Chicago.

And other housing associations have done similar deals with organisations much sharper than them in the ways of the financial world. I do hope they’ve read the small print.

Though I suppose the only real collateral housing associations have is their housing stock. If they default, does this mean that Welsh social housing stock gets taken over by lenders? Or will the ‘Welsh Government’ step in with yet more money?

Talking of the ‘Welsh Government’, if RSLs need money for investment, why can’t they go to the Development Bank of Wales (DBW), which is already lending to other builders, many from over the border?

So let’s recap. Housing associations, now private bodies, still receive increasing amounts of public funding. Yet they also enter into arrangements with financial institutions around the world. And let’s not forget that the other major source of income – perhaps the major source – is rents from the housing stock they own. Most of which came free as stock transfers from local authorities.

Another noteworthy feature in this period is that most if not all of our housing associations have set up subsidiary companies, or companies that are not subsidiaries but still part of the group.

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SUBSIDIARIES, PARTNERS, PRIVATE HOUSING

An example would be the relationship between Ateb (formerly Pembrokeshire Housing Association) and Mill Bay Homes Ltd (MBH). The latter, despite being a separate company, is a “wholly controlled subsidiary company of Ateb Group Ltd”.

The arrangement is that MBH builds and sells market properties and the profits go to parent company Ateb to build social housing or ‘affordable homes’. Which might be fine if Mill Bay Homes had its own money . . . but it hasn’t, it relies on loans from Ateb.

Which means that the ‘Welsh Government’ funds a RSL to build social housing but the money in fact goes to a subsidiary to build open market homes (that most locals may not be able to afford) with a fraction of the original money returning to the parent company.

What is the point of such a system?

While Mill Bay Homes is a company registered with Companies House the Ateb Group is registered with the Financial Conduct Authority.

As we’ve seen with other housing associations, the Ateb Group has also borrowed money recently. Last month from the Principality Building Society. Back in July it was a loan of £18m from bLEND Funding PLC.

Officially, a cash security trust deed.

Eighteen bloody million! How much does a relatively small, rural housing association need? It’s already getting money from the ‘Welsh Government’, and seems to have stopped providing social rented housing.

A visit to the Ateb Group website turns up what you see below. Quite clearly, Ateb is now a private house builder with social rented accommodation an afterthought.

Click on ‘homes for sale’ and you of course get taken to the Mill Bay Homes website.

And there seem to be some rum doings between the two.

I am indebted to Wynne Jones in Cardigan for these documents from the Land Registry website (from which I have redacted a few names in the second).

A property on this development in Cilgerran (Ceredigion) was built by MBH, with money borrowed from Ateb, then sold to Ateb for £164,950 in October 2019; the following month Ateb sold a 125-year lease on the property for £57,733.

What business model is this?

Mill Bay Homes makes no secret of the fact that it’s punting for retirees and ‘investors’. The latter category will include Buy-to-Rent landlords, and whaddya know – one of the new Cilgerran properties is already being advertised for rent.

Plot 3 at Maes Rheithordy, Cilgerran, is being rented for £670 per calendar month through Jac y Do Letting of Blaenporth.

A similar arrangement to that between Ateb and Mill Bay Homes exists in Gwynedd between Adra (formerly Cartrefi Cymunedol Gwynedd), which took over Gwynedd council’s housing stock some ten years ago, and its subsidiary, Medra Cyf.

A few days ago Adra put out this puff about building 1,200 new homes across ‘North Wales’. The “housing crisis” referred to is perhaps the lack of housing for commuters in the A55 corridor.

The subsidiary that will be doing much of the building is Medra . . . with a loan from Adra.

This loan between a Welsh RSL and its subsidiary was arranged by London law firm Trowers & Hamlins. I’ve seen that name in other loans I’ve looked at. Are there no lawyers in Wales?

Of course there are, so who’s directing them to that company?

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Also worth highlighting from recent years, in addition to the proliferation of subsidiaries, is the strange partnerships we see being forged.

For an example of this we stay in the north, with Cartrefi Conwy, based in Abergele.

I’ve written about this lot a few times. Below you’ll read what I had to say earlier this year, in Housing Associations, a broken model. The Byzantine network of ‘partners’ also throws up a mystery investor.

“Cartrefi Conwy set up a subsidiary in 2015 called Creating Enterprise CIC (Community Interest Company). Then, in May 2018, Creating Enterprise went into partnership with Brenig Developments Ltd to form Calon Homes. (Assets at 31 May 2019 £37,853.)

From the Creating Enterprise CIC accounts for y/e 31 March 2019. Click to enlarge

As I wrote back in November: “There is a charge against Calon Homes LLP held by Creating Enterprise CIC, which in turn has a charge held by Cartrefi Conwy. Which means that, ultimately, housing association Cartrefi Conwy is in partnership with private company Brenig Developments.”

When we look at the directors for Brenig Developments Ltd we find Mark Timothy Parry and Howard Rhys Vaughan. Both are also directors of Brenig Homes Ltd.”

Another horse out of the Brenig stable is Brenig Construction Ltd. Just another local building firm, run by local people . . . so impeccably local in fact that it could have come from League of Gentlemen.

But then, in December last year, a new director joined, a man who might have been taking his life in his hands if he’d turned up in the Royston Vasey shop.

I’m referring now to Yin Han, a Chinese businessman, presumably bringing a lot of yuan. For when I say Chinese businessman I do not mean that he hails from Hong Kong or Taiwan. Yin Han is a resident and citizen of the People’s Republic of China.

How did Yin Han and Brenig Construction find each other? What do we know about him? I guarantee he did not get involved with Brenig Construction without permission from back home. And that means the Communist Party.

These subsidiaries and partners, together with the loans and investment, are needed to build private housing for sale on the open market.

But housing associations are now private entities, so why do they need subsidiaries and partners to build open market housing? Surely they could do it in their own names?

Of course they could, but that would make it too obvious and probably jeopardise the public funding. So we have this charade of public money for social housing being given to RSLs and then filtered through intermediaries to build private housing.

And the ‘Welsh Government’ is a willing party to this deception.

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‘AFFORDABLE HOUSING’

As a student of history, I’ve always loved Palmerston’s quote: “Only three people have ever really understood the Schleswig-Holstein business – the Prince Consort, who is dead – a German professor, who has gone mad – and I, who have forgotten all about it.”

It comes to mind when I see the term ‘affordable housing’. Because there’s a great deal of confusion as to what it means.

It’s important to get a definition because it’s what RSLs now claim to be building, and what the so-called ‘Welsh Government’ is funding.

Is the ‘Welsh Government’ really proud of these figures? And ‘Rent to own’ in fact offers people a share of a lease! Click to enlarge

When I contacted the ‘Welsh Government’ I was referred to a publication wherein was found . . .

“The concept of affordability is generally defined as the ability of households or potential households to purchase or rent property that satisfies the needs of the household without subsidy (further guidance is provided in the Local Housing Market Assessment Guide) 7 This could be based on an assessment of the ratio of household income or earnings to the price of property to buy or rent available in the open market in the required local housing market area.”

Which is interesting, and for two reasons.

If the concept of affordability is based on what local people on local wages can afford, then why is ‘affordable housing’ not reserved for those same local people? I ask because all the term means in practice is that a few properties in a development are labelled ‘affordable’ – but still put on the open market.

And if a small number of properties in a development are classed as ‘affordable’ then it must follow that the majority of the properties are regarded as unaffordable to most locals. So why are we building so many properties – with public funding! – beyond the reach of most local buyers?

The woolly term ‘affordable housing’ is just a fig leaf for the ‘Welsh Government’ and RSLs to disguise the fact that very little social housing is being delivered.

We are encouraged to believe that ‘affordable housing’ is for local people, or that it means social rented properties. Wrong.

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CONCLUSION

This system, as I’ve argued before, is broken. It is broken because it consumes vast amounts of Welsh public funding for little or no Welsh public benefit.

Another cause for concern is that just as many third sector bodies are agencies of the Labour Party a similar picture emerges with housing associations.

In fact, housing associations and third sector bodies operate hand in glove, with the former housing the disruptive ‘clients’ of the latter, many of whom have been shipped into Wales. It’s collaboration like this that contributes to the problems we’ve looked at in Tyisha, Llanelli.

‘Welsh’ Labour’s little empire; stuffed with cronies and others dependent on political patronage and public handouts.

Take Wales & West, which I’ve referred to as Labour’s favourite. The CEO is Anne Hinchey, whose hubby Graham is a Labour Councillor in Cardiff. This explains why Wales & West has pulled down £100m in Social Housing Grant alone in the past decade.

And yet, let us remember that the reason the Office for National Statistics decided to put housing associations into the public sector was because there was so much governmental control!

As the June 2018 article from Inside Housing I reproduced above put it,

“In a letter to the Welsh Government sent yesterday, the ONS left open the possibility to reclassify individual associations as public should the level of state control increase.”

A strong case could be made for reclassifying a number of Welsh housing associations. Certainly Wales & West.

Where do we go from here?

I suggest that it starts with making it clear we do not want housing associations to build properties for sale to Home Counties retirees in Pembrokeshire, or to Manchester commuters in Denbighshire.

The sole duty of Welsh housing associations must be to deliver homes to Welsh people at sales prices or rents WE can afford.

If they are unable or unwilling to fulfil that role then I believe we should let our local councils provide social rented housing. Ensure they are well enough funded to provide decent accommodation to any and all local people wanting it. And make strong local connections the over-riding consideration in allocating those properties.

Then cut all funding to housing associations, which are, after all, private companies. Let them borrow from private lenders – as they are already doing – and cease being a burden on the public purse.

Whatever is decided, the present system is broken. Changes must be made. Even if you think this doesn’t affect you, just think what we could do with the money saved!

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Housing Associations, a broken model

On 16/03/202018/03/2020 By JacIn Colonisation of Wales, Housing Associations, Welsh Government22 Comments

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In an earlier post I dealt with Wales & West Housing, a housing association that has branched out into all manner of accommodation, including luxury flats.

For a few weeks I’ve been promising you more news. Finally – here it is!

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WALES AND WEST, CARDIGAN HOSPITAL, MID WALES HOUSING

A speciality of Wales & West is importing criminals, drug addicts and other undesirables. But it’s good business, for local authorities and other agencies over the border will pay well to dump people in Wales.

Of course, it’s not so good for small towns that have to host these people. Lampeter being one that Wales & West has damaged in recent years. For as I was recently told, “Wales and West do not operate local allocation policies”.

And all this has been facilitated with funding from the Welsh public purse. For we pay for Registered Social Landlords (RSLs) to import riff-raff and build luxury flats for sale to English retirees.

This public money will invariably be ‘filtered’ through the parent company – which will be a Registered Social Landlord – to a subsidiary, which may or may not be registered as a RSL. And in some cases, not obviously linked to a RSL.

In the example brought to light by a comment to the earlier post by ‘Dai’ the W&W subsidiary could either be Enfys Developments Limited (formerly Enfys Developments Ltd), or Castell Homes Limited.

Though neither is shown in the ‘Welsh Government’s list of RSLs. A quick check found other omissions, making this an incomplete and misleading document.

Enfys Developments was founded in 2012 and seems to be the main vehicle for W&W’s new builds. While Castell Homes was formed as recently as January 2018, almost certainly in anticipation of the Regulation of Registered Social Landlords (Wales) Act 2018, which effectively privatised RSLs in response to the Office for National Statistics’ threat to reclassify them as public bodies.

As we read below, Castell Homes is, effectively, a private builder, promising to pass on its profits to the parent company for Wales & West to build social housing. It’s up to you whether you believe that.

There are a few other things worth picking out of the clip below from the only accounts thus far filed for Castell Homes.

For example, we read that Castell Homes “was established with the purpose of building and selling homes in communities where a housing need is identified”. The operative word should be ‘demand’, not ‘need’. For this will be private housing, often beyond the financial reach of most locals.

We also read that “Castell Homes has its own board of directors”. Yes and no. Yes, there is a board of directors, but it’s the senior management team of Wales & West. Any pretence that Castell is independent of W&W would be just that, a pretence.

As ‘Dai’ mentions in his contribution, Wales & West is in negotiations with Hywel Dda University Health Board to buy the old Cardigan Hospital site. Though locals are puzzled as to why, if W&W doesn’t own the site, it’s been behaving for months as if it does.

The answer is of course that the deal was done long ago by the Labour Party behind closed doors, looking after its favourite housing association, yet again. Wales & West CEO is Anne Hinchey, wife of Cardiff Labour councillor Graham Hinchey. Mrs Hinchey previously worked for Cardiff Council.

Though I should also mention Keith Davies, housing strategy officer at Ceredigion council, a big friend of Wales & West who has appeared on this blog before. Keith was also very keen for Wales & West to take over the old hospital.

The open day held on February 29 was very well-attended and reported in the Tivy-side Advertiser. Curiously, this imparter of local news saw no contradiction in using ‘community has its say’ in the headline . . . and then quoting only spokespersons for Wales & West!

As I keep saying, Wales & West is very well connected in Corruption Bay and all sorts of deals are being lined up. Among them perhaps the takeover of Mid Wales Housing, and this despite MWH having been in merger talks with Tai Ceredigion for some time. And now might be the ideal time.

For not only has MWH hit a rocky patch in the regulatory sense, having been downgraded on grounds of poor governance and financial management, but other factors are also contributing to a general picture of incompetence and decline.

For a start, Mid Wales paid over the odds for its repair contractor EOM Ltd and turned it from a profit-making SME into a loss-making subsidiary. MWH has also failed to deliver the Cylch Caron extra care facility in Tregaron for the county council, increasing pressure on the council leader following the closure of the Bodlondeb home in Aberystwyth.

And then chief executive Shane Perkins recently stepped down (though he’d been off sick since September). To those who may be wondering, I can tell you he’s not one of the Pembrokeshire Perkins, but comes from Bournemouth, to which he and his good lady wife have now returned.

From the Mid Wales Housing Facebook page. Click to enlarge

Filling in until a new CEO is appointed is Charles Brotherton . . . despite being the genius behind the EOM fiasco. Charles joined MWH in 2010 from an English housing association. Chairman of Mid Wales Housing, and Lloyds ‘name’, is Peter Swanson, who is also a “Past chair of Dyfed Powys Health Authority. A Justice of the Peace. Past Chair of Dyfed Powys Health Authority and former Chair of Powys County Council Standards Committee. Private landlord.”

Swanson is an old-fashioned quango man of the type devolution is supposed to have made extinct. But they’re still roaming the land. And thriving. Especially in areas where the Labour Party is weak in terms of local support and prefers to appoint such people rather than give power to non-Labour locals.

This is truly one of the more bizarre manifestations of patronage in the age of devolution.

As you can see from the Board of Management, Welsh involvement in MWH is kept to a minimum; ‘cos we Welsh is dull an’ can’t do nuffin for ourselves, innit’.

This is Englandandwales, folks. The only way out of this nightmare is independence.

To conclude, let me hypothesise that these multiple cock-ups at Mid Wales Housing are being allowed in order to justify someone in Corruption Bay deciding – as was done with Tai Cantref – that something must be done, and that ‘something’ means calling in ‘Welsh’ Labour’s elite troops in the form of Wales and West Housing.

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CARTREFI CONWY, ASSOCIATES, CHINESE INVESTORS

But you mustn’t think that such machinations are confined to the southern parts of our benighted land. Because the story from the north that I’m about to relate is even more bizarre. Though you won’t be surprised to learn that it also involves Wales & West.

Let’s start with this recent story from the Daily Post for a new housing development on the A55 commuter/retirement corridor. Nothing surprising about that you might think, developers are forever looking to Wales to protect property values in the ‘Golden Triangle’.

It only begins to look odd when we start joining up the dots.

You’ll see in the news report that the company wanting to build these new houses is Calon Homes LLP. That is, Limited Liability Partnership, an opaque structure of a kind that would not be allowed in many countries. Now it looks as if even BoJo’s government is looking to clean things up a bit.

I particularly liked, “Legislation will be introduced in Finance Bill 2020 with retrospective and future effect to underline that LLPs are expected to follow the rules”. And about bloody time too!

So who are or what is Calon Homes LLP?

Calon Homes appeared in an article I wrote in November, when I looked at Cartrefi Conwy Cyf. (I urge you to read it.) But to cut a long story short . . . Cartrefi Conwy set up a subsidiary in 2015 called Creating Enterprise CIC (Community Interest Company). Then, in May 2018, Creating Enterprise went into partnership with Brenig Developments Ltd to form Calon Homes. (Assets at 31 May 2019 £37,853.)

When we look at the directors for Brenig Developments Ltd we find Mark Timothy Parry and Howard Rhys Vaughan. Both are also directors of Brenig Homes Ltd.

I don’t know if Mark Parry is related to Peter John Parry, the chairman of Creating Enterprise CIC, the Cartrefi Conwy subsidiary, it doesn’t really matter.

Peter John Parry seems to have joined Creating Enterprise CIC 31 August 2017. By which time his personal business career was already on the rocks, with a string of dissolved companies in 2017 and 2018. (Listed here.)

Calon Homes, jointly owned by Creating Enterprise CIC/Cartrefi Conwy Cyf and Brenig Developments Ltd, was Incorporated 12 May 2018. But just a month earlier Companies House registered Calon Developments Ltd. Among the directors at Calon Developments we see Mark Parry and Howard Vaughan, of the Brenig companies, and also Andrew Bowden, CEO of Cartrefi Conwy!

It is very unusual for the head honcho of a housing association to go into partnership with a private builder directly. The realisation that this don’t look good might explain why those involved with Calon Developments Ltd now want voluntary strike-off.

As if I haven’t introduced enough subsidiaries and partnerships and companies, I’m now going to introduce another. We’ve had Brenig Developments Ltd and Brenig Homes Ltd, but there’s a third company in the stable, and it’s Brenig Construction Ltd.

The latest (unaudited and abridged) accounts available – y/e 31 October 2018 – tell us that Brenig Construction had assets of £206,806. When we turn to the directors, we find, as expected, Parry and Vaughan . . . but also Yin Han, a citizen and resident of the People’s Republic of China. He joined the company 12 December 2019.

I’m sure that, like me, you’re wondering why a Chinese citizen would join a relatively small building firm in Denbighshire.

Perhaps because Parry and Vaughan have friends in high places within the Cartrefi Conwy group. Which might explain this report from last November that tells that “From a standing start in 2012, Brenig now employs 70 people directly and is turning over £11 million a year, with £21 million of work already secured in future contracts.”

Though I’m having difficulty reconciling the claimed turnover with the figures available at Companies House for the three Brenig companies. Brenig Developments is filing as a dormant company and the other two don’t seem to be challenging Wimpey and Redrow.

But as I’ve found so often, when dealing with interlinked companies and bodies of often obscure construction, figuring out who does what, and where the money comes from, and where it goes, is often very difficult. Which is what makes such arrangements attractive for some.

But it seems we can identify one source of future income for Parry and Vaughan, and that’s our old friends Wales & West! The report comes complete with another pic of the smiling lads in hi viz jackets. With every reason to smile.

If you sense fatigue creeping up due to the number of different companies I’ve already mentioned, I can only urge you to bear with me while I list a few more, because Mark Parry has been a busy boy.

Back in 2010 he and his mate Vaughan formed H & M Construction Solutions Ltd. But this outfit appeared to crash on take-off, because there is nothing filed with Companies House and this is all I can find.

Next up is Tai Beech Ltd, Incorporated 26 April 2013 and compulsorily struck off in November 2018. Parry and Vaughan were there at the start and saw it through.

Then – something of a departure this – there was Applejack Diners Ltd. Formed 28 November 2013 this company went belly-up 7 December 2016.

One Parry-Vaughan company still with us is Seel Plant Hire Ltd, Incorporated 5 August 2014. But as with the others we’ve looked at, the ‘Micro-entity accounts’ available for Seel Plant Hire do not suggest a company taking the world by storm. Perhaps the gentlest of zephyrs.

And yet, Parry and Vaughan are pulling in big contracts, and Chinese investors. What does it all mean?

Possibly, with CEO Andrew Bowden looking to retire, and Wales & West getting in on the act, Cartrefi Conwy may be the next to be swallowed up by ‘Welsh’ Labour’s favourite housing association.

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WEAPONS GRADE BOLLOCKS

What we have been looking at here is a dysfunctional system

I say that because most people still believe that housing associations provide good rented accommodation for people who either can’t afford to buy or just prefer to rent. They do, but they are building very few new units of social rented housing, basing their claim to being social landlords on the stock most of them inherited from local authorities.

Since Registered Social Landlords were privatised by the Regulation of Registered Social Landlords (Wales) Act 2018, they have focused almost exclusively on building private housing.

And yet the pretence is maintained. Perhaps to ensure that they continue receiving public funding from the ‘Welsh Government’.

To help disguise their true business, our housing associations launch subsidiaries and go into partnership with private companies. In many cases to build housing not for any local demand but for pure profit. That is certainly what Wales & West and Cartrefi Conwy are planning along the A55.

Is this really how housing associations are supposed to operate? Is this how we want them to operate?

Andrew Bowden, CEO of Cartrefi Conwy, said recently: “As a group, Cartrefi Conwy are looking to diversify to generate new income streams to further our affordable housing programme.

“Until now, we’ve always been reliant on just rental income but, with the advent of austerity and things like Universal Credit, we had to think outside the box.

“Calon Homes will be building houses for market sale and we will be using our share of the profit for the benefit of local people to create more affordable housing.”

But why not use all the money to build affordable housing, rather than the much smaller amount that comes in the form of profit from open market housing? Though come to that, ‘affordable housing’ is yet another misnomer. It means open market housing, and I’ve seen houses costing £250,000 classed as ‘affordable’.

As for ‘new income streams’, Peter John Parry of Creating Enterprise CIC, has a background in running homes for very disturbed and often dangerous patients. This was one of his establishments. Will he be bringing clients down the A55, to add to the burden on the Betsi Cadwaladr University Health Board, already in special measures? And the police workload?

For RSLs to defend themselves by saying that the open market housing is being built by subsidiaries – wholly-owned subsidiaries! – or partners, is unacceptable.

The system is out of control. It is operating against the Welsh national interest. The time has come to de-register most RSLs because they are private companies building open market housing and managing rented stock that in most cases was built by someone else. Restrict the ‘RSL’ label to groups and bodies building social rented housing for local people. Because that’s what ‘housing association’ is supposed to mean. And it’s what it should mean.

Another clue telling us that the current system is broken is that local authorities have started building council housing again. Swansea and Cardiff are two examples.

Let me end on a lighter note . . . or maybe this will send you over the edge. Last Friday Community Housing Cymru – the umbrella body for RSLs – brought out a report claiming that its members, building 75,000 ‘affordable’ homes (that word again!) will put £23.2bn into the Welsh economy and create 50,000 jobs.

This is ‘think of a number, double it . . . ‘ economics. I’m surprised they didn’t also claim to have found a cure for Covid-19.

And because it was the purest and most unadulterated bullshit it was sad to see Martin Shipton at Llais y Sais write it up as if it was Gospel.

I’m now now wondering for which fiction award I should enter this gem. Because it’s certainly not meant to be taken seriously.

♦ end ♦

Housing associations: subsidiaries, partners, etc

On 25/11/201926/11/2019 By JacIn Colonisation of Wales, Housing Associations, Welsh Government36 Comments

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Social housing is an issue I’ve written about many times over the years, and I make no apologies for returning to the subject again. For the old problems remain and new ones are emerging.

The old problems are:

An ‘arms race’ among housing associations to build more and more properties (often where there is little local need) to deter predators from swallowing them up.
Certain housing associations being very close to the Labour management team in Cardiff docks with this closeness giving them an unfair advantage over competitors.
I say ‘competitors’ because, unlike the old system of the local council being the major or sole provider of social rented housing in a locality, we now have any number of housing associations operating in the same area.
Social tenancy allocations in Wales being made on an Englandandwales basis.

WARNING: This report gets complicated given all the players and different commercial entities. So sit up straight and pay attention!

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‘BUILD THEM AND THEY WILL COME’

Cartrefi Conwy Cyf came into existence in 2008 with the transfer of Conwy council’s housing stock. In 2015 it branched out with the creation of a subsidiary, Creating Enterprise CIC (Community Interest Company).

Creating Enterprise CIC is now seeking ‘new income streams’ on the north coast, an area where north west England likes to dump its social problems.

What could possibly go wrong?

From the Creating Enterprise CIC Accounts. Click to enlarge

And Creating Enterprise CIC would appear to have found new sources of income, for the latest accounts tell us that turnover increased by over 700% between 2017 and 2019. That is impressive.

As stated, Creating Enterprise is a subsidiary of Cartrefi Conwy (and many or even most of its ’employees’ may be Cartrefi Conwy tenants) that maintains and upgrades Cartrefi Conwy properties. Nothing unusual in that, many housing associations have in-house maintenance teams.

But there’s not much profit in such an arrangement, it’s just a housing association giving work to a wholly-owned subsidiary. The only way to make money is for the subsidiary to branch out. Which is what has happened with Creating Enterprise CIC.

But now it gets a bit complicated.

For while Companies House confirms that Creating Enterprise CIC exists, and with a charge held by Cartrefi Conwy that confirms CE’s subsidiary status, there is another Companies House entry for Creating Enterprise CIC, linking it with Calon Homes LLP. Explained in the panel below taken from Creating Enterprise CIC’s accounts.

As you’re read, the other partner in Calon Homes LLP is Brenig Developments Limited. There is a charge against Calon Homes LLP held by Creating Enterprise CIC, which in turn has a charge held by Cartrefi Conwy. Which means that, ultimately, housing association Cartrefi Conwy is in partnership with private company Brenig Developments.

Curiously, there is another, and different, Companies House entry for B renig Developments Ltd suggesting that it’s a dormant company. To confuse matters further there is also a Brenig Construction Limited and a Brenig Homes Ltd. (None of which should be confused with Brenig Fish & Chips of Tregaron. Pass the vinegar!)

First question: Why did Cartrefi Conwy Cyf, via Creating Enterprise CIC, go into partnership with a dormant company?

Second question: There is an outstanding charge against Brenig Homes Ltd with Kennah Motor Credit Ltd, of Cheshire, a dissolved company. But why would a building firm seek credit from an auto finance company?

Third question: This report from Wales247 in September tells us that Calon Homes is building 11 houses in Middlewich, Cheshire. Why is a company half-owned by a publicly-funded Welsh housing association building private dwellings in England?

Fourth question: The architects involved with Calon Homes’ 111 Conwy properties mentioned in the Wales247 report are Base Architecture and Design, which is expanding. Does this (from the report I’ve linked to) give the game away, “Conwy is a thriving area with a lot of development and investment going on, particularly along the A55 corridor through to Anglesey,”

Fifth question: Why do we also read of Base Architecture and Design, “Its clients in the region include Brenig Construction, one of North Wales’ leading civil engineering and construction companies”? At 31.10.2018 Brenig Construction Ltd had a net book value of just £84,637.

Sixth question: This report, from last Thursday, tells us that Creating Enterprise is “in partnership with Norfolk-based Beattie Passive”. The only Beattie Passive company in Norfolk is Beattie Passive Norse Ltd. This company has ‘accumulated losses’ of £4,589,441. That’s £4.5m.

What we have here is a publicly-funded housing association – whose assets consist primarily of a stock transfer of council housing – playing at being a private company through subsidiaries and partnerships. Cartrefi Conwy justifies building properties for commuters, retirees and others from over the border by arguing that its share of the profits from this work will be used to build social housing.

But is that a sensible model? Let’s say Cartrefi Conwy lends Creating Enterprise CIC one million pounds that in turn is lent to Calon Homes to build in partnership with a private company. And let’s say that the profit on that project is £500,000. After being split with the private developer, and after admin, staff, and other costs are taken out by Creating Enterprise and Calon Homes, Cartrefi Conwy might be lucky to get back £50,000 for social housing. So why not just spend the original £1m on social housing?

The true purpose is building open market housing along the A55 commuter/retirement belt. And when we realise that most of Cartrefi Conwy’s other efforts go into providing care homes, retirement bungalows and flats, it becomes clear that it’s just an agency for the further colonisation of Wales.

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OLD AND NEW

In the introduction I listed the established problems with ‘social housing’ in Wales. Having got this far you’ll know that the new problems stem from diversification.

But the problem is not confined to Cartrefi Conwy. Let’s go to the other end of the country and look at Mill Bay Homes in Pembrokeshire, a private company and a subsidiary of Ateb (formerly Pembrokeshire Housing). Despite being a private company Mill Bay has a “revolving credit facility with the parent”, Ateb.

Which in practice means that money held by Ateb that should be used to provide social housing is loaned to Mill Bay to build homes for ‘investors‘, ‘retirees‘ and others, including holiday home buyers. (Check those links.)

Clearly, the system in Pembrokeshire differs from that up north in that instead of entering into a partnership via a subsidiary with a private company, with the subsidiary getting 50% of the profits, Ateb loans money directly to in-house subsidiary MBH, which does the building.

From the Mill Bay Homes accounts 2019. All that money could have been spent on social housing rather than on building holiday homes and properties for investors and retirees. Click to enlarge

But much of Mill Bay Homes’ profits will be eaten up by its own running costs, for it is after all a separate company with its own staff and overheads. Unless MBH is selling its properties at greatly inflated prices it’s difficult to see how it can ever repay Ateb.

An example of how Mill Bay Homes operates is its St Davids’ development. Due to the demand from England for property in and around St Davids most locals experience great difficulty in finding a place to buy at a price they can afford.

Yes, a small number of properties on the new development are reserved for locals (with a very narrow definition of ‘local’) and a small window in which to apply. Otherwise, it’s “32 executive dwellings . . . 2, 3 and 4 bedroom bungalows.”

Executive homes and retirement bungalows. Just what local first-time buyers are looking for!

Mill Bay claims to be meeting the local need in St Davids but in reality it’s just capitalising on the external demand.

But nobody cares, for there is neither regulation nor oversight of housing associations.

An example would be the ‘Welsh Government’s ‘Shared Ownership Wales’ scheme – a disguised form of leasehold – that should only be offered by Registered Social Landlords (registered with WG); yet it’s available in St Davids and elsewhere through Mill Bay Homes, a private company that is not a RSL.

And all the while we hear politicians complain about the lack of social housing, and how we must build more – so more money is given to housing associations . . . and spent on ‘diversification’.

Let’s face it, we are in the same position with ‘social housing’ as we are with the third sector – keep a problem alive and publicised in order to keep the funding flowing. If housing associations wanted to meet the demand for social housing – i.e. for good quality rented accommodation – then they would not be launching subsidiaries.

The bottom line is that social housing in Wales has been privatised, and to pretend otherwise is deceitful. I tried to explain it last year in The Privatisation of Welsh Housing Associations.

Finally, those who think that it’s better to see private housing built by Welsh housing associations than by major English companies should think again. For they don’t challenge Persimmon, Wimpey, and the rest, they complement them by building the smaller developments that the volume builders can’t be bothered with.

The social housing system in Wales is broken, it no longer serves its original purpose. So we need a new system to provide affordable rented accommodation.

♦ end ♦

Jac o' the North

Tag: Brenig Developments Ltd

Housing associations: subsidiaries, partners, etc