Case Study: Blackpool Coastal Housing
Blackpool Coastal Housing is an ALMO for Blackpool Borough Council managing just over 5,000 of the local authority’s properties.
Collection Rate: 99.89%
Caseload Reduction: 47%
Officer Capacity Created: 1.03 FTE
As with all landlords, Blackpool Coastal Housing (BCH) were experiencing issues presented by on-going welfare reform. The bedroom tax, the benefit cap and Universal Credit have impacted both landlord and their tenants, and as a result meant some residents have less resources to pay their rent. What’s more BCH’s rent roll and business plans, as with all English landlords, have been negatively affected by the 1% rent cut. All this has created an environment where it is tougher to collect rent and protect revenues.
“We wanted to maximise our rental income, as maintaining the level of income into the housing revenue account is one of our key risks on our strategic risk register,” explains Maggie Cornall, Operations Director at Blackpool Coastal Housing.
As a result of the tougher rent collection climate BCH constantly look at how they can maintain their level of income and also examine what best practice is being used in the sector and how they could potentially personalise this to their own needs.
“Our performance as an organisation was good, prior to RentSense, and we benchmark ourselves against our peers who face similar challenges,” comments Maggie.
It was at a RIEN benchmarking group that BCH began to notice several of their peers with good and improving performances were using RentSense, from this BCH began exploring if this was a solution that could also help them maximise their rental income. After visiting other landlords and speaking with Mobysoft, BCH deployed RentSense in May 2016.
At the time BCH were using their Housing Management System (HMS) to manage their arrears caseload, as Maggie explains:
“We had developed this module and spent specific time on work flows and heavily developed the arrears side of the system. We were happy with the system as a HMS, it was a case of other organisations seem to be using RentSense and having success with it on top of their existing HMS.”
BCH’s key risk of protecting revenue, from their risk register, acted as a catalyst for change around income collection,
“We introduced other innovations to complement RentSense, as part of a package of mitigating future risk of welfare reform around maximising productivity. We looked at how do we use the current staff we have more effectively and still maintain that income recovery.”
At the same time they changed processes, such as pre-tenancy support where they the process is more rigorous and also offer greater support at early tenancy stage.
RentSense Predicting Risk
For BCH it was important that RentSense is able to predict risk of those tenants more likely to go into arrears, rather than having officers go into every single case where’s there’s an arrears balance in the HMS.
“That was the key thing as we know that just because there is an arrears balance it does not mean to say that the customer is not going to pay and hasn’t got a history of paying, so why are we bothering looking at those low risk accounts and its more about looking at those higher risk accounts where payment patterns are more unpredictable or the system can suggest they’re less likely to pay. It was the additional intelligence the system could bring over and above what the HMS could offer,” comments Maggie.
Once RentSense was deployed BCH saw their officers’ weekly caseload drop from 1,521, as recommended by their HMS, to 795 cases, a reduction of 47%, which in turn has meant that officers are now getting through their full workload and spending more time on customer contact.
For BCH Universal Credit was viewed as the greatest risk, with residents getting direct payments that are paid once every five weeks, whereas with Housing Benefit BCH it is posted every week, hence the potential impact to income collection was viewed as severe. So, it was important officers had more time to spend on Universal Credit cases to help minimise the risk.
“We have a growing number of people on Universal Credit so we have greater risk to the rental income and yet in reality it has not dipped, RentSense has helped us maintain our income and at high levels,” explains Maggie.
Blackpool Coastal Housing’s board constantly scrutinise collection rates for the organisation and since deployment rates have improved.
“Our 2016/17 year end stats on rent income is a 99.89% collection rate which is similar to last year,” comments Maggie.
Indeed in 2015/16 the collection rate was 99.63% so they have experienced an uplift in collection in spite of rising Universal Credit cases.
“Compared to performance a few years ago this is quite an improvement, and given that it was only implemented in May 2016, and there is that transition period where staff get used to a new system, yet we have managed to maintain our performance,” explains Maggie.
There have been other benefits too for BCH, including how RentSense has also helped create officer capacity of 1.03 FTE within the income team, which in turn has helped their performance and ensure officers complete their workload.
“The idea of RentSense was around productivity and not having to bring in additional staffing resource and around maximising performance, which it has done,” highlights Maggie.
What’s more the level of service Mobysoft offers its customers has also been positive for BCH, as they have regular contact with their Client Success Consultant and Account Director at both an operational and director level.
“It has been positive on an operational level we have regular contact that appears to quickly resolve any issues that may arise. The implementation also went very well and we have regular contact with the account director and that helps identify best practice,” concludes Maggie.