The Regulator of Social Housing (RSH) has published a Regulatory Notice for Highstone Housing Association Limited.  Highstone is a non-profit registered provider which provides supported accommodation to vulnerable adults who receive housing benefit and social care funding. Highstone’s properties were acquired and developed by unregistered related third parties under common control.

The RSH has concluded that:

• Highstone has failed to provide assurance that it is compliant with its adopted code of governance
• there is a lack of clarity on roles and responsibilities between Highstone and the unregistered related third parties
• conflicts of interest exist with the majority of Highstone’s Board holding a financial interest in those unregistered related third parties and Highstone has failed to ensure that the arrangements it has entered into do not inappropriately advance the interests of third parties
• Board reporting on risks, financial performance and accounting is inadequate and the RSH lacks evidence that Highstone undertakes adequate stress testing against a range of scenarios, with appropriate mitigation strategies in place, to ensure its long-term viability
• decision-making is poor due to a lack of appropriate skills and independence
• Highstone has been unable to provide evidence that the board gave appropriate consideration to risks arising from a long lease-based model
• Highstone has been unable to provide evidence of any assurance given to the Board that rent levels are compliant with the Rent Standard and has made inconsistent statements to the RSH about the classification of its stock, the consequences of which could impact on the provider’s ability to meet its financial commitments and
• there is a significant risk that public funds may have been misused and therefore that Highstone may have failed to safeguard taxpayers’ interests and the reputation of the sector.

All of the RJs, RNs and GUR listings published by the RSH can be viewed on the RSH’s website here.