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Planning and performance management post CSR and localism

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Richard Merrick
Richard Merrick

Performant Public Services Event 5th April, 2011 By Richard Bayley - Director of Planning & Performance Places for People

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Public Sector Seminar Richard Bayley Research & Planning Director
Planning & Performance - post CSR & Localism • Economy & Politics • Market dynamics • Opportunities & Risks • Implications for Planning & Performance • Planning has real significance • Performance requires more focus • Summary
UK real GDP annual percentage change 5% 4% 3% 2% 1% 0% -1% -2% -3% -4% -5% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Cebr OBR Budget 2011 OBR November 2011 Darling Budget 2010
Public borrowing target revised upward 180 160 140 120 100 80 60 40 20 0 2009 2010 2011 2012 2013 2014 2015 Cebr forecast Emergency Budget 2010 March 2011 Budget OBR November 2010
Economy • Government deficit not reducing quickly • Big threats are inflation and energy • Real and sustained implications for RPs –Interest Rates –Maintenance (& other external) Costs –Income levels & Benefit rates • What will Gvt response to not meeting its deficit target just before the next election?
Politics • Medium and Long term scenarios –More tax and public expenditure cuts? –It does not matter as aim was to cut Gvt? –Would or Can Labour do anything different? • Reality is that RPs are now in a new world –Gvt funding: little or no public funding –Finance: corporate/mortgage lending tight –Customers: not able to respond to demand
RSL finances 140 130 120 EBITDA interest cover 110 EBITDA MRI EBITDA MRI & Sales 100 90 80 2007 2008 2009 2010
Planning and performance management post CSR and localism
Real disposable incomes 6 5 4 3 2 1 0 -1 -2 2009 2010 2011 2012 2013 2014 Real disposable income Cebr Real disposable income OBR RPI
Planning and performance management post CSR and localism
Opportunities & Risks Opportunities Risks • New tenures • Worsening arrears • New strategic • > inflation increases alliances in external costs • New funding streams • Less grants & local for energy authority services • New investment into • Tighter & more costly the sector debt lending
Implications for Planning & Performance • Business Basics –Cash management (reduce need for lending) –Asset management (maintain profit margins) –Customer service (co-regulatory focus) • Silo systems –Planning has focused on stakeholders –Performance has been driven by regulation –Finance has tended to have historic focus –Risk has tended to be a text book exercise
Planning now has real significance • Vision/Mission –Balance on organic v acquisition growth • Goals/Objectives –Emphasis on customer service & efficiency • Project approach –Organised around external & internal delivery • Deliverables (incl. regulation) –Greater linkages with plans & performance
Performance now requires more focus • Cash Management –Arrears focus due to benefit changes • Asset Management –Profit per property focus to protect margins • Customer Service –Customers & Investors need to know it is good • Performance framework –Process, Satisfaction, Standards, VfM
Summary • Economic & Political realities mean that the housing world has & will continue to change • Opportunities with housing demand still strong & potential for new investment funds • Implications of this new world are: – Longer term planning and scenario analysis – Shorter term predictions of performance – Asset management of whole portfolio – Customer profiling to improve performance and asset management
Questions?
Plenary 2: Richard Neale SAP

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Planning and performance management post CSR and localism

  • 1. Public Sector Seminar Richard Bayley Research & Planning Director
  • 2. Planning & Performance - post CSR & Localism • Economy & Politics • Market dynamics • Opportunities & Risks • Implications for Planning & Performance • Planning has real significance • Performance requires more focus • Summary
  • 3. UK real GDP annual percentage change 5% 4% 3% 2% 1% 0% -1% -2% -3% -4% -5% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Cebr OBR Budget 2011 OBR November 2011 Darling Budget 2010
  • 4. Public borrowing target revised upward 180 160 140 120 100 80 60 40 20 0 2009 2010 2011 2012 2013 2014 2015 Cebr forecast Emergency Budget 2010 March 2011 Budget OBR November 2010
  • 5. Economy • Government deficit not reducing quickly • Big threats are inflation and energy • Real and sustained implications for RPs –Interest Rates –Maintenance (& other external) Costs –Income levels & Benefit rates • What will Gvt response to not meeting its deficit target just before the next election?
  • 6. Politics • Medium and Long term scenarios –More tax and public expenditure cuts? –It does not matter as aim was to cut Gvt? –Would or Can Labour do anything different? • Reality is that RPs are now in a new world –Gvt funding: little or no public funding –Finance: corporate/mortgage lending tight –Customers: not able to respond to demand
  • 7. RSL finances 140 130 120 EBITDA interest cover 110 EBITDA MRI EBITDA MRI & Sales 100 90 80 2007 2008 2009 2010
  • 9. Real disposable incomes 6 5 4 3 2 1 0 -1 -2 2009 2010 2011 2012 2013 2014 Real disposable income Cebr Real disposable income OBR RPI
  • 11. Opportunities & Risks Opportunities Risks • New tenures • Worsening arrears • New strategic • > inflation increases alliances in external costs • New funding streams • Less grants & local for energy authority services • New investment into • Tighter & more costly the sector debt lending
  • 12. Implications for Planning & Performance • Business Basics –Cash management (reduce need for lending) –Asset management (maintain profit margins) –Customer service (co-regulatory focus) • Silo systems –Planning has focused on stakeholders –Performance has been driven by regulation –Finance has tended to have historic focus –Risk has tended to be a text book exercise
  • 13. Planning now has real significance • Vision/Mission –Balance on organic v acquisition growth • Goals/Objectives –Emphasis on customer service & efficiency • Project approach –Organised around external & internal delivery • Deliverables (incl. regulation) –Greater linkages with plans & performance
  • 14. Performance now requires more focus • Cash Management –Arrears focus due to benefit changes • Asset Management –Profit per property focus to protect margins • Customer Service –Customers & Investors need to know it is good • Performance framework –Process, Satisfaction, Standards, VfM
  • 15. Summary • Economic & Political realities mean that the housing world has & will continue to change • Opportunities with housing demand still strong & potential for new investment funds • Implications of this new world are: – Longer term planning and scenario analysis – Shorter term predictions of performance – Asset management of whole portfolio – Customer profiling to improve performance and asset management
  • 17. Plenary 2: Richard Neale SAP