The Long Read: Penny Wise And Pound Foolish

The Pennington Report – a report into the failings of East Kent Housing and the four Councils of Canterbury, Dover, Folkestone & Hythe and Thanet – makes it clear their penny wise and pound foolish culture has placed tenants lives at significant risk over a substantial period of eight years.

The penny wise and pound foolish culture has lead to all four Councils, as landlords, not being compliant with  their legal obligations for a considerable period of time. So much so the Regulator of Social Housing is now involved, as is Kent Fire & Rescue Service, who are currently investigating using their powers under the Regulatory Reform (Fire Safety) Order 2005. We also understand the Health & Safety Executive Ashford Office are also investigating the breaches cited by the Pennington Report and others.

The lack of will, leadership, governance, relationship breakdown and appetite, means the four Councils will have to spend millions to rectify the significant non-compliance issues allegedly managed by EKH and overseen by the Councils.

The issues investigated by the Pennington Report (revised on 3 occasions) first came to light following service failures in relation to gas safety and the associated contractual withdrawal of the appointed gas maintenance contractor P & R who we blogged about in May 2018 setting out the service failures.

In that blog post we wrote:

• It is our belief the lack of leadership by the Chief Exec of EKH, Deborah Upton and her two directors, Mark Anderson and Matt Gough, in terms of both act and failure to act, will, we honestly believe, destroy EKH going forward.

The Pennington Report clearly supports our conclusion nineteen months ago. However, the Pennington Report is not a report which just slates East Kent Housing. It shares out the responsibility for the numerous failures and non-compliance issues on the shoulders of all four Councils, who own EKH as well.

In June of this year we called upon all four chief executives to resign due to the significant ongoing non-compliance issues surrounding EKH. We noted at the time because they could only give:

• reassurance that everything is tickety boo, rather than assurance based on solid reliable evidenced data… EKH’s data and record management capability is very limited and that’s putting it mildly.

Again the Pennington report agrees with our conclusions as it says:

• The data held by EKH is not in a state of health that would reflect a robust, mature organisation that has a solid grasp of what is needed to deliver services.

Also let’s remember that only 30% of all properties (5,100 of approx 17,000)  have been inspected through stock condition surveys. Meaning 70% (11,900) of the stock managed by EKH and owned by the four councils has not had a stock condition survey. So as they have no surveys for 11,900 homes, there can be no data and any data they do have, has to be suspect, as their is no evidence of a physical survey being done on the 11,9000 properties.

Below is video evidence that flat 27 Hewitt Rd, let by Dover District Council to a tenant in March 2017, was not part of the stock condition survey. Evidence of fungus in the bathroom, evidence of mould in a ceiling and the state of the front door which is clearly not fire compliant and more. It evidences the data that EKH held/hold was and is flawed. As such could only give reassurance as opposed to assurance that everything thing was hunky dory across the whole housing stock.

The most important aspect of the report we believe is the money. The evidence of the penny wise and pound foolish culture. The report shows how all four Council starved EKH of vital funds.

• Initial costs were reduced as part of moving into the ALMO and then costs have not had inflationary increases until fairly recently such that a real term saving to the councils has arisen. The extent of this is shown below

The report makes it clear that:

• “the focus for the service from the councils has been about cost saving”

This penny wise and pound foolish saving by the Councils, has led to breaches of their legal obligations as landlords under various pieces of legislation around gas safety, fire safety, and legionella. This is evidence of all four Councils cutting finances to their housing stock and by doing so, breach their tenants rights.

In Folkestone & Hythe this means not only should Dr Susan Priest and Cllr David Monk resign, so should the Council’s Client Officer, Adrian Hammond, who interfaced with East Kent Housing.

However, this is local government we are talking about so nobody will  be held accountable and it will become a “system failure“. No evidence will be found of utter incompetence by individuals. The Pennington report is though collective evidence of the Peter Principle throughout all four councils and EKH.

It is not just  Cllr Monk though who should be held to account. Former Folkestone & Hythe District Councillors should also shoulder some of the responsibility as they sat on the board as the Council representatives since EKH’s birth. These Cllrs were:

• Former Cllr Alan Ewart James (Con) Former Cabinet Member for Housing – Appointed on 11 January 2011, resigned on 9 May 2011.

• Cllr David Dury Monk (Con) – Appointed on 9 May 2011, resigned on 8 June 2011.

• Former Cllr Alan Ewart James (Con) – Appointed on 9 June 2011, resigned on 11 December 2014

• Former Cllr Alan Clifton Holt (Con) – Appointed on 16 January 2015, resigned on 8 May 2015

• Former Cllr Alan Ewart James (Con) – Appointed on 9 May 2015, resigned on 12 February 2016.

• Former Cllr Richard (Dick) Anthony Pascoe (Con) – Appointed on 24 February 2016 resigned on 27 October 2016

• Former Cllr David Lionel Godwin Owen (Con) – Appointed on 17 October 2016, resigned on 1 October 2019.

• Cllr David Royce Godfrey (Con) – Appointed on 1 June 2019, resigned on 10 October 2019

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Then there is the former Chairman of the EKH Board. He oversaw most of what went on during the non-complaince, James Queay of Lawson Queay who is a fully qualified Chartered Surveyor. He, plus his replacement, Jamie Weir, should also hold be held responsible for these significant failings.

The penny wise and pound foolish culture by EKH and the four councils will now mean they’ll have to pay millions to rectify the fiften thousand four hundred and ninety seven outstanding issues, set out below:

Fire Safety

At the time of the site visit to EKH, week commencing 21/10/2019, by the Pennington team, there were 4,767 outstanding actions fire risk actions not carried out. Some of the highest risk actions date back to 2018, representing a significant risk to residents and a fundamental failure in the management system to undertake these remedial actions as at present the Councils as landlords are in breach of their legislative requirements.

It is known that Kent Fire & Rescue Service, using their powers under the Regulatory Reform (Fire Safety) Order 2005 are investigating Fire Safety Issues, due to significant safety concerns. Ross House is just one of them.

Legionella

Under ACoP L8 each council has a duty to carry out a risk assessment to identify and evaluate potential sources of risk from exposure to legionella bacteria (pictured)by undertaking a legionella risk assessment (LRA). Eight hundred and seventy six (876) communal blocks across all four Councils have not been assessed for legionella bacteria.  A total of 1,722 legionella risk assessment outstanding, 794 of which have been identified as high risk and have not been actioned for up to three years (Since 2016). This is a direct breach of the requirement for EKH and each of the four councils to make the necessary changes which arise from LRAs and which should be prioritised as a matter of urgency.

Asbestos

In accordance with the Control of Asbestos Regulations 2012, EKH and the four councils have a duty to manage all non-domestic premises (e.g. communal blocks, offices etc.) to find out if there are asbestos containing materials within those premises. There are 715 communal blocks which do not currently have an asbestos report in place, and 327 older surveys of poor quality which do not adequately identify the asbestos risks,  as such the fourc Councils are in breach of these requirements and are at risk of prosecution by the HSE under the Health and Safety at Work Act 1974.

Electrical

The Landlord and Tenant Act 1985 requires the electrical installation in a rented property is safe when the tenancy begins and maintained in a safe condition throughout the tenancy. In order to demonstrate compliance with this (and other legislation including the Health and Safety at Work Act 1974, Electricity at Work Regulations 1989 and Housing Act 2004, etc.), the four councils must adopt periodic electrical inspection and testing programmes for all of their properties. At the time of the investigation by Pennington there were 543 communal blocks and 7,966 domestic properties which do not have a valid Electrical Inspection Condition Report, they are in breach of the legislation, and are subsequently at risk of a range of sanctions including prosecution by the Health & Safety Executive.

All four councils by trying to save a few bob have placed themselves in breach of their legal obligations towards their tenants. EKH has failed in its management obligations. All of them have placed tenants lives at substantial risk that cannot sensibly be ignored having regard to the nature and gravity of the feared harm in this particular case.

The Councils four Chief Executives have now taken over control of the East Kent Housing Board. They did so on the 13th Dec. This means the Board can now dismiss the Chief Executive of East Kent Housing, Deborah Josephine Upton – the wand’rin star –  hopefully without a golden handshake, just redundancy pay.

Deborah Joshephine Upton (pictured) sent us a pre-protocol letter to initiate legal proceedings against the Shepwayvox Team on the 1st August 2019.  She has not followed up with her threat. We would welcome the opportunity to defend ourselves in open court against her allegations that we allegedly published “ inaccurate, dishonest and misleading articles about” her.

As the Chief Exec of EKH who received a £10 grand pay rise in 2018/19, while not managing the mess set out above, we feel it is in the Public Interest to reveal such incidences of breaches of the law. We would love a day in court Mrs Upton.

Mrs Upton is a Solicitor.  Her reckless behaviour in our opinion, means she ought to report herself to the Solicitor Regulation Authority for failing to keep the right side of the law. As the Pennington report makes clear, she along with the four councils need to get broad shoulders, take responsibility and resign over the breaches of legislation. They between them have placed the lives of 30,000 plus tenants at significant and substantial risk for so long, just because they were penny wise and pound foolish.

The Shepwayvox Team

The Velvet Voices of Dissent