Social housing plays a role in our communities. Millions of vulnerable families and individuals rely on it to access affordable accommodation. However, local authorities need help to meet demand
More than 1.2 million families are on the waiting list for properties (over 4% of all UK families), representing an increase of over 88,000 households in five years owing to lack of funding.
Social housing is in high demand
Some councils, such as Thurrock, Croydon and Woking Council, issued a section 114 notice earlier this year, effectively declaring themselves bankrupt.
This highlights how financial pressures are having a real impact on local government.
Technology is vital in helping local authorities and housing associations deliver and maintain services. Yet many housing providers need help with using digital solutions.
Staff often work with systems installed years or decades prior, designed to meet regulatory rather than user needs, without clear paths to upgrade or replace them.
This can result in slower home allocation, overpriced and delayed stock maintenance, poor tenant experiences and, in many cases, significant risk of cyber attacks.
So, how can we address the issue of vendor lock-in in housing management? Without some central government stewardship, it’s here for the foreseeable future.
The illusion of choice of social housing
From the outside, local authorities and housing providers have access to a diverse range of potential partners. Many companies provide solutions ranging from end-to-end services for individual aspects of housing to all-encompassing housing management systems.
But looking at the available information, only a few players account for most new contracts. This is likely because only a few arrangements are going to market.
At the same time, most providers are renewing existing contracts or re-tendering with existing suppliers.
Capita, one of the three most-used housing management system providers, didn’t appear in the data, implying their ‘big three’ market share comes solely from renewals. These factors limit the diversity of technology providers and result in vendor lock-in.
Systemic problem in housing
Despite these challenges, the causes and solutions need to be clear-cut.
Contracts specifying bespoke features and integration points and emphasising price over quality often constrain suppliers.
At the same time, councils looking for flexible solutions that are easy to adopt find that nothing on the market is ready to plug in and use without significant and costly customisation.
Our research on this issue has clarified that no one wants things to be this way. Suppliers wish for good reputations; buyers want the excellent value and services that would earn them.
It’s a systemic problem: it has no single cause, no owner, and, for that reason, only the central government can correct a dysfunctional market.
The three most corrosive factors driving vendor lock-in must be addressed to achieve that.
An element of standardisation of key processes, data protocol or API specs is required, emphasising compliance with regulatory requirements and focusing on long-term strategic planning between suppliers and users.
But what does this mean for social housing management?
Firstly, while localities have different demographics and needs, social housing management is built on the same regulations and services no matter what organisation delivers them.
For example, understanding if an individual is eligible for housing support, applying for a home, reporting a repair, or paying rent.
Yet, despite this commonality, each local instantiation of housing management systems is highly bespoke to local circumstances and policies.
So, when the typical attitude that all the dominant suppliers in the space are very similar, the effort required to move to something new, to rebuild the many bespoke connections needed to make the service work, disincentivises councils from trying something new.
Risk-averse approaches to procurement influence this issue, and the emphasis on complying with regulatory requirements over designing services around user needs.
Buyers are wary of new suppliers, and contracts tend to be so specific to a local context that they leave little room for suppliers to offer something better.
Any attempts to introduce – or require – more common standards must work to change these tendencies, supporting procurement and housing managers to be better, braver buyers.
Additionally, supplier-user relationships have become transactional, focusing on ‘business as usual’ rather than long-term strategic planning.
This means less trust and appetite for the co-creation and experimentation needed to drive change. Therefore, an intervention is required to create the space to build these networks and build a better-shared understanding of a better way forward.
We can’t afford to keep waiting for local authorities
It is estimated that local authorities (excluding housing associations) spend £83m annually on housing technology. That’s before failure demand, poor service outcome costs, contract negotiation and procurement costs.
But it’s not an isolated problem. Developing an approach for housing should quickly inform the same challenges in children’s and adult’s social care. The ripple effects could be gigantic if authorities learn how to correct the market once and do it collaboratively.
A critical ingredient is house ownership
The critical ingredient is ownership
An authoritative convenor needs to front the resources to properly diagnose what’s causing poor access to the right digital tools, develop a position on what will fix it, and either deliver these solutions or identify the rightful owner of each intervention and set them up for success.
In the case of housing, this could look like appraising past interventions in similar problem areas such as Government Digital Service (GDS), the NHS and digital planning, which have learned a lot about influencing suppliers and local authorities alike.
This could make for less repetition and duplication of work and policies and can make implementation easier.
Design patterns have proved extremely useful in engaging local government around common, user-centred approaches, for example, on GDS’s Verify Local projects.
We could create two crucial assets by taking two of the most critical user journeys in housing management – applying for housing support and maintaining a property.
The first would be a blueprint for housing management highlighting the service’s highest value bits that need some enforced standardisation.
The second is design patterns that align housing associations, councils and suppliers around what good looks like to provide user-centred, mitigative services.
Co-designing ways help to bash out some of the more arbitrary design considerations that make it difficult for suppliers to create user-centred products.
On this point, we wouldn’t be starting from scratch – HACT, for example, has begun building some data standards. Likewise, projects like the Local Digital Funded Housing Repairs project have made headway in design patterns.
Using these alignment tools, we’d have something accessible to base active dialogue and collaboration with all stakeholders to the challenge – particularly technology providers.
We need right direction from the central government
Iterating a service blueprint, patterns and knowledge of past precedents with feedback from a broad spectrum of stakeholders would build buy-in to the solutions and confidence in the interventions chosen to scale the adoption of the prescribed standards and patterns.
This isn’t a proposed quick fix. But having witnessed the status quo roll forward, past the user-centred design revolution, into the age of artificial intelligence, it’s time we faced that the system won’t fix itself.
However, with a little stewardship from the right bit of central government, learning from the achievements and failures of GDS, NHS, and DLUHC’s digital planning, we could build game-changing, market-shaping knowledge to fix social housing and all local services facing similar challenges.
This piece was written and provided by Linda O’Halloran, Partner, TPXimpact
