Value for Money - Bournville Village Trust · ii) Value for Money iii) Rent iv) Tenant Involvement and Empowerment v) Home vi) Neighbourhood and Community vii) Tenancy. This document

Year end 31st December 2016

Value for Money Self-Assessment

PAGE 2 | VALUE FOR MONEY SELF-ASSESSMENT 2016

IntroductionIn 2012, the regulator for our sector, the Homes and Communities Agency (HCA), produced a new Regulatory Framework applicable to the whole of the social housing sector.

The Regulatory Framework consists of seven Regulatory Standards covering the following areas:

i) Governance and Financial Viabilityii) Value for Moneyiii) Rentiv) Tenant Involvement and

Empowermentv) Homevi) Neighbourhood and Communityvii) Tenancy.

This document is focussed on the Value for Money (VFM) Standard.

The VFM Standard, amongst other things, requires all Registered Providers (RP) in the sector to publish a self-assessment of their VFM approach which will be accessible and understandable by all their stakeholders.

This document is BVT’s 2016 Self-Assessment, an extract of which is incorporated in BVT’s 2016 financial statements.

Value for MoneySelf-Assessment 2016

I N D E X

Page

Introduction 02

Executive Summary 03

VFM Strategy 05

Governance 06

Benchmarking 08

Return on Assets 13

Social Impact Review 16

Specific VFM Examples 18

Looking Ahead 21

Conclusion 22

VALUE FOR MONEY SELF-ASSESSMENT 2016 | PAGE 3

PAGE 4 | VALUE FOR MONEY SELF-ASSESSMENT 2016 VALUE FOR MONEY SELF-ASSESSMENT 2016 | PAGE 5

1. Executive Summary

This philosophy is embedded into our VFM Strategy, approved by Trustees.

The VFM Strategy recognises that VFM is not just about cutting costs, but is about the balance between economy, efficiency and effectiveness.

It’s about:

• Procuring goods and services as economically as possible whilst ensuring that the quality of those goods and services meets our expectations. Also, allowing managers to consider factors such as preference for local suppliers in determining their procurement choices, thereby supporting the local economy wherever reasonably possible.

• Examining how we work and whether that can be done more efficiently, either through simplifying our working practices or making better use of new technology

• Reviewing the feedback from our customers to see how effective our services are in meeting their needs and constantly looking at how we can do more to improve or expand those services.

In order to deliver the VFM Strategy, Trustees have put mechanisms in place to ensure that the VFM objectives are embedded into our business.

Such mechanisms include:

• Scrutinising the draft budgets and business plans before they are sent to Trustees, ensuring that such budgets and business plans meet key financial targets as well as deliver a reasonable level of headroom against funding covenants

• Setting the relevant key financial targets and updating these as necessary to reflect changing market and economic conditions

• Reviewing all major capital investment decisions and considering the subsequent “Benefits Realisation Reports” to check that the anticipated benefits have been delivered

• Reviewing benchmarking data in order that we can learn from others.

In terms of benchmarking data, BVT subscribes to Housemark, but also looks at other relevant benchmarking data for areas of our business that Housemark does not really cover.

The most recent Housemark report shows that BVT has low overheads and is therefore spending most of its money on front-line services.

This is exactly what we should be doing, but the Housemark report also suggests that we are not as efficient as we might be in delivering some of these front-line services.

This report shows that BVT has made good progress in reducing the cost of some of these services, but that there is more work to be done.

Measures are being put in place which should result in improved efficiency through subsequent VFM self-assessments.

1. Trustees also now have a clearer focus on assessing return on assets. They have established an Asset Management Steering Group to put this area of our business “under the microscope”. Already, this has led to a major strategic decision to transfer all our housing properties in Bromsgrove and Redditch to another reputable and more local Registered Provider. The Asset Management Steering Group looks at more than financial returns on assets. The Group also consider social and environmental factors in making its recommendations to Trustees.

2. Social impact is something that has always been at the heart of our business. A good deal of what BVT is all about is based around social principles rather than financial principles. During 2014, this was demonstrated very clearly through an independent review of six service areas. The review, undertaken by Baker Tilly, was able to show the following in terms of true social impact of these six services.

Anti-Poverty / Welfare Support £1,493,574Selly Manor Museum £800,223Community Halls £1,077,898Community Support £453,042Home Support £471,627Equipment & Adaptations £1,049,158

Total Social Value £5,345,522

We plan to undertake some further social impact reviews during the course of 2017.

3. At the time of the review our annual expenditure in these six service areas is around £750,000, the review effectively demonstrates a social return on investment in excess of 600%. Efficiencies have since been made in the delivery of these services as detailed in the main body of this report.

4. All businesses need to continually consider new opportunities to improve services and achieve better VFM. Section eight of this document sets out the major value for money savings that were delivered during 2016.

5. Clearly, we must continue to look at future opportunities, albeit recognising the increasing challenges arising from Welfare Benefit Reform and more recent changes to the HCA Regulatory Framework. The focus on further VFM improvements therefore continues.

6. A copy of this VFM Self-Assessment is available on BVT’s website bvt.org.uk

BVT acknowledges its responsibility to demonstrate Value for Money (VFM) so we can show our customers and stakeholders that we strive to provide the highest possible level of service for the most cost effective price.

Paul Haywood, Director of Resources at BVT.

2. VFM Strategy

The VFM Strategy, which was last reviewed by Trustees in 2016, sets out the following key objectives which are:

a) To incorporate VFM principles into our existing management, planning and monitoring processes.

b) To adopt recognised best practice, where appropriate.

c) Where considered useful and appropriate, to benchmark our activities against those of similar organisations.

d) To analyse carefully those areas where our costs are higher than other comparable organisations with the aim of reducing costs where it is realistic to do so, or to justify why our costs are higher than other organisations. The HCA’s Unit Cost Analysis will be a key element within this.

e) To evaluate the return on our assets, not just in financial terms, but also in terms of social and environmental returns.

f) To ensure that all staff recognise their continuing obligation to seek VFM as part of their routine activities and to encourage staff to make their own suggestions for how services and processes can be improved.

The Strategy recognises that VFM is not just about cutting costs, but is about the balance between economy, efficiency and effectiveness.

It’s about:

• Procuring goods and services as economically as possible whilst ensuring that the quality of those goods and services meets our expectations. Also, allowing managers to consider factors such as preference for local suppliers in determining their procurement choices, thereby supporting the local economy wherever reasonably possible.

• Examining how we work and whether that can be done more efficiently either through simplifying our working practices or making better use of new technology

• Reviewing the feedback from our customers to see how effective our services are in meeting their needs and constantly looking at how we can do more to improve or expand those services.

Some examples of how we have improved VFM in each of these categories are set out later in this document.

The starting point for any VFM self-assessment must be BVT’s VFM Strategy.

All Trust committees monitor financial and non-financial performance in their areas of the business, albeit the main focus is through the Finance, Audit and General Purposes (FAGP) Committee.

The main methods that FAGP Committee use to assess VFM across the Trust are:

i) Scrutinising the draft budgets and business plans before they are sent to Trustees, ensuring that such budgets and business plans meet key financial targets as well as deliver a reasonable level of headroom against funding covenants

ii) Setting the relevant key financial targets and updating these as necessary to reflect changing market and economic conditions

iii) Reviewing self-assessments of all key business functions.

iv) Reviewing all major capital investment decisions and considering the subsequent “Benefits Realisation Reports” to check that the anticipated benefits have been delivered

v) Reviewing benchmarking data.

3. GovernanceThe Trustees of BVT place great emphasis on the delivery of our VFM objectives.



During 2014, Trustees established an Asset Management Steering Group (AMSG), comprising Trustees and senior officers in order to put greater focus on this area.

The core purpose of this group is:

“To undertake regular reviews of the value of the Trust’s assets, not only in financial terms, but also taking into account any moral, social, environmental or political issues which relate to the retention and use, change of use or disposal of those assets.”

In relation to the above, the housing and maintenance teams on the ground contribute greatly to this strategy in their assessment of some of our older homes on the periphery of our estates.

There is no point spending huge sums of money to bring a void property back to a good re-let standard if demand is low.

However, to sell such a home on the open market offers options to first time buyers, and helps create mixed tenure estates which again is part of our ethos.

The AMSG’s remit is to consider all BVT’s assets over a rolling five year period, paying particular attention to those assets that are considered to be peripheral either in terms of the Trust Deed or geographically. BVT’s area of operation has always been within the general West Midlands area and indeed we now only operate in two local authority areas with the following stock numbers as at 31st March 2016

Birmingham 3.070

Borough of Telford & Wrekin 720

During the course of 2016, BVT has focussed on those properties in our core areas of business and have sold five of the ex-TDC properties.

This was more than offset by the acquisition of 12 properties at Lawley, 11 of which were shared ownership properties.

The Trust very much values the contribution our tenants and residents make to our governance structure and their input assists in streamlining procedures and services.

In Shropshire, the Bournville Housing Partnership (BHP) is a board of tenants, Trustees and officers, focusing on the landlord function in Shropshire.

Developed in 2011, this is the first committee within BVT’s governance structure chaired by a tenant. A strong and committed group who get involved in void inspections, post cyclical maintenance inspections and resident engagement.

The findings of this group fed into the void procedure review which has resulted in improved procedures. This group continues to go from strength to strength, strongly supported by Trustees and officers.

Whilst always involved in the budget setting and monitoring process for their area of operation, further training is currently underway to enable them to understand where their budgets sit within the wider organisation and how those budgets impact BVT’s bottom line.

BVT’s Scrutiny Panel also plays an important part in reviewing services to improve service delivery and make efficiencies where appropriate. A recent review was in relation to Resident Insight. This review suggested that BVT needed to adopt a range of different approaches to gaining feedback from residents.

The response rate for our quarterly surveys was too low and we needed to learn from the approaches that other RPs were now adopting. This has led to the Digital First agenda being a key element of the Trust’s latest business plan.

Tenants also have a major say in some of our maintenance procurement decisions.

There are two main examples of this:

• Every year, BVT holds an open day, our ‘Maintenance Exhibition’, where tenants whose properties are part of our planned maintenance programme are invited along to have their say and choice regarding their replacement kitchen/ bathroom etc

• BVT has a Tenant Maintenance Panel that gets involved in the procurement of maintenance contracts which have a real impact on tenants’ homes. Representatives from the panel have been involved in recent years in the selection of contractors in relation to rewiring and kitchen replacement programmes. These representatives were involved in every stage of the procurement process and had a genuine input in terms of the selected contractor.


The Placeshapers group consists of 96 community-based housing associationswhose main focus is serving their traditional communities in very much the same way that BVT does. The results of the latest Housemark report, which is based on our 2015 year end accounts are summarised below.

BVT subscribes to the Housemark benchmarking service and we compare ourselves with the Placeshapers group of registered providers whom we feel are the most appropriate organisations to compare ourselves against.

5. Benchmarking

This shows that in most areas costs are in the upper quartiles of the benchmarking group.

The main exception to that rule is other expenditure. This is higher than our peers because of the extensive non-housing commitment which BVT undertakes.

BVT provides much more than basic housing services. The maintenance of our conservation area, for example, is more costly than a more modern development which is less likely to have our much treasured parks and open spaces for communities to enjoy.

Resource Analysis – how we spend our money

Percentage Quartile

Overheads 15.42% Q1 Major / cyclical maintenance 21.19% Q1 Responsive / void maintenance 14.34% Q1 Housing management 4.53% Q1 Development 1.17% Q3 Estate services 1.95% Q1 Supported housing 1.34% Q2 Other 39.78% Q4

Table 1

We provide a range of community facilities and other services, the main elements of which are:

• Maintenance of 500,000 square metres of communal areas within the Bournville Estate

• Provision of shops and business premises

• Provision of schools, community halls and sports facilities

• Maintenance of 3,000 acres of agricultural land around the southern boundary of Birmingham

• Provision of managing agency services to a number of small housing organisations

• Provision of a nursing / residential care home

• Provision of care for people with learning difficulties.

In terms of the main benchmarks which Housemark publish, this is shown below.

The Business and Financial section shows that costs in all the areas considered by Housemark are lower in 2015 than for 2014.

This indicates that BVT is moving in the right direction, though we also acknowledge that in terms of maintenance costs, are cost per property is higher than most others.


As for the Value section, BVT scores very highly in all of the categories of tenant satisfaction that we measure and we are very keen to maintain this position whilst seeking to reduce costs where we can reasonably do so.

We acknowledge that we have work to do to improve those areas where our performance is not as good as others.

The main areas we have focussed on during the course of 2016 are:

• We have revised our approach for charging work undertaken by our in-house direct labour organisation, Bournville PropertyCare Services, so that all works are now charged in line with the National Housing Federation’s schedule of rates

• We have streamlined the management and administrative functions within Bournville PropertyCare Services, which are estimated to save us £148,000 a year.

• During 2016, we transferred our in-house architectural practice, Bournville Architects to one of the top 10 practices in the country. It was becoming increasingly difficult for Bournville Architects to compete with the larger practices, so Trustees reluctantly agreed to the transfer.

• We have reviewed our processes for dealing with major voids and in doing so have reduced the average re-let time by around three weeks

• We have automated our rent review processes and saved two days of staff time each week as a result.

If we drill into the Housemark report in more detail, we can pick out some of the actual costs of delivering our services.

These are summarised in table 2 below:

Cost per property 2015 (£) Quartile 2014 (£) Quartile

Housing Management 403 Q2 427 Q2 Major/Cyclical maintenance 1,406 Q3 1,433 Q2 Responsive/Void maintenance 995 Q4 1,037 Q4

Table 2

Cost as % of Turnover 2015 (%) Quartile 2014 (%) Quartile

IT 2.30 Q1 2.31 Q1 Finance 1.75 M 1.72 Q2 Office 1.87 Q3 1.92 Q3 Central 5.23 Q2 5.29 Q2

Table 3

This table reflects the greater emphasis now being applied to VFM. Improvements have been made in all the categories here.

However, we recognise that we need to continue to seek further improvements in future years, not least to ensure that

the Trust has a secure financial position despite having to cope with a period of rent reductions over the next few years.

In terms of our overhead costs, an analysis of performance here is shown in table 3 below:

Given that BVT undertakes various functions outside of the main housing management and maintenance sphere, it’s very pleasing that our overhead costs perform comparatively well.

Whilst we acknowledge that many of our peers in the Placeshapers group also undertake services outside of the norm, very few are going to have the

extensive responsibilities that BVT has for estate management, including our agricultural estates, as well as our range of commercial and community facilities. These responsibilities inevitably require a degree of overhead support, so it’s good to see that despite these factors, BVT performs pretty well in terms of its overall overhead costs.


Indeed, were it not for the fact that BVT moved offices in 2013 into a newly refurbished building, which has resulted in an increase in office depreciation, then the position would look even better.

In June 2016, the HCA published their Unit Cost Analysis. This calculated a cost per property in each of the following areas:

• Housing management• Service costs• Routine maintenance• Major repairs• Other costs.

The Unit Cost Analysis was based upon BVT’s costs as reported in our 2014 financial statements, as compared to all other RPs.

The analysis showed that BVT’s housing management costs performed well, but that service costs and routine maintenance costs were very high compared to others.

In terms of service costs, it quickly became evident that the HCA’s calculations included a large element of supported housing expenditure, which if eliminated, significantly reduced the reported figure.

This was due to the way that costs were disclosed in our 2014 financial statements and something we have addressed in our 2016 financial statements.

In terms of routine maintenance costs, and to some degree major repairs costs which were also higher than average, BVT initially commissioned a review by HQN to look into the reasons for this.

The review has identified a number of issues that we need to consider,

including how overheads are apportioned in our financial statements. The HQN review has however confirmed that, compared to other RPs that HQN have worked with, BVT’s maintenance costs in many areas were higher than others.

This has led on to a further review to be undertaken by Ark Consultancy, which seeks to identify the main cost drivers that lie behind these overall numbers as well as looking at what BVT can do to reduce maintenance expenditure, without any significant impact on the high levels of tenant satisfaction that we have always achieved.

The key conclusions from the Ark report are:

• BVT’s stock profile (i.e. greater percentage of houses to flats) would justify maintenance costs being 17.4% higher than the average

• BVT’s beneficial terms and conditions of employment for BPS operatives, explains why our maintenance costs are 6.6% higher than the average

• BVT could be procuring some key maintenance components more cost effectively

• Some cultural change is needed within BVT’s maintenance operations to eliminate duplicated work and to improve efficiency and productivity.

However, the Ark report did point out that some improvements are already underway in this area.

Having said that, perhaps the key driver behind recent asset management reviews has been the location of stock. Trustees are looking to concentrate on our core areas of business which are currently seen to be:

Birmingham

Shropshire

As a result, all of the properties we own in Bromsgrove and Redditch (except for one care home) were transferred to another reputable and more local RP during the course of 2014.

This more local service delivery will improve services to customers, indeed our tenants were involved in the selection of their new landlord including sitting on the interview panel of the final shortlist. The future of the care home will be assessed when the current lease expires in 2017.

Trustees have also instructed officers to look to transfer the residential properties that BVT built in Bordesley Village to another RP and this process is currently in hand.

Return on assets is not only considered from a financial viewpoint, it also considers social, environmental, moral and political factors.

In terms of the Bournville Estate, for example, there is a very strong moral perspective to retain the assets that remain a key principle of George Cadbury’s legacy.

Bournville holds a special place within the Garden City movement - a movement that seems to be coming back into fashion. Trustees therefore regard Bournville as ‘the family silver’, not to be sold unless no other option exists.

This includes our commercial portfolio of shops, offices and other facilities that help to make Bournville a village, rather than just another housing estate.

This ethos, created by George Cadbury, has been extended to our new developments today and is what sets BVT aside from many RP’s.

Our new Lightmoor community in Telford enjoy not only their new homes, but also an extra care scheme, shops, a school, community centre and much green space, not to mention the village centre, a key characteristic of a BVT estate.

The Trust’s agricultural estates need to be considered primarily from an environmental perspective. These estates were gifted to BVT as green belt land, providing vital farmland and amenity space to the residents of Birmingham and other neighbourhoods.

6. Return on AssetsIn undertaking their review of BVT’s various assets, the Asset Management Steering Group (AMSG) considers the return on each asset, or group of assets, that it reviews.


These figures are calculated by dividing the surplus for the financial year in question for each class of asset, by the net book value for those assets as at the end of the financial year.

However, the returns for 2016 have had to adjust for some depreciation amendments made that year for overcharges in previous years on structural additions.

The relatively low level of return on agricultural assets reflects the fact that, for some considerable time, there was a lack of a proper investment programme.

This has been addressed and over recent years, BVT has been spending a good deal on bringing our agricultural buildings up to a modern standard.

Much of this investment has been funded from the sales of land and buildings on the agricultural estate. Over the last four

financial years, just under £1.1 million has been generated from such sales.

Returns for commercial properties have been deteriorating in recent years. This reflects the general economic downturn and the fact that we have to let shops on lower rents (or even on a rent free basis in some cases) in order to attract new business to the areas in which we operate.

Whilst Trustees recognise that managing agricultural estates cannot be considered as part of our core business, there is equally an understanding that such land has been gifted to us on the understanding that BVT would help to protect it as green belt land.

This is not to say that Trustees are unwilling to consider any development on the agricultural estates. Indeed, Trustees have asked officers to undertake feasibility studies on four small

development opportunities at various locations within our agricultural estates.

Equally, there are a small number of residential properties on the agricultural estates and Trustees have approved the sale of such properties over time when the cost of refurbishment has been excessive.

Looking at return on assets from a purely financial perspective over the last few years, this is summarised in the table below:

Return on Assets

Asset Class 2013 2014 2015 2016

Housing 3.49% 3.83% 3.95% 4.97%

Agriculture 1.12% 3.88% 2.08% 3.08%

Commercial 4.86% 4.51% 4.37% 6.42%

Overall return 3.49% 3.85% 3.92% 4.98%

Table 4

This is particularly the case in Lightmoor where we have four new commercial units and have had to agree low rents or even rent-free periods to attract appropriate businesses when the village is still under construction. The improvement in returns for 2016 is because of additional income from rent reviews and lower maintenance expenditure.

It is likely that returns on housing assets are going to be lower in future as a result of the imposition of a 1% rent reduction for most of our housing properties, commencing from April 2016 and continuing through to at least 2019.

The impact for BVT was lower in 2016 due to the fact that BVT applies rent increases on the anniversary date of each individual tenancy. Furthermore, significant savings in maintenance expenditure have resulted in a marked increase on the returns achieved for 2016.

In terms of environmental considerations, in 2007 BVT completed the refurbishment of a property originally built in 1929. The refurbishment was done to ECO Homes Excellent Standard and the project won the Sustainable Housing Award from the Chartered Institute of Housing.

The refurbishment involved a range of environmental technologies and has subsequently helped BVT to identify the factors that had the most environmental impact for the associated cost. This has helped to inform BVT’s planned maintenance programme ever since.

All new boilers and windows fitted through our planned maintenance programme are ‘A-rated’. All major voids make full use of recycled bricks and timber. All communal lighting is now provided through LED lighting and all green waste is fully recycled.


These are activities, services and/or facilities that BVT has provided for many years as part of George Cadbury’s ethos for a garden village, but they also include services that we have developed more recently where Trustees feel the need to fill the void created by a lack of government funding.

These are a key element of our strategy.

Our founder’s success in building strong communities continues today. The Community Services team work with colleagues from across the Trust to help our communities flourish.

This of course impacts on our management cost and in part we understand why we are not top performers in this area. Nonetheless, we do not allow this to ‘mask’ the scope for any efficiencies that could be achieved through scrutinising our services further.

During the course of 2014, BVT commissioned Baker Tilly to undertake a Social Impact Review of six of these service areas. Baker Tilly were chosen because they had developed an approach to assessing social impact that was both robust and comprehensive.

Staff from Baker Tilly worked alongside our own staff in undertaking the review to assess the full impact of the six service areas. The full Baker Tilly report is available on the BVT website, but in summary they evaluated the social value of the six service areas as follows:

Table 5

Anti-Poverty/ Welfare Support £1,493,574Selly Manor Museum £800,223Community Halls £1,077,898Community Support £453,042Home Support £471,627Equipment & Adaptations £1,049,158

Total Social Value £5,345,522

At the time of the review, BVT spent around £750,000 each year providing these activities, services and/or facilities. It is therefore quite remarkable that the social returns on this investment is around 600% per year.

However, with the need to make efficiencies, the budget out-turn for 2016 will see a reduction of some £160,000 compared with this figure. Teams no longer view Value for Money as a process to be applied, but as a way of working within the BVT culture.

To give an example of savings achieved, the Home Support scheme referred to above was set up and run by BVT for the benefit of the community. The ‘House Keepers’ employed have now been trained by a social enterprise with whom we partner to enable them to become self-employed. This removes the cost to BVT, enables the ‘House Keepers’ to earn a higher income and retains the service within the community.

7. Social Impact ReviewThere are some areas of our business which do cost BVT money each year, but that Trustees feel are important.

Trustees and officers strongly feel that BVT’s role is to enable and facilitate in addition to direct service delivery. This empowers communities and helps them build capacity.

The review covered six areas of our business, but BVT undertakes other services for the benefit of our residents which we may look to value in the future.

But this review clearly demonstrates the true value of what BVT does for not only our own residents, but the wider community.

In 2017, plans to undertake some further social impact reviews, covering the following areas of activity:

• Our homes for people with learning difficulties

• Anti-social behaviour

• Support for our local schools• Bournville Almshouse Trust• Support for resident and tenant

associations• Community fund.

The results from these reviews will be included in our 2017 VFM Self-Assessment.


A. Gas contract

In April 2016, BVT re-tendered its gas contract, which picks up all the major supplies that we have. We decided to tender through two separate brokers and this resulted in a saving of £61,500 compared to our previous gas contract.

B. Telephone contract

When we moved all of our Bournville offices to 350 Bournville Lane in 2013, we also changed our telephone supplier. In 2016, when the contract with the new supplier was coming to an end, we negotiated a new contract and in doing so, secured savings of £56,000 over the next three years on the contract.

C. Community halls and activities

One of the areas that came into focus as a result of the work done on savings, in the area of resident involvement, we have improved our position substantially:

BVT owns and/or manages five community halls, all have different operating models and in 2015 we passed operational responsibility of one of our

halls, Woodlands Park, to the main hirer, a child care provider. This has reduced costs to BVT whilst retaining the facility within the community. It also gives the hirer more capacity to expand the range of services on offer.

Another of our halls, Phoenix Hall, owned by Birmingham City Council but managed by BVT, has operated at a loss for a number of years, whilst offering a great service to the community. In 2016, BVT withdrew from this management arrangement and has been working with the local community to empower them to deliver services themselves. This will deliver an efficiency of circa £60,000 per annum.

8. Specific Examples of Efficiency SavingsWhen considering the improvements in our costs through the benchmarking data (as stated in paragraph six, table 2), detailed below are some specific examples that helped to achieve those efficiencies.

The community team work alongside our residents, partner organisations and schools to make best use of volunteering opportunities to encourage resident involvement and also save money. In 2016, we saved over £13,000 through using these networks.

As a result of a comprehensive review of this function, costs have been reduced by over £120,000 a year, whilst still maintaining a strong ethos for community involvement which is at the heart of BVT’s core purpose. D. Doing it ourselves

Staff are now encouraged to consider

opportunities for dealing with tasks and/or projects in-house rather than employing an external consultant or provider.

Some examples of the savings that have been achieved in 2016 from this are:

• Developing our own Asset and Liability Register (estimated saving - £30,000)

• Developing our own Health and Safety documentation for Construction, Design and Management (CDM) regulations (estimated saving - £14,000)

• Developing a system of KPI reporting in-house (estimated saving - £10,000)

• Configuration of our upgraded


Document Management and Workflow software without the need for consultancy support (estimated saving - £10,000)

• Using our in-house landscaping service to undertake a maintenance service that was previously contracted out (saving - £9,000)

• Representing ourselves at court in rent arrears cases rather than use external solicitors (estimated saving £7,000).

E. Generating Additional Income

We have looked to generate some additional forms of income wherever possible.

Some examples of this for 2016 are:

• Charging solicitors for our costs in dealing with their queries in relation to sales of owner-occupied properties (income of £13,465 achieved)

• Generating contributions from local residents for replacing the lights on Bournville’s famous Christmas tree (income of £8,800 achieved)

• More proactively seeking grant funding wherever we can (grants of £40,000 received).

F. Welfare Benefit Reforms

In response to the Welfare Benefit Reforms, BVT has invested in resources to support customers and protect our income, the result of which has been very positive.

Whilst at the time of setting the budget a realistic approach has been taken, the team will, whenever possible look to integrate that support into existing roles, work jointly with other RPs to share best practice and avoid duplication and ensure welfare reform is planned for and challenges anticipated.

Working in this way, the team saved £46,000 during 2016 compared with the available budget. Furthermore, BVT successfully negotiated Discretionary Housing Benefit payments of over £100,000 in the year ended 31st March 2016, helping our tenants to cope with the welfare benefit changes.

G. Supported Housing

In 2016, we have seen significant improvements in the financial performance of our various supported housing activities.

BVT provides a range of supported housing services, namely:

• Three sheltered schemes for the elderly who are able to live largely independently

• Two homes for people with learning difficulties

• Two extra care schemes• One residential / nursing care home• One almshouse scheme.

These services have generated an extra surplus of just over £200,000 compared to 2015. This has been achieved by removing two senior posts and improving the efficiency of the various schemes.

H. Routine Maintenance

In 2016, we introduced several changes to the way we process routine repairs. These included a move to the NHF Schedule of Rates system as well as control of such orders being transferred to the Asset Management team. In addition, restructuring within our BPS team was completed. The outcome of these changes was an overall saving of £450,000 in routine maintenance expenditure compared with 2015.

9. Looking AheadBVT’s VFM Strategy states that where costs are higher than average, officers are required to investigate the reasons behind this, and to set out in detail:

• Suggestions for cost savings that can be made without significant adverse impact on quality of service

• Reasons why costs will be higher than others due to factors outside officers’ control.

The strategy recognises that there may be legitimate reasons why our costs are higher than the average of our peer group, particularly if, as a result, we achieve higher levels of tenant satisfaction.

But it also recognises that there is usually some scope for efficiency savings and officers need to look closely at what can be done to realise such savings.

The imposition of a 1% reduction in our main housing rental income from April 2016, has resulted in BVT, along with all other registered providers, having to look at areas where cost savings can be made. Some examples of cost savings built into our 2017 budget / business plan are set out below.


10.ConclusionThis statement sets out BVT’s approach in delivering value for money.

Trustees and officers recognise that a lot of work has been undertaken to improve VFM in recent years, but that there is still more to be done.

Applying value for money principles and striving for efficiencies is now a way of life, it’s our culture rather than a process to be applied.

Like all businesses, we need to look at what we do and how we do it, taking into account the changing environment we have to deal with.

The journey continues.

1. We changed our insurance broker during the course of 2016. The new broker has secured a saving of £107,000 in our insurance premium for 2017, whilst ensuring that the level of cover remains at the same level.

2. As a result of the various measures already taken to reduce our maintenance costs, we anticipate that our total maintenance expenditure for 2017 will be some £196,000 lower than the 2016 budget. This would have been significantly higher but for the decision to increase the budget for our window replacement programme by £250,000 in 2017.

3. As a result of decisions already made, our total wages and salaries budget for 2017 is estimated to be £100,000 lower than it was for 2016.

4. We plan to make savings through our Digital First agenda. The first example of this is that we shall be printing off fewer copies of our Annual Report this year and relying on our residents to access this via our website. As a result, we have reduced our communications budget by £10,000. Further savings are anticipated in future years.

Bournville Village Trust, 350 Bournville Lane, Bournville, Birmingham, B30 1QY

Tel: 0300 333 6540 Fax: 0121 667 5916 Email: [email protected]

www.bvt.org.ukTwitter: @BVTnewsFacebook: Bournville.Village.Trust

Value for Money - Bournville Village Trust · ii) Value for Money iii) Rent iv) Tenant Involvement and Empowerment v) Home vi) Neighbourhood and Community vii) Tenancy. This document

Documents