Staff working for Nottingham City Homes are understood to be "very nervous" about losing their jobs as the city council seeks to bring the housing provider back under its full control. The decision to cancel its contract comes after a series of misspends, some already deemed 'unlawful', were uncovered.
Towards the end of last year it was discovered just under £15m had been wrongly and unlawfully transferred from Nottingham City Council's Housing Revenue Account (HRA) to its general fund. The money was intended for council tenants and their homes, but it was instead used to financially support other council services amid financial constraints.
Evidence of these misspends dates back to 2014/15, but payments beginning in the 1990s are also being investigated. The council commissioned two independent reviews which have uncovered even more misspends up to £40m, with cash said to have been used on non-HRA activities despite it being ringfenced.
Read more: Questions raised over payments dating back to 1990s at city council
Of this total £17.1m is understood to have been potentially misspent by the council's arms-length housing provider, Nottingham City Homes (NCH). NCH however denies such claims.
As a result of the issues the council served NCH a 12-month notice to terminate the contract and bring it in-house. This was just recently done with EnviroEnergy, but the news has rightly proved a cause for concern for staff members, of which there are currently 1,021.
Councillor Mellen, the leader of the council who represents the Dales ward, said: "It is very important that we reassure both the tenants and the staff members. I was with an officer of Nottingham City Homes in my previous meeting and he was saying some staff are very nervous about that and is that going to cause people to worry about their jobs.
"It might cause people to worry but we are trying to reassure them that what we want to do is a lift and shift. We haven't got the skills within the council now that we had 20 years ago to run a housing function, we need those staff members to move across, so there won't be people losing their jobs."
The process of bringing NCH in-house has already begun. Councillor Mellen says this will bring the council back in-line with what is happening nationally as arms-length management organisations (ALMOs) are brought back in-house.
There were at one stage 75 ALMOs around the country, however now there are only roughly 20 left. They were set up, like NCH, as a way of accessing additional resources.
Tenants must also be reassured, he says. Councillor Mellen added: "Equally we need to reassure tenants that this is not going to be something that will cause them to be anxious, because in reality the same people will be doing their repairs, the same patch managers will be there, the same independent supporters in sheltered accommodation will still be there."
As called for by Conservative Clifton West councillor, Andrew Rule, all transactions involving the HRA going forward must be signed off by the section 151 officer in the council. This is currently Clive Heaphy, also the director of finance, who first discovered the unlawful payments back in 2021.
