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Welsh housing associations returned to private sector
Welsh housing associations have been officially reclassified as part of the private sector, following deregulation measures.
The Office for National Statistics (ONS) today announced housing associations in Wales would be removed from the public sector balance sheet, following their reclassification as part of the public sector in 2016.
Deregulation measures were passed through the Welsh Assembly in May, and the ONS formally concluded its reassessment and announced its decision today.
Housing associations in England were classified as public bodies in 2015, with associations in the rest of the UK following a year afterwards.
The ONS based its decision on the level of control granted to government through the system of regulation, sparking deregulatory measures to reverse the issue.
The reclassification, while a technical matter of accountancy, did see housing associations’ billions of pounds of debt placed onto national balance sheets – sparking fears governments would limit association borrowing in order to keep overall deficit figures down.
However, Westminster, Holyrood and Cardiff all responded with prompt deregulation to reverse the decision.
English housing associations’ were reclassified back into the private sector last year.
In a letter to the Welsh Government sent yesterday, the ONS left open the possibility to reclassify individual associations as public should the level of state control increase.
It said: “So that ONS can continue to ensure the correct classification, we would request that ONS is notified if there are any changes in circumstances that could affect this classification decision.
“This would include instances where the Welsh Government makes use of its continuing power to appoint managers or officers to [housing associations] in Wales, if the Welsh Government becomes aware of any [housing association] where public sector board membership (or shareholding) is above 25%, or if material additional information comes to light that suggests the sample of allocations partnerships provided to ONS is not representative.
“As such, ONS retains the right to review the classification of [housing associations] confirmed in this letter or the classification status of individual [housing associations].”
