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Delivering value for money

Achieving value for money and continuous improvement remains a fundamental business strategy for L&Q and we have strengthened and deepened our approach since last year.

In 2015/16 we generated a net surplus of £274 million, up from £215 million in the previous year. It is key to L&Q's aims that we continue to generate significant surpluses for reinvestment. We can now use our expertise in housing to maximise our business and find ways to fund our social mission ourselves. We acknowledge that we need to continue working hard to improve resident satisfaction and innovate so that we can achieve more for our customers.

How we deliver value for money

We have integrated our approach to achieving value for money into all that we do.

  • Governance - Our board members review the efficiency of our work and make sure that we comply with industry standards on value for money. We also encourage staff to question how we operate to find ways of providing a better and more efficient service
  • Financial - Our budget and business plans include targets for making efficiency gains and improvements to services each year. Each department also works to improve how it buys goods and services and looks for new ways to work with partners so that we provide real value for money
  • Our assets - Increasing our understanding of the performance of our assets and taking steps to improve their performance
  • Managing performance - We review our performance continuously and check how we compare to other large housing associations. We aim to remain among the best for financial strength and quality of services. To do this, our senior staff review the costs of our activities and identify how we can improve services
  • Resident focus - We are committed to making sure that residents receive value for money from their rent and service charges. We involve residents in our decision making and our board and senior staff monitor resident satisfaction levels regularly
  • Planning process - Our yearly business planning process aims to achieve the best service to residents at the most efficient cost, and to generate enough surplus to enable us to invest in improving services and growing responsibly
  • Our people - We are committed to investing in our staff and rewarding outstanding performance to improve resident satisfaction and financial strength

Our success in 2015/16

  • Delivered more than 2,500 new homes, more than half of which are for sub-market rent or affordable home ownership
  • Exceeded our sales targets, selling more than 986 new homes, including homes for outright and shared ownership
  • We nearly tripled our development pipeline to 39,800 homes
  • Achieved financial and wellbeing gains for our residents worth more than £36 million through our community investment work
  • Achieved 79% overall resident satisfaction in 2015/16, with low management costs
  • Cut our rent arrears to 3.3% our lowest-ever level and down from 3.4% last year
  • Expanded the use of our in-house building service, Quadrant Construction, which has saved us around £13 million in VAT
  • Continued to roll out our in-house Direct Maintenance services to residents, saving us £2 million in VAT while providing a better service at a lower cost
  • We helped nearly 440 people into paid work and directly helped residents to boost their incomes by £8 million

Increasing value for money in the future

We have firm plans to improve value for money in the future. Our corporate plan for 2016/20 as a whole seeks to achieve value for money. The key targets for the coming year are:
  • Achieving satisfaction of 80% or more with three core measures: quality of home, repairs and with L&Q overall
  • Delivering at least 1,000 below market rent homes and handing over 2,500 units overall
  • Achieving a minimum cash operating margin for social housing lettings of 47%
  • Achieving a budgeted operating cost per unit of £3,090
  • Achieving a positive rating of 76% or above on empowerment and accountability in the Great Places to Work survey

This is the strategic plan for L&Q as a standalone organisation. In April 2016, L&Q, Hyde and East Thames announced their intention to merge. This merger is directly concerned with creating more value. Through the proposed merger the new group believes it will be able to deliver an additional £50 million of cost synergies over and above those planned by the standalone entities. It will be able to increase its output to 100,000 homes in ten years, 50% of which will be affordable tenures.

Related documents

You can find further information on how we provide value for money in the following documents: