PI's: Cost Per Unit
Regulator for Social Housing: Cost Per Unit
RSH 501: Headline social housing cost per unit
Rationale, Definition & Worked Example
Below you can find information regarding the rationale, definition and formula for this performance indicator. This includes a worked example to demonstrate how this indicator should be calculated.
Rationale
This is the measure used by the RSH in its the regression analysis of providers costs. The regression analysis findings can also be used to inform the narrative.
A split of the headline social cost per unit into components, or adjusted unit costs can be used to support the narrative. Providers with a large supported housing provision may wish to present the headline unit cost split by general needs and supported housing.
The regulator recognises that higher costs may reflect a conscious choice to invest in an area with greater social value.
Definition
Formula
(A / B) x 100
A = Social housing costs
B = Social housing units
“Social housing costs” = [Management costs
+ Service charge costs
+ Routine maintenance costs
+ Planned maintenance costs
+ Major repairs expenditure
+ Lease Costs
+ Capitalised major repairs expenditure for period
+ Other (social housing letting) costs
+ Development services
+ Community / neighbourhood services
+ Other social housing activities: Other (operating expenditure)
+ Charges for support services (operating expenditure)]
NB. Use actual expenditure rather than £000s in this and all related cost per unit measures.
“Social housing units ” = Total social housing units owned and/ or managed at period end
Affordable Rent), Affordable Rent supported housing and housing for older people, Low Cost Home Ownership, care homes, other social housing units)
Notes:
Leasehold units, which, for example, include Right to Buy and fully stair-cased shared ownership units where the provider retains the freehold, are excluded from this definition of “Closing social housing units managed”.
Accounting Direction 2015 requires material items of social housing activity to be separately identified. Since the regulator published the Headline social housing cost per unit definition, the Other social housing activities – Other line included within the measurement has been disaggregated. This will enable stakeholders to distinguish costs incurred for activities such as Development services and Community services while maintaining a comparable headline social housing cost.
Worked Example
Total social housing costs = £6,000,000
Total social housing units = 1,000
Calculation:
£6,000,000 ÷ 1,000 = £6,000