星空传媒

In some cases, the response was very much that 鈥淸insert name of housing provider here] is different and really doesn鈥檛 need to be bothered by such matters鈥�.

It reminded me of many years of discussion at housing association board meetings, when the inter-company comparison data for groups of associations appeared.

In those pre-inflationary days, it was the figures for the G6, the precursor to the G15 group of London associations.

Whenever a particular comparison looked favourable, management would nod sagely and pay tribute to their excellent teams.

But whenever the numbers placed the organisation towards the bottom of the pile there was either a data problem or the fantastic quality of the service was being ignored. I exaggerate 鈥� slightly 鈥� but you know what I mean.

A few points do need to be made about the current approach and where it is heading.

First, this is very much a starting point and should not be seen as the final stage of anything.

I had hoped that the language of the discussion document would make this clear and it was a shame, although probably inevitable, that so much of the early comment focused on the rank order.

To me, it was much more interesting that this approach actually removed some of the apparent cost differentials between organisations and provided a more sophisticated basis for the examination of costs and outputs than we鈥檇 ever had before.

Second, this approach is not going to go away. We shall certainly improve it, and where there are errors we should be doing all we can to remove them, but no one has yet come up with any criticism that seriously devalues the methodology.

We do need to find ways both to improve efficiency and also to demonstrate it to the outside world. The index is just one tool in what I hope will become a rather more sophisticated armoury.

The way for organisations to use it is not to apply a couple of adjustments and then explain to their boards that they should really be 30 places higher up the league table.

This approach is not going to go away; no one has yet come up with any criticism that seriously devalues the methodology

What they should be doing is looking at similar organisations that appear to be able to operate with a lower cost base, and asking why the difference is there.

For the corporation, it will be a part of any regulatory assessment 鈥� but not, by any means, the whole picture.

There are going to be some housing associations that score highly in the index but that do not deliver acceptable performance in other areas.

Likewise, there will be organisations doing inherently difficult things well, but which have high costs for good reasons.

We shall have to be able to ask the right questions to discriminate between them, as will boards.

The final point that I would add is that we do need to get constructive reaction from associations in order to improve the usefulness of the approach.

My own personal take is that it would probably make things clearer if we called it a cost index of some sort, rather than an efficiency index. Economists will tell you that efficiency is about the ratio of inputs to measured outputs and treating units as the output without any quality measure is probably not helpful.

What we are not going to do is to let the idea be kicked into the long grass while the debate goes on.

We have to start somewhere and this looks a good place to me.

Think of the index as an iceberg. What you can see is only a small part of the whole approach 鈥� but ignore it at your peril.