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Leathermarket JMB could get self-financing status

Southwark's largest tenant management organisation, which looks after 1,500 homes in SE1, could soon keep control of the rents it collects on behalf of Southwark Council under proposals endorsed by the borough's cabinet this week.

"This is groundbreaking stuff," explained Martin Green, Southwark's head of home ownership, as he introduced the plans at Tuesday's cabinet meeting.

"This is the first time this has ever been done in the country."

He added: "We've thought long and hard about the proposals but I think it shows a commitment to working in conjunction with local people for service delivery.

He praised the Leathermarket JMB for its "16-year record of very good governance".

The JMB, which is one of the country's largest tenant management organisations (TMO), last year won 92 per cent support in a ballot of tenants and leaseholders for the continuation of the devolved management of council-owned estates in Bermondsey for another five years.

"The normal situation across the country is that ... the TMOs will collect the rent and the service charges, send it to us and we will pay them for the services they provide," he said.

"TMOs can choose which services they provide. Leathermarket chooses to provide the whole gamut of services, including the delivery of major works.

"The TMO have come to us and said ... let's change it round so we collect and keep the rent and service charges, and we'll pay you for central services.

"I've got to say that it looks like in the first two years Leathermarket will be financially worse off – but they are prepared to swap that short-term loss for long-term certainty.

"They can take part in all the decision-making that we make on a strategic level.

"I think that they deserve that. They've got satisfaction levels that we would aspire to in their service delivery and I think there's a need to reward that level of commitment and local involvement."

The plan will require the approval of communities and local government secretary Eric Pickles.

"Initial indications from senior civil servants are that they are very excited about this and may follow it up with some legislation themselves," said Mr Green.

Cllr Richard Livingstone, cabinet member for resources, described the move to self-financing at Leathermarket JMB as "the single most significant act of devolution of power that this council has ever exercised".

He added: "This does really put Southwark at the cutting edge of how we are dealing with tenant management organisations and I think it's a process that's very much to be welcomed."

In a good-natured dig at neighbouring Lambeth Council, Southwark's council leader Peter John said: "Others might talk about cooperative and mutual solutions, but we actually do it here."

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