Housing associations are to have their efficiency scrutinised in the wake of a government review of the Housing Corporation.
A unit is to be established at the corporation to assess how housing associations perform in comparison with local authorities. An efficiency index for carrying out the assessments is still to be developed.

The focus on efficiency is one of the priorities of the action plan for the corporation announced by the Office of the Deputy Prime Minister last week. The unit will be headed by Bob Dinwiddy, the corporation's assistant chief executive in charge of regulation and best value.

John Barker, chief executive of Moat Housing Group, said of the idea for an efficiency index: "We need to counter misconceptions that the differences in operating costs between housing associations is a result of inefficiency, rather than a reflection of the very different jobs that they do. If an efficiency index can help to achieve this, then it will be welcome."

The National Housing Federation said that the regulatory focus on efficiency ought to be accompanied by a reduction in rules governing housing associations in other areas.

Under the action plan, the Housing Corporation is to have a greater involvement in the Office of the Deputy Prime Minister's policy-making process.

Last week, the corporation announced a reorganisation of its management structure.