The two parties had been engaging since November 2016 when a tenant’s representative raised concerns with the Regulator about two gas leaks following the implementation of a contract with E.ON.

Thistle was then the subject of regular engagement during 2017/18 regarding serious delays and difficulties in managing a substantial contract, its governance capacity, risk management and its communications with service users and stakeholders. The Regulator had also engaged around weaknesses in Thistle’s approach to complaints handling.

A manager and five statutory management committee members were appointed to the Association in August 2018 after an independent review identified failures to meet regulatory standards of governance and financial management.

This intervention was appealed by the Association in November 2018 but the decision was upheld by an appeal panel the following month.

In a revised engagement plan for Thistle published this week, the Scottish Housing Regulator said it has established further instances of the Association’s failure to comply with Regulatory Standards and requirements since the intervention.

The “serious and historic failures or potential failures” were found to arise in health & safety, financial health, governance & board skills, asset management and a failure to provide accurate information to the Regulator.

On Thistle’s failure to manage a major investment contract, the Regulator’s engagement plan stated: “In April 2019, after tiles had fallen from the roofs of two different properties, we required Thistle, as an immediate priority, to establish whether work carried out under the contract had been completed to an acceptable standard. An independent survey subsequently identified incorrect fitting of roof tiles in 34 of 35 instances examined.

“Thistle has carried out remedial work to the immediately dangerous areas and we are seeking assurance that the remedial work has been completed to an appropriate standard.  Thistle is considering how it will complete the remaining work identified. A further phase of the survey is due to report at the end of August on the render work in the investment contract.”

With support from the statutory manager, Thistle has commissioned an independent investigation into its management of the contract which is expected to report in October 2019.

On the Association’s management of asbestos and legionella, the report added: “In June 2019 we established that Thistle had provided inaccurate information about its management of asbestos to tenants and residents and to ourselves. We required Thistle to immediately independently review the quality of its asbestos management systems. The governing body extended the scope of the review to include Thistle’s management of Legionella.

“Our assessment is that there are potentially serious weaknesses in and failures in Thistle’s approach.

“The statutory manager has instructed surveys and air tests of the properties affected and Thistle will report the results of these to us and to tenants and residents as soon as possible.

“In view of the seriousness of these matters, with support from the statutory manager, Thistle immediately commissioned expert independent reviews into its compliance arrangements for asbestos, electrical, fire, gas, lift and water safety. Thistle will report the results of these to us as soon as possible.”

The Health and Safety Executive said it is aware of the asbestos issue and is “currently investigating”.

It was also found that Thistle had not carried out employer health and safety reports in six years.

The report added that Thistle has now informed the Regulator that the remedial work required to the roof installations completed under the major works investment contract will “incur significant costs additional to its planned investment”.

“Thistle had previously provided incorrect information to tenants, residents and ourselves that there would be no additional cost as a result of remedial work on the contract. So this additional cost is not currently provided for in Thistle’s business plan,” the report said.

The Scottish Housing Regulator concluded: “Thistle has not yet demonstrated sufficient evidence of change and progress in addressing the underlying issues behind its failure to comply with Regulatory Standards. It is dependent on the support from the statutory appointees to maintain effective governance. Further potentially serious compliance failures have been identified by the work of the statutory manager and the governing body appointees.

“Thistle requires strong governance and leadership to deal with the range of complex and serious issues it is facing. As the reduction in governing body member numbers present a risk to the governing body’s capacity we have decided to increase the number of appointees on the governing body to nine to support Thistle to deal with the range of complex and serious issues it is facing.”

A spokesman for Thistle Housing Association told Scottish Housing News: “Thistle continues to work closely with the SHR to address the areas highlighted in the updated engagement plan, with work already under way as outlined within the report.”