Structure of the Act Part 2 – Regulation of Social Housing Relationship with other bodies Section 106 - Direction to the HCA
208.This section gives the regulator a power to direct the HCA not to give financial assistance to a specified registered provider. The regulator’s direction may only be made in respect of the HCA’s power to give financial assistance under section 19 in connection with social housing.
209.The purpose of this power is to prevent financial assistance from being given to a registered provider where there are serious concerns about mismanagement or about the viability of the organisation. This power may be used in the most serious interventions by the regulator, as described in subsection (2):
	the regulator has decided to hold an inquiry into affairs of the registered provider under section 206 (and the inquiry is not concluded),
	the regulator has received notice in respect of the registered provider under section 145 (moratorium), or
	the regulator has appointed an officer of the registered provider under section 269 (and the person appointed has not vacated office).
210.Subsection (3) states that a direction may prohibit the HCA from giving assistance of a specified kind (whether or not in pursuance of a decision already taken and communicated to the registered provider). This means that the regulator could prohibit some forms of financial assistance while allowing others. It also means that the regulator could prohibit financial assistance even where, for example, a funding agreement is already in place.
211.Subsection (4) prevents the regulator from issuing a direction prohibiting grant to a registered provider where that grant is to be given in respect of discounts given by the provider on disposals of dwellings to tenants. This ensures that the regulator’s powers do not interfere with the HCA’s statutory duty to pay grants under section 35 (duty to give financial assistance in connection with certain disposals).
212.Subsection (5) states that a direction shall have effect until withdrawn.