The social housing watchdog plans to cut its running costs by about 10% next year (2010-11), while doubling its remit when it takes on responsibility for regulating local authorities.

The Tenant Services Authority (TSA) will reduce its budget to £35m – down from £38.5m this year. The TSA has already identified £2m in savings during its first year by reducing information technology and legal costs and by sharing office space with other Government agencies.

But the full extent of efficiencies stretches further than this. Within its reduced budget, the TSA also intends to fund the £1.8m programme to inspect housing associations – costs that the Audit Commission met in the past.

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The TSA currently regulates housing associations with two million social housing homes. From 1 April, the TSA will also become responsible for regulating local authorities and arm’s-length management organisations who combined own two million homes.

Chairman Anthony Mayer said: "The next few years are going to be tight financially across central and local government, and there's a renewed and welcome focus on the need to control public spending and deliver value for taxpayers' money.

"We have already made clear our plans to reduce red tape in the social housing sector. We will deploy our people where they can make the biggest difference. For 2010-11 we will focus our work on supporting those organisations with the greatest performance challenges – working with landlords to deliver a fair deal for their tenants.

"We are leading by example by demonstrating value for money in the social housing sector for the taxpayer and Government."

(CD/GK)