"Independent and effective regulation is crucial in safeguarding this lender investment and in encouraging firms to continue to fund the sector."
The CML says its members have so far provided more than £60bn in finance for the social and affordable housing sector and that "independent and effective regulation is crucial in safeguarding this lender investment and in encouraging firms to continue to fund the sector".
In a statement, the Council says it therefore welcomed the decision, confirmed last November in the Tailored Review of the Homes and Communities Agency, that the Department for Communities and Local Government was in favour of establishing a regulator separate from the Homes and Communities Agency.
The CML continued: "While we are not technical experts on this legislative process, we support regulation that is independent from government funding of housing associations, and from land transactions affecting them.
"The proposal to separate the regulator from the HCA and establish it as a stand-alone non-departmental public body would be consistent with the principles of better regulation."
"The funding of social and affordable housing is becoming increasingly complex, which reinforces the case for a regulatory body that is clearly independent".
Another proposal included no reform but increased fees, beginning in April. The CML says that while this would make it more financially independent from the government, it would "leave the regulator and the government structurally bound together".
The CML concluded: "An independent regulator could establish its own governance arrangements, and set out how it would be accountable. This would strengthen it as a regulatory authority, and reinforce the confidence of lenders and others."
