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11.08.16

Right to Buy needs ‘urgent reform’ as council replacements lag behind

The current Right to Buy (RTB) scheme needs “urgent reform” as councils are growing increasingly unable to replace homes sold under the programme – with the number of replaced houses falling by more than a quarter last year due to tight national restrictions, the LGA has warned.

The association blamed “complex rules” for a hampered local ability to build enough homes to replace those sold under the scheme, ensuring it sticks to its ‘one-for-one’ replacement policy.

Latest figures released by the LGA showed over 12,000 council homes were sold under the scheme in 2015-16 in England, but just 2,055 replacements were started by councils, symbolising a 27% drop on the year before.

Local authorities now predict that around 66,000 council homes will be sold to tenants under the existing scheme by the end of the decade, despite fears that they will be unable to replace the majority of these.

This would therefore serve to exacerbate the so-called housing crisis, in turn increasing homelessness and housing benefit spending at a crucial time where 1.4 million people are still on council housing waiting lists.

Cllr Nick Forbes, LGA’s senior vice chair, argued the RTB scheme will “quickly become a thing of the past” in England if councils continue to be “prevented from building new homes”.

“Housing reforms that reduce rents and force councils to sell homes will make building new properties and replacing those sold even more difficult. Such a loss in social housing risks pushing more people into the more expensive private rented sector, increasing homelessness and housing benefit spending,” he added.

“If we are to stand a real chance of solving our housing crisis, councils need the funding and powers to replace any homes sold under RTB quickly and reinvest in building more of the genuine affordable homes our communities desperately need.”

As well as the ability to borrow in order to invest in housing, Cllr Forbes repeated calls for allowing councils to retain 100% of sales receipts – combining those receipts with other funding to build replacements and set RTB discounts locally.

“Scotland has scrapped RTB, and Wales is looking at doing the same,” he continued. “Councils in England believe this policy can be made to work if they are able to build the replacements that protect essential local housing, and ensure future generations can also benefit from the scheme.”

The association called on central government to fund the extension of RTB policy by working alongside councils to build more homes on surplus public land. It also once again criticised the forced sale of high-value council homes – which was a major sticking point in the Housing Act during its readings in Parliament – and asked that the policy be made voluntary.

Today’s calls for urgent reforms follow similar demands from district councils last year, with their representative body asking former communities secretary Greg Clark MP to change “conflicting” housing policies after figures showed only one in eight properties sold under RTB were replaced in the previous three years.

Criticisms against the RTB scheme are also far from new, with both the Public Accounts Committee and the Communities and Local Government Committee arguing that the programme’s extension is “entirely speculative” and unclear, as well as lacking in “robust funding and long-term planning”.

But the DCLG reiterated today that the government is committed to building the necessary replacement homes, but issued warnings that if councils fail to deliver, Whitehall will step in.

“There is a rolling three-year deadline for local authorities to deliver an additional affordable home and so far they have delivered well within their sales profile,” the DCLG said.

“However, we have always been clear that if local authorities don’t start building replacement homes within the three-year deadline, then we will step in and build them for them.”

(Top image c. Joe Giddens, PA Wire)

 

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Comments

A J Weller   11/08/2016 at 12:15

When my late father was a District Councillor at the time of the original Right to Buy I recall him saying that the Government had prevented Councils from being able to use the money raised to build replacement homes for rent because it could only be used to repair or refurbish the LA homes that remained in the public sector. While he had no objection at all to Council tenants buying their rented property (especially if they had been in them for a long time) he saw the restriction on the use of the income from the sales as a totally retrograde step as it could only lead to a lack of affordable homes. How right he was.

Eve Couzens   11/08/2016 at 13:11

The severe housing shortage will not be solved until the government makes a real effort, and, like the NHS, makes these two items a priority. The private rental sector has reached a scandalous height with couples priced out of the market. There is no control on ludicrous rents charged by unscrupulous landlords. A council housing policy must be put in place immediately. The only homes available are nothing more than slums. These are taken up by poor people who are unable to fend for themselves. It seems that the only homes available are to buy and at prices most people cannot afford. This is due to greedy developers snapping up any piece of land available and building for the second home market. The sale of council houses was originally a good idea but it got out of hand due to the lax laws meaning that these houses could be sold off later to anyone. In my area, if any former council houses come up for sale they are snapped up by buyers as second homes. They are then rented out as holiday lets at vast rents of up to £800 per week. When is someone with any common sense going to take control of this disgraceful situation? When you think about it, there is no housing shortage due to the amount of houses that stand empty most of the year. They are, of course, second/holiday homes!

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