Report calls for councils to take lead on housing delivery
Councils are struggling with an £18 billion debt burden left over from the post-war house-building boom, according to a report from the Local Government Information Unit (LGIU) which calls for a “radical new approach” to the delivery of sustainable council housing.
Published in conjunction with Southwark Council, which owns 55,000 homes, the report ‘Once and for all – funding the improvement gap in existing council housing’, says that the debt legacy and piecemeal approach to housing policy has left the delivery of council housing in an unsustainable financial position.
Local authorities must be allowed to take the lead on a radical new approach to delivering council housing which includes paying down debt and making every house a liveable one, according to the report. This could be done without increasing total spending by lowering interest rates, it argues.
Report Author Amelia Walker said:
“It’s easy to say that freeing councils from Whitehall control will deliver change, but this is only credible when there is a clear plan – a new route map for change,” said the report’s author Amelia Walker. “This report does what government has consistently failed to do – look at housing in the round. Existing council housing and new build housing are not separate – it all comes from the same diminishing pot of resources. Councils can deliver radical change – but only if they have the freedom to spend with an eye to the future, not to the next target.”
In her report, Walker identifies what are considers a series of failures in existing policy. They are:
• a legacy of debt left over from the post-war building boom, leaving local government straining with the burden of £18 billion in debt with no plans to ever repay
• a Decent Homes policy which has pressured local authorities to invest without regard for tenant wishes or long term sustainability
• a legacy of underfunding which has left local tax payers picking up the bill for routine management and maintenance
• a lack of any plan to get council housing out of a cycle of decline and into a state which is viable financially and robust to meet future needs
The report advocates a new definition of success to guide policy makers called Sustainable Social Housing and advocates a route-map to this proposed sustainable future.
The three point plan calls for the restructuring of debt repayments to take advantage of historic low rates and allow councils a ten year payment holiday; use the funds freed each year to fund a massive renewal plan that would leave houses in “top condition” and therefore cheaper to maintain; and use the funds freed up from repair budgets to pay down debt over 25 years.
“Getting more and better work done with less money is crucial for this council. The council has an investment programme of some £100 million a year, £70 million of which is directly spent on housing and over £20 million on regeneration,” said Councillor Kim Humphreys, Southwark’s executive member for housing.
“Consultation with tenants has consistently shown that the government’s Decent Homes programme doesn’t cover everything they want, but we continue to be put under pressure to make skewed investment decisions to follow a noble, but limited policy that is simply not suited to boroughs like Southwark. We are also continually hamstrung by the constraints of the centralised Housing Revenue Account from using our resources rationally.
“We are clear that if government combined a hands off approach on policy with collaboration on skills and strategy we could deliver a programme that would last for generations – and make council housing financially viable once and for all.”
