Communities Secretary, James Brokenshire hosted
a roundtable with selected local authority leaders to explore how
they can work with the Government to deliver more council
housebuilding following the abolition of the HRA borrowing
cap.
The meeting took place on the 18 March in the
House of Commons.
Along with leaders of local authorities such as
ARCH members Norwich City Council and Exeter City Council that are
already successfully delivering new build programmes, wider sector
representatives including ARCH, together with Chartered Institute
of Housing, the Local Government Association and the National
Federation of ALMOs were also invited.
The Secretary of State reinforced the
Government's view that the abolition of the Housing Revenue Account
borrowing cap provides local authorities with a ground-breaking
opportunity to build a new generation of council housing. By
thinking creatively, local authorities can use this borrowing
flexibility alongside their existing powers and levers to build new
homes in innovative ways to meet local needs. But he recognised
that not all councils have the experience and expertise to build at
this stage.
He expressed a desire to tap into the
experiences of those from around the table and explore the appetite
for a knowledge sharing network that inspires councils, spreads
good practice and offers help and support to local authorities -
wherever they are in their housebuilding journey.
ARCH Chief Executive, John Bibby was able to
point to the fact that this is precisely what ARCH has been doing
to support its member councils via the ARCH Newbuild Network which we have expanded
recently to include representatives from the NFA and the Councils
with ALMOs Group. We were able to share examples of agendas and
issues discussed at recent Network meetings.
Representatives around the table, including
ARCH, recognised that the Government had recently introduced a
number of policy measures which had helped to remove some of the
uncertainties around HRA Business Planning to better enable
councils to make long-term investment decisions, including the
lifting of the HRA borrowing cap, the decision to abandon the idea
of a High Value Asset Levy and the introduction of a new 5 year
rent policy.
However, we also stressed that the Government
could do more to provide long-term certainty and better encourage
councils to use their new-found freedom to borrow prudentially to
invest in new and existing housing including among other
things:
- Re-introducing a 10-year social rent policy to help provide
greater certainty over future rental income needed to finance long
term loans.
- Providing greater flexibilities for councils on the use of RTB
receipts by issuing the long-awaited Government response to the
consultation on use of RTB receipts
published last year.
- Reviewing the Right to Buy which given the significantly higher
discounts on offer under the "re-invigorated RTB" introduced in
2012 was still a major barrier to investment in new council housing
for a significant number of local authorities and in particular
looking at the cost floor determination and the possibility of
regional caps on RTB discounts relative to regional property values
(as recently introduced for the Help to Buy Scheme).