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The ARCH annual report for 2015-16 is now available to view.

 

Download it here.

What will the General Election mean for stock-retained councils? 27/04/2017

Now that we face a snap General Election in June - an announcement that caught everyone by surprise - what will it mean for stock retained councils?

 

We're currently awaiting the publication of the main political parties' manifestos but, as in the last General Election, ARCH will provide briefings for ARCH members on what the Manifestos say about housing. Watch out for our "Manifesto Watch" in future editions of the ARCH Bulletin and on our website.

 

In the meantime, ARCH will continue to work with the National Federation of ALMOs (NFA) to highlight the case for council housing and, in particular:

 

  • the importance of investing in council housing and enabling councils to build; and
  • supporting hard-working tenants by mitigating the impacts of welfare reform.

 

Investing in council housing and enabling councils to build

 

All of Britain's main political parties agree we need more homes. To meet the national housing shortage, we need to increase the number of new homes built each year to at least 240,000, a fifty per cent increase in output. Councils have crucial roles to play in achieving this ambition - by ensuring that land is available and the necessary infrastructure is provided and by enabling and commissioning the construction of new homes. However, councils and ALMOs can also play a much bigger role by building homes themselves if the next government allows them to use their assets and future rental income to develop new homes.  

 

In 2012, there was all-party support for legislation to allow council housing to become properly self-financing from rental income alone without any direct revenue subsidy to or from the taxpayer.  As a result, councils and ALMOs have been able to complete over 5,500 new affordable homes since 2012. However, a recent report by CIH/CIPFA "Investing in Council Housing" shows that the potential to deliver a further 550,000 homes over the next 30 years has had to be revised downwards to no more than 45,000 homes - in part as a result of the decision in 2015 to impose a cut in council rents of 1% each year until 2020.

 

Investment in new and existing council homes is likely to reduce even further if the government proceeds with a levy on council housing assets to pay for the extension of Right to Buy to housing associations.

 

Housebuilding creates local jobs and boosts the economy generally. At this time of particularly high housing costs and uncertainty in the labour and housing markets due to Brexit and the urgent need to provide more housing of all tenures, ARCH urges all political parties to back councils to play a bigger role in meeting the need for affordable housing of all tenures by:

 

  • Unlocking the potential to invest in council housing by re-instating the principles of self-financing introduced with all-party support under the Localism Act 2011
  • Lifting the Housing Revenue Account debt caps to enable councils to invest in new housing, allowing councils to prudentially borrow against future rental income to enable councils to "invest to save" in new homes and pay back the money from their rental income.
  • Allowing councils to retain all the capital receipts from selling any of their housing assets, including those sold under the statutory Right to Buy, in order to re-invest in building new homes and maintaining the existing stock.
  • Reversing the future under investment in social housing by scrapping the 1% mandatory reduction in council housing rents planned for 2018/19 and 2019/20 and reintroducing a new 10 year social & affordable rent policy, recognising that council rents are already some of the lowest rents in the whole social housing sector.
  • Accepting the recommendations of the Communities and Local Government Select Committee for any extension of a right to buy to housing association tenants to be funded by central government rather than through a High Value Asset Levy on stock-retained councils.
  • Supporting a new social housing building programme which a recent economic appraisal by Capital Economics demonstrated would pay for itself in the long term and save the public purse significant amounts of money through a lower welfare bill as well as giving a boost to our national economy at a time of economic uncertainty and help relieve our national housing crisis in the short term.

 

Supporting hard working tenants by mitigating the impacts of welfare reform

 

Councils and ALMOs are currently helping their tenants to manage a wide range of far reaching changes to the welfare system and where appropriate supporting tenants into work. Whilst we welcome efforts to make the welfare system simpler, fairer and support people into work; research by ARCH and the NFA highlights significant concerns about the impact that some of the current welfare reforms are having on tenants and communities across the country. To mitigate some of the most adverse consequences of the reforms we urge all parties to consider:

 

  • Making payment direct to landlord under Universal Credit a 'tenant choice'.
  • Removing the seven-day waiting period for a Universal Credit claim to start.
  • Paying any entitlement to Universal Credit in advance, instead of in arrears, recognising that Universal Credit is a vital safety net for people in low paid employment or with no other means of supporting themselves. 
  • Resourcing social landlords to provide support to claimants on budget management, debt management, digital inclusion and financial inclusion and suspending the roll out of Universal Credit until:
    • DWP improves its processes (faster/more accurate processing of applications and payments)
    • There is better training for Job Centre Plus staff, to improve understanding of housing issues
    • Social landlords having more control over APAs (Alternative Payment Arrangements) and the Trusted Partner pilot is rolled out fully with resources.
    • There is better communication between landlords and DWP.

 

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