Legislation extending HRA self-financing to the 11
stock-retaining councils in Wales is likely to receive Royal Assent
on 17 September, it was reported this week.
The Housing (Wales) Bill was agreed by the Welsh
Assembly on 8 July and subsequently survived the four week period
of "intimation" during which the Solicitor General has to decide
whether a Bill's provisions are within the powers of the
Assembly. It now joins the queue of items awaiting Her
Part 5 of the Bill abolishes the housing subsidy system for
councils in Wales and gives Welsh Ministers the power to make a
financial settlement transferring debt to or from councils to
implement the new self-financing system under which rent income
will be retained locally in full. This part of the Act would
come into effect two months after Royal Assent.
Self-financing is expected to be introduced from April 2015.
As in England, each council will be set a borrowing limit based on
historic debt. Interestingly, the power to set these debt
caps for councils in Wales remains with the Treasury in London.
The Bill also gives the Welsh Government powers to set standards
for local authority rents and service charges. Currently,
government influence over council rents is exercised through the
subsidy and rent rebate systems - there are strong financial
incentives to comply with rent guidelines but councils remain free
to set rents differently if they choose.
Anticipating abolition of the subsidy system, the Bill allows
Ministers to set a target rent band within which local authorities
will be legally required to set their average rents. There is
also scope for consideration of a higher rent regime similar to the
"affordable" rents charged on some dwellings in England.
Councils will be expected to make achievement of the Welsh Housing
Quality Standard - similar to the Decent Homes Standard which
applies in England - the first priority for new investment made
possible by self-financing. There will be a legal requirement
to achieve the standard throughout the housing stock by 2020 and
maintain it thereafter.
ARCH representatives will be meeting officers from the 11 councils
affected in Wales on 12 September to share learning from the
experience of implementing self-financing in England and discuss
how ARCH can help support its implementation in Wales.