22 November 2007
We received a petition asking:
"We the undersigned petition the Prime Minister to provide the ‘Fourth Option’ of direct investment in council housing as an alternative to privatisation by stock transfer, PFI or ALMO, to enable local authorities to respect the choice of their tenants and bring all homes up to at least the government’s Decent Homes Standard by 2010 and also build a new generation of decent, affordable and secure council homes for rent, accountable to an elected local authority landlord, and to give a clear commitment to defend the lifelong secure tenancy that council tenants enjoy and uphold the right of everyone who needs or wants to rent public housing to do so without time limit or means testing so that council housing can again become a tenure of choice and council estates can once again be a place that people are proud to live in."
Details of Petition:
"Government takes money out of council housing, leaving many councils unable to meet the government’s Decent Homes standard. The government then offers extra investment - but councils have to access one of 3 options to get it, transferring either their homes or the management of them into the private sector. We are asking for the ‘fourth option’ - a level playing field so that the same amount of money can be invested in council housing directly. If all council housing rents and receipts were ringfenced there would be more than enough to do all the work that is needed. Private sector interests are now lobbying to take away our security of tenure, and bring in market forces, because they claim our estates have become ‘unsustainable’. But there is a massive housing crisis in this country and the private market is incapable of solving it. Adequate investment, coupled with building new council homes again, would solve problems of sustainability and help to solve the housing crisis."
Read the Government’s response
The government has greatly increased the resources directly available to councils for housing.
Between 1997 and 2007 we have increased the funding available for each council house by an average of 30% in real terms On top of that we have also made £3.7 billion available to local authorities setting up ALMOs. In total we have invested over £20 billion of public money in improving council housing since 1997. However, the substantial progress we have made in refurbishing homes to meet modern decent standards has only been possible because we have also levered in an additional £7.3 billion through independent borrowing by not for profit Housing Associations as a result of stock transfers.
To allow Local Authorities to borrow money on the same terms as Housing associations would cost the public purse an extra £12 Billion over the next three years, this is simply unaffordable.
Housing finance is already ring fenced at a national level; housing revenue cannot be spent on non-housing investment.
The Government operate housing subsidies as a national system, taking assumed surpluses from some authorities and using them to fund assumed deficits in other authorities, as these reflect other arbitrary historical funding decisions and rarely match relative need. We are also developing pilot schemes for councils to opt out of the Housing Revenue Account and become self funding. However, this is complex given the need to ensure that other councils do not lose out as a result.
Thank you for signing this e-petition.