England’s council house system’s future is “in danger” according to a report spearheaded by Southwark Council.
Council budgets have been squeezed and costs increased due in part to an “unsustainable financial model” and “erratic national policy” the report found.
Led by Southwark Council, the report was jointly published with the help of 19 more of the largest council landlords across the UK, and makes a number of urgent recommendations to the new government.
“We’re in a really difficult position, it’s hard to exaggerate just how bad the council housing supply is” said independent housing expert, Rose Grayston.
“We’re now at a point where the financing model for council homes is so bad, that councils are struggling to maintain what they’ve got, and now many councils are considering selling off homes, just to pay for repairs to others” Rose continued.
The lack of repairs being carried out in council and housing association properties has become a real issue in recent years, giving rise to unprecedented numbers of claims for housing disrepair against landlords.
Unless there is real change soon, council landlords would “struggle to maintain their existing homes adequately or meet the huge new demands to improve them, let alone build new homes for social rent” Southwark Council added.
Significant budget constraints
The five main recommendations from the report are as follows –
- £644 million one-off ‘rescue’ payment
- A full reform of the council’s ring-fenced funding post, the Housing Revenue Account (HRA)
- Long term rent and debt agreements, and changes to the council’s Right To Buy policy
- Immediate restarts to ‘stalled’ house building projects and a new Green and Decent Homes Programme
- Swift removal of red-tape on existing funding
The Labour party has announced that due to the limitations on spending power for new homes, private investment must play a key role in the resolution of the housing crisis.
The annual cost of temporary accommodation for homeless families has increased 62% over the last 5 years and now tops £1.7 billion a year, according to Shelter.
Jim McMahon, Minister For Housing, understands the level of pressure the councils are under. “Our councils do a wonderful job but they’ve had to deal with very significant budget pressures.” He said.
“Building 1.5 million new homes will deal with significant demand in temporary accommodation because people have a safe, secure, affordable place to live” Mr McMahon continued.
