Swindon Council’s Conservative Group says it will support the extension of ‘right to buy’ but fails to justify the policy nor explain how it will improve the housing situation.

Swindon Tenants Campaign Group recently wrote to Swindon Councillors calling on them to oppose the extension of ‘right to buy’ (RTB) to Housing Associations and the enforced sale of ‘high value’ Council housing to pay for it.[1] The receipts from the sale of Council homes would be used to subsidise Housing Associations for part of or all of the difference between the discount to their tenants under RTB and the value of their homes.

We have received a reply from Emma Faramarzi on behalf of the Conservative Group (See below). The essential message was that they had won the election and this policy “received the necessary endorsement by the British electorate” so the group would be supporting the government. Of course, 63.1% of those who voted voted against them, and they secured just under 25% support from the electorate. (Download a PDF of this here faramarzi or read on below) 

As you can see Emma’s letter fails to address the issues we raised and doesn’t even seek to justify the policy other than with reference to the parliamentary arithmetic. Whether that’s because the Conservative group believes it doesn’t have to justify it or because it doesn’t feel confident in doing so (there is little detail yet available on the forthcoming Bill) is a matter of speculation. However, even if they do support the policy it has practical consequences which will impact on the housing situation in Swindon which they will ignore at their peril. We already know enough to understand what these implications are.

According to Swindon Council’s own assessment each year in the town there are 800 too few “affordable homes” built in Swindon. In other words the situation deteriorates each and every year. This is the context in which the Conservative Group says that it supports extension of ‘right to buy’ to HA’s and the enforced sale of ‘high value’ Council housing. If they do support it then surely they owe an explanation to all those suffering the consequences of the housing crisis locally. Will this policy improve the housing situation or make it worse? If they think it will improve it let them explain how.

Emma’s letter accuses us of supporting “government control of housing”. This is ironic, because the reverse is the case. We are opposing central government controlling Council and Housing Association housing. It is the Conservative group which is supporting government control since:

➢   The government is proposing to force HA’s to sell their homes – homes that do not belong to the government, and

➢   To force Councils to sell ‘high value’ homes to subsidise the sell-off.

Swindon’s Conservative Group is supporting a central government diktat which completely contradicts its ‘localism’ agenda, which was supposedly meant to give more power to local communities. It is worth reminding the Conservative Group that their ex-Leader Rod Bluh complained of the coalition government imposing central government control behind the facade of ‘localism’. The RTB proposals are another example of this.

The policy, if implemented, will undermine the finances of both Housing Associations and local authority Housing Revenue Accounts. When the new Council Housing Finance system (‘self-financing’) was introduced in 2012 we were told that Councils were ‘buying themselves out’ of the housing subsidy system. They are under local authority ownership. The HRA receives no government subsidy. So why should central government tell local authorities what they have to do with our housing stock?

The ‘debt’ which the government imposed on us was based on an estimate of the number of properties we had and the rental income the Council would receive over 30 years. If a local authority has to sell homes on the open market and subsidise RTB for the homes of other organisations then the 30 year ‘business plan’ which the government told them they had to draw up would be undermined. Owing to the loss of rental income the HRA would have less money than the business plan estimated. It would have less money for the maintenance of our homes than was planned for.

“Choice”…if you can afford it

In place of dealing with the concrete issues we raised Emma presents us with an abstract expression of the philosophy of the Conservatives, as it applies to housing. She says:

“A key component of the Party’s belief  is that individuals and families know what is best for themselves and the state, whether it is in the form of Whitehall, the Council or non-government agencies, do not….”

And

“The challenge we face is supporting private sector developers to build the range and quality of houses that residents would like. I believe that our housing and planning policies will complement this.”

Essentially this expresses a reliance on ‘the market’. Yet people only have choice if they can afford to take out a mortgage. The reality of today’s housing situation is that less and less people have a choice. If they don’t have sufficient income to take on a mortgage then they will either have to carry on living with their family, as many more young people are doing, or move into the private rental market where rents are much higher than Council rents and there is little security of tenure. Private developers are not interested in building homes according to need but to maximise their profits. Residents may ‘like’ a house but it doesn’t mean they are in a position to buy one. Housing is not like the commodity market for beans where you can easily chose which brand you prefer. Moreover, given the inflated price of houses it can readily become an albatross around your neck when circumstances intervene, such as the loss of a job or illness.

As with much of the rest of the country in Swindon there has been a decline in home ownership, a decline in the numbers of people with mortgages, and the subsequent huge increase in private rented accommodation where private landlords can take advantage of the housing shortage to push up rents. And, as we know, this has driven up the HB bill in the private rented sector.

Emma says

“Your comment about the loss of homes is incorrect. Exactly the same number of people will be in homes after right to buy as there were before.”

This is disingenuous. Clearly if they are being sold off they are not being demolished. The point, of course, is that the Council and Housing Associations will lose homes under their ownership, which means that there will be less homes available for people on the Council’s housing waiting list. This will make the “affordable homes” housing gap even worse. If the Conservative Group is in favour of giving away some of our Council homes to subsidise the sell-off of HA homes then it surely should explain why.

Blind faith in ‘the market’ when all the evidence shows that it cannot resolve the housing crisis is a recipe for increasing the shortage of genuinely affordable homes. Only those with the necessary resources can really have housing choice. If house building remains dominated by commodity production then as with any other commodity, those who can afford it can buy, those who can’t will have to go without. Rob Buckland has admitted that there is ‘an acute social housing shortage’. The extension of RTB and the enforced sale of ‘high value’ Council homes will increase this shortage.

Martin Wicks

Secretary, Swindon Tenants Campaign Group

June 26th 2015

Appendix

Emma Faramarzi letter to Swindon Tenants Campaign Group

Dear Martin,

Thank you for your emailed letter of 3rd June concerning the Government’s proposals to allow Housing Association Tenants to own their own homes.  I am replying on behalf of the Administration Group, a Group that increased its majority at the local elections and came within a handful of votes of securing a Conservative Councillor in Park South for only the second time since 1973.

This policy was part of the Conservative Party Manifesto and both of Swindon’s Conservative MPs were returned with increased majorities.  A key component of the Party’s belief is that individuals and families know what is best for themselves and the state, whether it is the form of Whitehall, the Council or non-government agencies, do not.  Therefore, I am confident that this policy has received the necessary endorsement by the British electorate.

Your comment about the loss of homes is incorrect.  Exactly the same number of people will be in homes after right to buy as there were before.  The challenge we face is supporting private sector developers to build the range and quality of houses that residents would like.  I believe that our housing and planning policies will complement this.

I do not accept your assumption that government control of housing is a solution to anything.  This Council will continue to support a diverse range of homes that give people real choice, as we set out in the Housing Strategy that I took to Cabinet last year.

Therefore, the Conservative Administration will be supporting the Conservative Government.

Yours sincerely,

Councillor Emma Faramarzi

Cabinet Member for Housing and Public Safety

For and on behalf of the Conservative Group

[1]   https://keepourcouncilhomes.wordpress.com/2015/06/02/1021/