Maybe This Writer is mistaken, but why are housing associations being viewed only in terms of debt?
There’s a certain amount of expenditure involved in the upkeep of the properties, certainly, but as a HA tenant, my experience is that it is never enough because these organisations always have to make money.
That means that housing associations are a continuing income stream – income that streams in to the owners for as long as they have the properties.
And that means one thing: Sell them off and they’ll be gone forever.
Is this more shortsightedness from the Conservative Government?
Wednesday’s Autumn Statement could mark the beginning of the end for the country’s 1,700 housing associations. The chancellor, announcing the results of the Comprehensive Spending Review (CSR) for the next three years, may announce that housing association assets will be sold off before the General Election in 2020 to help him achieve the elimination of the structural deficit in this parliament.
This could be the largest ever sale of public assets – which housing association homes became following the Office for National Statistics reclassification of associations as public bodies – and the most radical solution the chancellor could pursue.
Otherwise, Osborne faces £60bn of housing association debt – equivalent to 3 per cent of total public debt – sitting on the national accounts, throwing his debt reduction strategy into disarray, and a blockage to his status as favourite to succeed David Cameron as prime minister in 2019.
Getting shot of this debt, possibly by reversing the ONS reclassification, will be a major CSR priority.
The backdrop to this muddle has been the decision by successive governments since 1988 to deploy the housing association sector as a means of transferring council housing and leveraging private investment into social housing without taking a hit on what used to be called the Public Sector Borrowing Requirement.
Since 2010 though, Tory-led governments have set aside this consensus, aiming to fundamentally reshape social housing into so-called ‘affordable’ housing, while targeting social tenants for welfare cuts and negative stereotyping in the media.
A year of policies aimed at housing associations and their tenants, including lowering the Benefit Cap, imposed rent reductions for the next four years, requiring better-off tenants to pay market rents or to move out, and, most controversially, the extended right to buy, have all piled pressure on social landlords and tenants alike.
In the middle of the year, attacks on the housing association sector by Channel 4 News, the Spectator and The Times, claiming house building under-performance by associations, even though such claims have largely been refuted by housing commentators, was seen by many as a ‘softening-up’ of the sector.
Hot on the heels of these attacks came the rent reduction announcements in July’s Budget followed by a housing association vote in September on whether to accept the right to buy ‘voluntarily’, which was meant to head off the ONS decision reclassification – unsuccessfully, as it turned out.
Source: Will tomorrow mark the end of housing associations? | Left Foot Forward
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Worthy article Mike, Housing Associations need to be defended at this time. We all know there is a real problem with the lack of housing and I would hazard a guess that most people today cannot afford to buy their own home. As far as I see the selling of these even at a discount to tenants will only increase the price to purchase thereby raising House prices further than ordinary peoples capability. Only Property Tycoons will benefit .
There will always be some who can’t afford ‘affordable’ housing or part ownership. With continuous attacks on HB combined with Council Tax Support reducing as cuts bite deeper and extortionate rents in private sector it feels to me we are being herded into public acceptance of workhouses.
Tories wont stop until they decimate the country and then what’s left with nowhere else to go they’ll decimate themselves. Stupid Tories.
Many social housing tenants do not understand the implications of rights being eroded bit by bit. The original, and still existing law determines these properties are held in public trust, with the tenants having an equitable share, and consequently a say on their future. This was removed for a much (politically) trumpeted transfer to housing association for ‘some’. Those still under social landlord (local authority) are / were, seemingly ‘now’ the lucky ones. However, as part of these transfer proposals / enactments, rents were determined to be set at market levels for ALL local authority & housing association tenants, according to local levels. Those tenants eligible for right to buy, through housing associations had severe limitations imposed.
These changes cost the tenants who transferred to housing associations dear, they had the wool pulled over their eyes by government funded quango’s to circumvent the laws introduced to protect the poor. This is ongoing, and it seems will not end until the politicians have decimated the rights & communities of British people to live at a cost they can afford. It make one ashamed to be British.
You could be right Mike, even if it takes a few years to happen.
I recently read an article on The Common Weal, a Scottish online site, which was commenting on the whole RTB scenario. When housing was devolved the Scottish Government firstly decided to kill RTB for all new builds. After consultation with the Housing Sector it was then extended to all new tenancies. This means that, as tenants are replaced, the ownership of the property becomes secure and gives the Associations the confidence to spend. New building is increasing on that basis thereby expanding the public sector and affordable housing.
With the freedom they now have, a consortium of HAs are even planning their own not-for-profit power company to help tenants.
If RTB is let loose and made compulsory in England (& Wales?), any such confidence will be destroyed due to the lack of a secure, known income stream, as you said.