The reform of the housing revenue account could be a missed opportunity if councils aren’t given more freedom, argues Alex Thomson
Seize the moment
We need to build more houses, a lot more. And the government’s housing strategy, with its panoply of policies, makes clear that they know it. But could it be another government policy that opens the door to local authorities playing a major part in house building? Specifically, the forthcoming changes to the housing revenue account system. In the 1950s, councils in England were building almost 150,000 homes a year. While recreating that kind of activity isn’t likely to happen, reform of the HRA seems to offer local authorities the chance to once again contribute to developing the new housing the country desperately needs – will they be allowed to seize it?
Our recently published policy platform sets out three distinct perspectives on this important issue, and there are some common themes that emerge. Most notably, all our contributors – Cllr Gary Porter, leader of South Holland DC, John Synuck, chief executive of Swan HA, and Cllr Tim Coleridge, cabinet member for housing at RB Kensington & Chelsea – while offering constructive, qualified endorsement of the forthcoming reforms, question whether authorities will gain enough financial autonomy to manage their stock effectively and free them to build. So it looks like it could be a major opportunity missed.
I believe that the logic of the HRA buyout should be followed through. If local authorities are to take on substantial levels of debt in order to become responsible for the management of their own housing stock, they should be allowed to retain all the benefits of managing that stock. And that includes the Treasury loosening the straitjacket and empowering local authorities to borrow against their stock to finance a new wave of council house building. Everyone should be playing their part in delivering the housing we all need, and councils are uniquely placed to play a key role – let’s let them do it.
Alex Thomson is chief executive of Localis