Report suggests councils can build 6,400 homes a year and raise rents
SFHA attacks ‘flawed’ study
A report suggesting housing associations could build homes using less public money and that local authorities could raise rents is ‘flawed’, the Scottish Federation of Housing Associations has said.
The Scottish Government commissioned the research by Heriot-Watt and York universities between May and August this year.
The report, out this week, will be used for the Scottish Government’s housing policy paper due to be published in early 2011. The study concludes housing associations and councils could develop 6,400 homes a year up until 2034. It suggests:
- Scottish councils could raise rents using a standard formula based on the retail price index plus 1 per cent which would increase rents;
- Social landlords could reduce management expenditure through mergers and service sharing;
- Local authorities could make greater use of planning gain;
- Housing associations could make greater use of cross-subsidy, rather than using income from particular schemes to develop.
Mary Taylor, chief executive of the SFHA, said the study was flawed: ‘It is oversimplistic, not taking account of the fact that housing standards are rising to address climate change. Nor does it look at the costs of the services provided by housing associations and co-operatives to sustain tenancies.’
David Bookbinder, head of policy and public affairs at the Chartered Institute of Housing, said he was concerned: ‘Even the core assumption of RPI plus 1 per cent over 20 years gives cause for concern at a time when many council and housing association rents are already only just within reach of people in low-paid work.’
He added: ‘And that’s before we take account of the punitive housing benefit cuts which will hit many social housing tenants and may well affect landlords’ capacity to take on new borrowing and service existing debt.’
Scottish housing minister Alex Neil said there was potential to build homes at a lower cost to the taxpayer.