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Councils call for Right to Buy flexibility after Raab criticism
The councils with the largest deficits between Right to Buy sales and replacements have blamed the government’s lack of flexibility for the gap, following criticism from housing minister Dominic Raab.
Last week, the government slipped behind its pledge to replace additional Right to Buy sales on a ‘one-for-one’ basis for the first time since the policy was introduced in 2012.
Mr Raab hit out at councils in a written ministerial statement, saying they had “not been building enough” and “it is clear that local authorities need to increase their rate of delivery of new homes”.
The housing minister also pledged to “consult on providing greater flexibility… to ensure that we continue to support local authorities to build more council homes”.
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Inside Housing analysis of government data shows 12 councils have a gap of more than 1,000 between total sales and replacements started.
Four have sold more than 500 homes without starting a single replacement, despite taking millions in sales receipts (see table below).
Right to Buy homes sold and replacements started since April 2012
| Replacement homes started | Receipts (£000) | RTB homes sold | Deficit (homes) | |
|---|---|---|---|---|
| Birmingham | 803 | £137,693 | 3,010 | -2,207 |
| Leeds | 205 | £89,643 | 2,306 | -2,101 |
| Sheffield | 322 | £65,892 | 1,671 | -1,349 |
| Nottingham | 184 | £56,281 | 1,453 | -1,269 |
| Leicester | 284 | £60,929 | 1,476 | -1,192 |
| Kingston upon Hull, City of | 27 | £34,726 | 1,143 | -1,116 |
| Wolverhampton | 142 | £47,176 | 1,193 | -1,051 |
| Sandwell | 195 | £55,182 | 1,206 | -1,011 |
| Southwark | 293 | £170,918 | 1,303 | -1,010 |
| Newham | 227 | £117,289 | 1,185 | -958 |
| Greenwich | 282 | £123,573 | 1,229 | -947 |
| Dudley | 103 | £47,851 | 1,009 | -906 |
| Newcastle upon Tyne | 59 | £35,352 | 890 | -831 |
| Wigan | 0 | £32,290 | 829 | -829 |
| Gateshead | 0 | £31,581 | 768 | -768 |
| Bristol, City of | 45 | £39,596 | 798 | -753 |
| Tower Hamlets | 232 | £133,540 | 978 | -746 |
| South Tyneside | 31 | £27,065 | 751 | -720 |
| Barnsley | 70 | £29,626 | 785 | -715 |
| Kirklees | 61 | £31,618 | 775 | -714 |
| Manchester | 0 | £30,189 | 707 | -707 |
| Haringey | 134 | £91,784 | 811 | -677 |
| Derby | 108 | £37,019 | 784 | -676 |
| Stoke-on-Trent | 97 | £27,529 | 749 | -652 |
| Rotherham | 76 | £27,011 | 697 | -621 |
| Southampton | 39 | £39,875 | 653 | -614 |
| Doncaster | 0 | £23,191 | 608 | -608 |
| Lambeth | 54 | £91,560 | 635 | -581 |
| North Tyneside | 121 | £28,449 | 679 | -558 |
| Enfield | 156 | £69,418 | 704 | -548 |
| Norwich | 317 | £49,152 | 842 | -525 |
| Barking and Dagenham | 601 | £103,604 | 1,097 | -496 |
| Croydon | 83 | £63,703 | 567 | -484 |
| Islington | 283 | £146,282 | 743 | -460 |
| Waltham Forest | 66 | £64,287 | 525 | -459 |
| Northampton | 112 | £30,325 | 566 | -454 |
| Havering | 106 | £47,972 | 551 | -445 |
| Hounslow | 109 | £69,698 | 534 | -425 |
| Thurrock | 81 | £46,115 | 497 | -416 |
| Hackney | 239 | £102,741 | 644 | -405 |
| Basildon | 91 | £35,959 | 478 | -387 |
| Harlow | 22 | £36,181 | 409 | -387 |
| Ealing | 144 | £62,763 | 521 | -377 |
| Chesterfield | 25 | £18,085 | 393 | -368 |
| Lewisham | 155 | £56,175 | 520 | -365 |
| Stockport | 0 | £18,392 | 364 | -364 |
| East Riding of Yorkshire | 24 | £18,910 | 362 | -338 |
| Hillingdon | 288 | £75,074 | 619 | -331 |
| York | 36 | £23,339 | 330 | -294 |
| Welwyn Hatfield | 151 | £58,447 | 442 | -291 |
| Luton | 87 | £29,091 | 377 | -290 |
| West Lancashire | 17 | £12,590 | 300 | -283 |
| Camden | 201 | £110,968 | 476 | -275 |
| Hammersmith and Fulham | 40 | £59,967 | 306 | -266 |
| Brent | 35 | £42,704 | 299 | -264 |
| Swindon | 72 | £19,106 | 333 | -261 |
| Northumberland | 0 | £10,413 | 247 | -247 |
| Barnet | 182 | £63,484 | 429 | -247 |
| Stevenage | 164 | £40,212 | 411 | -247 |
| North East Derbyshire | 45 | £13,668 | 291 | -246 |
| Bury | 0 | £9,921 | 242 | -242 |
| Lincoln | 18 | £11,266 | 256 | -238 |
| Ipswich | 129 | £22,427 | 364 | -235 |
| Redditch | 27 | £14,280 | 262 | -235 |
| Charnwood | 4 | £12,518 | 237 | -233 |
| Slough | 72 | £38,483 | 303 | -231 |
| Milton Keynes | 132 | £29,932 | 363 | -231 |
| Dacorum | 232 | £61,701 | 463 | -231 |
| Portsmouth | 211 | £27,092 | 439 | -228 |
| Solihull | 114 | £18,004 | 341 | -227 |
| Cheshire West and Chester | 0 | £9,226 | 226 | -226 |
| Redbridge | 71 | £31,329 | 291 | -220 |
| County Durham | 0 | £7,109 | 207 | -207 |
| Cornwall | 77 | £20,801 | 276 | -199 |
| Great Yarmouth | 29 | £10,319 | 222 | -193 |
| Brighton and Hove | 129 | £34,977 | 318 | -189 |
| Ashfield | 52 | £9,444 | 241 | -189 |
| Corby | 50 | £11,331 | 229 | -179 |
| Nuneaton and Bedworth | 15 | £8,286 | 192 | -177 |
| Colchester | 35 | £15,766 | 211 | -176 |
| Mansfield | 22 | £7,521 | 196 | -174 |
| Tamworth | 33 | £9,926 | 207 | -174 |
| South Kesteven | 65 | £12,325 | 232 | -167 |
| Taunton Deane | 83 | £16,093 | 242 | -159 |
| Darlington | 0 | £6,022 | 156 | -156 |
| Sutton | 158 | £38,266 | 314 | -156 |
| Reading | 41 | £17,478 | 193 | -152 |
| Bassetlaw | 33 | £7,809 | 185 | -152 |
| North West Leicestershire | 23 | £9,439 | 172 | -149 |
| Cannock Chase | 23 | £7,087 | 171 | -148 |
| Central Bedfordshire | 19 | £15,861 | 166 | -147 |
| Salford | 0 | £4,877 | 147 | -147 |
| Hinckley and Bosworth | 8 | £8,300 | 155 | -147 |
| Bolsover | 54 | £8,563 | 200 | -146 |
| Crawley | 262 | £47,341 | 405 | -143 |
| Wandsworth | 223 | £53,412 | 365 | -142 |
| Rugby | 10 | £10,127 | 151 | -141 |
| Shropshire | 26 | £9,356 | 155 | -129 |
| Kingston upon Thames | 49 | £24,319 | 176 | -127 |
| Cambridge | 171 | £42,937 | 296 | -125 |
| Dover | 37 | £11,096 | 159 | -122 |
| Southend-on-Sea | 20 | £11,657 | 136 | -116 |
| Mid Suffolk | 35 | £12,904 | 151 | -116 |
| Warwick | 87 | £17,366 | 199 | -112 |
| Dartford | 30 | £13,506 | 139 | -109 |
| Canterbury | 46 | £14,527 | 154 | -108 |
| Kettering | 25 | £6,937 | 132 | -107 |
| Exeter | 86 | £13,322 | 189 | -103 |
| Broxtowe | 24 | £5,923 | 127 | -103 |
| Newark and Sherwood | 34 | £7,445 | 137 | -103 |
| Gravesham | 67 | £15,817 | 169 | -102 |
| High Peak | 12 | £6,133 | 113 | -101 |
| Ashford | 65 | £14,656 | 165 | -100 |
| Harrogate | 0 | £8,525 | 98 | -98 |
| Oxford | 85 | £28,600 | 181 | -96 |
| Woking | 30 | £17,545 | 125 | -95 |
| Cheltenham | 30 | £8,600 | 124 | -94 |
| South Holland | 4 | £5,584 | 96 | -92 |
| Sedgemoor | 34 | £8,025 | 126 | -92 |
| Selby | 15 | £5,464 | 104 | -89 |
| Barrow-in-Furness | 0 | £3,418 | 88 | -88 |
| Waveney | 28 | £7,110 | 116 | -88 |
| Tendring | 0 | £4,819 | 86 | -86 |
| Lancaster | 0 | £4,422 | 84 | -84 |
| Bournemouth | 85 | £14,906 | 169 | -84 |
| Westminster | 133 | £58,019 | 215 | -82 |
| Thanet | 18 | £6,601 | 100 | -82 |
| Mid Devon | 24 | £7,197 | 105 | -81 |
| Stroud | 55 | £10,826 | 136 | -81 |
| Babergh | 38 | £10,446 | 119 | -81 |
| Eastbourne | 54 | £10,049 | 132 | -78 |
| East Devon | 71 | £11,957 | 145 | -74 |
| Blackpool | 0 | £2,217 | 70 | -70 |
| Shepway | 32 | £7,692 | 102 | -70 |
| Gosport | 21 | £6,068 | 90 | -69 |
| Brentwood | 16 | £9,638 | 82 | -66 |
| North Warwickshire | 75 | £7,852 | 141 | -66 |
| St Albans | 77 | £23,111 | 141 | -64 |
| Epping Forest | 147 | £27,169 | 208 | -61 |
| Arun | 45 | £9,603 | 106 | -61 |
| Melton | 15 | £3,945 | 71 | -56 |
| Fareham | 13 | £5,066 | 67 | -54 |
| Adur | 6 | £4,985 | 54 | -48 |
| Wokingham | 18 | £8,920 | 64 | -46 |
| Oadby and Wigston | 1 | £2,241 | 44 | -43 |
| South Cambridgeshire | 112 | £20,497 | 155 | -43 |
| Richmondshire | 0 | £2,269 | 42 | -42 |
| Waverley | 51 | £13,937 | 90 | -39 |
| Uttlesford | 22 | £8,448 | 61 | -39 |
| Harrow | 139 | £28,935 | 177 | -38 |
| South Derbyshire | 75 | £6,006 | 112 | -37 |
| Lewes | 34 | £8,265 | 71 | -37 |
| Gloucester | 30 | £3,351 | 65 | -35 |
| Poole | 105 | £13,395 | 139 | -34 |
| Wealden | 70 | £9,328 | 102 | -32 |
| City of London | 18 | £8,927 | 47 | -29 |
| Runnymede | 26 | £9,658 | 53 | -27 |
| Guildford | 98 | £18,841 | 119 | -21 |
| Kensington and Chelsea | 87 | £24,036 | 107 | -20 |
| Castle Point | 30 | £3,729 | 47 | -17 |
| Medway | 57 | £5,806 | 69 | -12 |
| Tandridge | 68 | £9,112 | 71 | -3 |
| Oldham | 0 | £106 | 2 | -2 |
| Wiltshire | 196 | £15,069 | 191 | 5 |
| New Forest | 179 | £18,309 | 159 | 20 |
| North Kesteven | 158 | £6,943 | 126 | 32 |
| Winchester | 160 | £16,639 | 126 | 35 |
Source: MHCLG live tables
But councils hit back at Mr Raab, saying government rules which see a portion of the receipts from sales returned to the Treasury and only being allowed to fund 30% of the cost of a new build have hobbled their efforts to provide replacements.
Andy Connelly, assistant city mayor for housing at Leicester City Council, which has started 284 replacements and sold 1,476 homes since 2012, said the council gets to keep an average of just £20,000 per sale.
“Leicester has lost about 40 per cent of its council housing since the start of Right to Buy in the 1980s,” he added.
“If the government truly wants to support local authorities to create more affordable housing, the easiest way would be to remove the borrowing cap it places on local authorities.
“More affordable homes could be built if the government allowed receipts from homes to be used to fund more of the cost of new builds, and to be more flexible about using receipts alongside funding from Homes England.”
Jane Urquhart, portfolio holder for planning, housing and heritage at Nottingham City Council which has delivered 184 replacements to 1,453 sales, said: “The restrictions placed on the spending of the replacement funds by the government are limiting our ability to deliver new homes.
“In 2017, the average replacement funding we received for each RTB sale was £13,638 per house, while it costs over £100,000 to build each new home, so it should be no surprise that we can’t replace homes on a one-for-one basis.”
A spokesperson for Gateshead Council, which has started no replacements despite selling 768 homes, said: “Since 2012, Gateshead has sold 627 homes for £25.8m and retained only £14.2m in receipts against a market value of £53m. The government retained £11.6m.”
The flexibilities councils are requesting
Councils are requesting the following flexibilities over the use of Right to Buy receipts:
- Councils to be able to retain 100% of Right to Buy receipts
- Receipts to be used on more than 30% of the cost of building replacement homes
- Receipts to be combined with grant/capital
- Extending cost floor ceiling to 25 years
- Extending receipt time limit to five years
- Councils to be allowed to reduce RTB discounts locally where they can show this would not have an impact on sales and that they can’t build enough replacements otherwise
Source: Association for Retained Council Housing
A spokesperson for Gateshead Council, which has started no replacements despite selling 768 homes, said: “Since 2012, Gateshead has sold 627 homes for £25.8m and retained only £14.2m in receipts against a market value of £53m. The government retained £11.6m.”
A Manchester City Council spokesperson said: “As councils can only use a portion of the Right to Buy receipts to replace council homes lost to Right to Buy, local authorities are put in a position where it is increasingly difficult to maintain the levels of social housing for residents that need them.”
John Bibby, chief executive of the Association of Retained Council Housing, said that along with the National Federation of ALMOs he would ask government for six changes to help councils build (see list, above) – including retaining 100% of receipts, lifting the 30% cap and allowing receipts to be combined with grant.
When the government lifted Right to Buy discounts in 2012, it promised to replace any additional homes sold as a result of the increased discounts within three years.
The target to meet this pledge stands at 17,021, but only 15,981 replacement homes have been started or acquired so far.
In total 63,581 council homes have been sold since 2012.
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