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Javid: new rent policy ‘very, very soon’
The government will set out a formula for social landlord’s rents “very, very soon”, Sajid Javid has said.
Speaking last night to northern housing association chief executives and representatives from northern councils at the launch of a report on housing need in the North, the communities secretary pledged to settle the question of what will happen to social landlords’ rents after 2020.
He said: “We said we’d consult and then set out a formula. We’re going to do that very, very soon.”
The government’s Housing White Paper, launched in February this year, promised a new deal on rents once the four years of 1% reductions come to an end in 2020.
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It said: “The government will set out, in due course, a rent policy for social housing landlords (housing associations and local authority landlords) for the period beyond 2020 to help them to borrow against future income, and will undertake further discussions with the sector before doing so.”
Last night’s announcement is the first clear indication following months of speculation that the government is close to a decision.
The fact that Mr Javid mentioned a “formula” could suggest a return to a universal rate, such as the consumer price index +1%, the previous rate of increase for rents, which was abandoned for the rent cut. This rate was scrapped in April last year when the rent cut, a flat 1% decrease until 2020, was introduced.
Several solutions have been suggested, including a report from Policy Exchange released in September last year, which suggested that housing associations could be given flexibility over rent in exchange for certain volumes of housebuilding.
The government is understood to have raised this idea with the sector, although privately many social landlords have said it would be extremely to make work in practice.
In the Conservatives’ 2017 general election manifesto, the party promised to “give greater flexibility to housing associations to increase their housing stock”, prompting many leading figures in the sector to call for rent freedom.
Mr Javid is due to address the National Housing Federation conference on Tuesday next week.
