26/08/2011

Councils To Invest More In Affordable Housing

Housing Minister Grant Shapps has announced Government plans to give councils more financial freedoms to improve, buy and build new housing for their local community.

New proposals, published today for consultation, will allow councils more flexibility to trade their assets, and use the receipts to enable further investment in new homes and regenerating the local area.

Rather than seeking permission from Ministers in every case, local authorities will have greater discretion to use and improve their council housing assets in a way that best suits their community.

Mr Shapps said the move was in direct response to requests from councils across the country to streamline the complex regulations governing these sales and use of the receipts.

The new rules will protect existing tenants and ensure the money is spent for the benefit of the local community. The new rules will not affect occupied homes unless the sale is to the tenants themselves. Where assets are sold, councils will be able to keep the majority of receipts, as long as the money is spent on housing or the regeneration of the local area.

The extra flexibility will complement the most radical reforms to social housing in a generation, which are currently being introduced, and which are designed to bring a fundamental shift of power from Whitehall to councils and local housing associations.

Mr Shapps said: "For years councils have been hamstrung in their attempts to use social housing to its maximum effect, with a lazy consensus amongst politicians trapping one of our most valuable resources in a system that helps far fewer people than it should.

"If councils want to use their assets to improve the availability of housing for their local community, it is ridiculous that they are forced to ask a senior Government Minister for permission in every case. That's why I am today proposing greater freedom for councils to enable the judicious sale of assets.

"I also want to end the complex regulations that make it difficult for councils to boost local investment in new housing. Our proposals will streamline the rules so councils can recycle more receipts from these sales into improving the local availability of affordable homes. These changes will make the system fairer - councils will now be able to make decisions that genuinely meet the needs of local people, and the changes will not any affect any existing tenants."

(CD/GK)

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