The government has announced that councils can keep Right to Buy receipts from 2022/3 and 2023/4 and have five years to use them. They have also announced that the restrictions on acquisitions (buying homes on the market to add to the council housing stock) will be frozen at 50%. In other words councils can make no more acquisitions than the number they build. The restriction was to be tightened to 40% and then 30%.
Far be it for us to link these temporary changes to a general election but the letter to councils says
“Local authorities should not wait to begin using their retained receipts and can immediately begin incorporating this additional funding into their build plans.”
Get on with it. However, this is unlikely to mean that councils are going to build more homes, certainly before the general election.
In relation to the year 2022/23 councils have handed over part of the receipts to the government. Are they going to hand them back quickly?
So long as Right to Buy exists then we are in favour of councils keeping 100% of receipts and having the ability to use them as they wish, though only for council housing. However, last year RTB sales were 10,974 and when you take account of demolitions councils have to build more than 12,000 homes to stem the loss of stock. As you can see from the table below over the last five years English councils have built and bought more than 33,000 homes, yet as a result of RTB and demolitions there was still a loss of stock of more than 28,000. It’s unlikely that keeping all the receipts will enable all of these losses to be replaced.
Abolishing RTB would mean that all new build/acquisitions would for the first time increase the stock rather than sturrgle (and fail) to stem the loss.
Table: Changes in local authority stock, England
|New Build||Acquisitions||Conversions +||Conversions –||Demolitions||Right to Buy||Overall + or –|
Conversions + = conversions which increase the stock and minus that decrease it.