Memorandum submitted by Defend Council Housing (H&R 1)


Evidence submitted to Public Bill Committee of

'Housing and Regeneration Bill'

5th December 2007



Issues in the Bill

Means-testing, profit and deregulation

Funding Existing Council Housing

Building New Council Housing

Homes and Communities Agency

Fair and Balanced Debate

The Future Funding of Council Housing

Government robs tenants rents - and the robbery is getting bigger

Funding the 'Fourth Option'

The Money's There

What we're fighting for

The Urgent Need for Third Generation Council Housing

The History of Council Housing

Independent Tenants Movement not Consumer Panels

Independent Inquiry of MPs into Housing Bill

Statement by Austin Mitchell MP, chair, HOC Council Housing group

Early Day Motion 368 'Investment in Council Housing'

Details of Inquiry

Evidence sought

HOC Council Housing Group recommended code of practice for fair and

balanced debate



Defend Council Housing is a campaign led by council tenants and supported by trade unions (UNITE, UNISON, UCATT, GMB, PCS, FBU, RMT, CWU), councillors, MPs and other supporters of council housing.

Our main concern regarding the bill is the absence of concrete measures to enable all local authorities to bring existing council homes up to the Decent Homes Standard, build new, and maintain new and existing homes into the future. We are also concerned about proposals in the bill to

Introduce means testing to 'low cost rented housing'

Discriminate against councils building new homes while offering public money to profit-making companies with little protection for either tenants or taxpayers

Transfer key responsibilities from elected Ministers and government departments to an unaccountable regulator

Give the regulator powers to determine criteria for allocating accommodation, terms of tenancies and levels of rent

Break up the national Housing Revenue Account without long-term guarantees for funding council housing

Enable predatory landlords (similar to 'Tenants Choice' under HATs in 1988) to 'persuade' tenants to ballot to transfer their homes and estates

2. We wish to draw the committee's attention to the implications of the Impact Assessment of the Bill with regards to the future financial viability of council housing. Information from the Impact Assessment into research done by the Department for Communities and Local Government reveals that the national council housing revenue account will not be viable in the long-term. The full research has not yet been made public. However our own financial modelling confirms this trend. There is a strong case for reforming the whole Housing Revenue Account subsidy system.


Means-Testing, Profit and Deregulation

Key Proposals

3. The Bill creates the Office for Tenants and Social Landlords (OFTENANT) - a new regulator which will take over the Housing Corporation's regulatory functions for Registered Social Landlords. Councils are specifically excluded from the Bill but over the next two years, an advisory panel is to assess how councils can be included.

4. It provides a new definition of 'low cost' housing.

"68 Low cost rental Accommodation is low cost rental accommodation if-

(a) it is made available for rent, (b) the rent is below the market rate, and...(c) the accommodation is made available in accordance with rules for eligibility designed to ensure that it is occupied by people who cannot afford to buy or rent at market rate."

5. OFTENANT will have the right to set, and enforce, standards on:

"(a) the nature of the housing demands to be addressed, (b) the extent to which demand is to be supplied, (c) criteria for allocating accommodation, (d) terms of tenancies, (e) levels of rent (and the rules may, in particular, include provision for minimum or maximum levels of rent or levels of increase or decrease of rent), (f) maintenance, (g) procedures for addressing complaints by tenants against landlords, (h) methods for consulting and informing tenants, (i) methods of enabling tenants to influence or control the management of their accommodation and environment, (j) anti-social behaviour, (k) landlords' contribution to the environmental, social and economic well-being of the areas in which their property is situated, and (l) estate management." (section 173)

6. Profit-making companies will be allowed for the first time to register as social landlords under a lighter burden of regulation.


7. Anew definition of 'social housing' is set out in the Bill which is intended to subsume council housing with housing association rented housing under the term 'low cost rental accommodation'. Means-testing according to income is included in this definition. This is exactly what the Smith Institute (Rethinking Social Housing, 2006) and others have been demanding, but goes against the fundamental founding principles of council housing that were based upon local authorities providing first class, well designed and well built housing for all sections of society - not housing of 'last resort' for those who could not afford anything 'better'. Professor John Hills reported that in 1979 "20% of the richest tenth lived in social housing" (page 45, Ends and Means, Feb 2007). This proposal would formalise the tendency in recent years for council estates to concentrate deprivation and add to the further stigmatisation of council housing when tenants - and government supposedly - want to promote council housing as a tenure of choice. In addition there are concerns that 'below market rent' (which could be 1 a week below!) should be used as a standard for affordability.

8. Consultation of tenants. On all policy matters including the setting of standards, the regulator is only required to consult "one or more bodies appearing to it to represent the interests of tenants" (eg section 109(6)) There are issues regarding whether any organisation claiming to represent the interests of tenants is made up of actual tenants, is genuinely independent of government and is democratically accountable to tenants and not merely appointed or dominated by professional consultants, facilitators, etc.

9. Tenant Empowerment. The fundamental objectives of the regulator include "to ensure that tenants of social housing have the opportunity to be involved in its management." (section 86(4)) There is an opportunity to also ensure that tenants are enabled to organise independently for the purposes of holding their landlord to account, and improving their housing services, conditions and amenities. This would require funding by the HCA, Oftenant or landlords for independent tenant organisation run by tenants at local level.

10. Democracy. The right to set standards (including rent policy) is to be given to an unelected quango. Council tenants already have many rights and standards set by democratic means and these should not be taken over by an unaccountable body.

11. Transfer of management without consent. Council tenants at present have the right that the management of our homes cannot be transferred without consultation and without the express consent of the Secretary of State, (as in setting up ALMOs). The Bill proposes allowing the regulator to forcibly transfer management or even ownership to another organisation; without any obligation for consulting all tenants, for a ballot of tenants or even for consent by the Secretary of State. There is an opportunity to ensure that tenants are fully involved and consulted on proposals, by insisting on a ballot of tenants before any proposal drawn up by the regulator can be carried out. This would give equal rights to tenants of RSLs as to tenants of councils.

12. The regulator has virtually complete control over the criteria for registration (section 109), unlike the present system where the Housing Corporation can only register a landlord whose main objects are the provision of housing (Housing Act 1996, part 1). RSLs have been lobbying for some time to be freed from the rule whereby at least 51% of their activities have to be providing social housing - but this is hardly good for tenants.

13. Profit-making landlords. Profit-making RSLs will have much less regulation - they will not be required to provide the same levels of information or to comply with the same standards of financial management; the regulator will have no power over their governance arrangements; and they will be exempt from the safety net that if they get into financial trouble homes must be transferred to another registered provider. (sections 123, 124, 134, 135, 157, 162, 174, 187, 231) It is not clear what kind of tenancies profit-making providers will be required to offer - whether tenants will even have the minimum protection provided by an assured tenancy. As the regulator is to set 'terms of tenancies' it could be that this vital protection for tenants is in the hands of a quango rather than the law.

14. It is outrageous that the government is proposing on the one hand to give social housing grant (public money) to profit making companies with so little protection for either tenants or taxpayers; and on the other refusing to give grant to councils.


Funding Existing Council Housing

Key Proposals

15. The bill enables whole authorities to be excluded from the Housing Revenue Account (HRA) subsidy system, making it possible for councils to become self-financing. The bill as drafted would allow the Secretary of State to make an individual agreement with each council. However the Impact Assessment of the bill sets out the basis on which the government intends to use this clause.


(see also paragraphs ... - ... below for further detail on council housing finance)

16. The Impact Assessment of the Bill says that "The principle of self-financing is fiscal neutrality with the current HRA subsidy system...It should be noted that, based on the modelling work done by the six authorities, a settlement at this NPV would not be viable for most councils. This settlement would create an opening debt level within those councils higher than could be supported by their income" (page 44).

This is the first time in which the government has acknowledged that the present national HRAsubsidy system will in the long-term leave the majority of councils financially unviable. It adds considerable weight to the case for reforming the whole system made by, amongst others, the Audit Commission 'Financing Council Housing' 2005.

17. There is an opportunity to consider the details which ought to be in any opt-out agreement between the secretary of state and local councils. Councils should not be expected to leave the protection of the national HRA and face the consequent exposure to risk, without adequate funding. Using the same assumptions as are used when calculating the valuation for transfer associations would be equitable and fair and would safeguard a long-term future for council housing.

18. Allowing councils to opt-out of the Housing Revenue Account, whether for new properties or for the whole of their stock is problematic in comparison with reforming the whole HRA. The government is aware that allowing some councils to leave the HRA is likely to have an adverse effect on those left in; the making of adhoc agreements over a period of time will make it more difficult to ensure fair treatment.

19. It is positive that the government has recognised that councils need to be able to retain 100% of rental income in order for new build to be financially viable (see next section). This principle needs to be applied to existing homes to enable councils to manage and maintain them to sustainable levels. Allowances for management and maintenance need to be funded at 100% of need, as defined by the Building Research Establishment ('Estimation of the need to spend on maintenance and management in the Local Authority housing stock', June 2003)


Building New Council Housing

Key Proposals

20. The same part of the bill enables particular properties to be excluded from the Housing Revenue Account (HRA) subsidy system. This will exempt councils from including new-build homes in the subsidy system and therefore allow them to keep all the rents.

21. However, although legally they are now allowed to, the government is explicitly refusing to make Social Housing Grant available to councils unless they set up ALMOs or Special Purpose Vehicles. It is estimated that councils will be able to build only 2,500 homes a year (compared to 300 at present) with the change to the subsidy system but without access to Social Housing Grant. (Impact Assessment, page 58)


22. Councils wanting to build new homes will be given a false choice. Either they will have to set up a separate company (ALMOs or special purpose vehicles) to build the homes - in which case they will be entitled to grant. Or they can build real council housing - secure, affordable, public housing directly managed by an accountable local authority, with secure tenancies - but must bear all the cost themselves. This is pure discrimination. There is no financial reason for it as the borrowing of ALMOs and SPVs is public 'on-balance-sheet' borrowing. It is a return to the dogmatic insistence on separation of functions which has been shown to mean nothing but a loss of accountability.


Homes and Communities Agency

Key Proposals

22. The Bill establishes a new quango, the Homes and Communities Agency (HCA). The HCAwill merge the grant-giving function of the Housing Corporation with English Partnerships.

23. It is likely that decisions over the funding of Decent Homes for councils is to be transferred from the Department of Communities and Local Government to the Homes and Communities Agency.


24. Although it is not explicit in the Bill, the government has said that the Homes and Communities Agency will take over a lot of the decision-making on councils' Decent Homes programmes ( ) This is likely to mean decisions on the allocation of money for ALMOs, PFI credits and gap funding for stock transfer.

The government's Impact Assessment for the bill talks explicitly about the HCA having a role in the 'regeneration' and 'upgrading' of existing housing (p33). Moving decisions of this kind from the government to a quango means a loss of accountability.


Fair and Balanced Debate

Key Proposals

25. The bill gives for the first time a new statutory right to a ballot for stock transfer but this is accompanied by a draconian restriction on tenants' right to protest at an undemocratic ballot.

26. The bill includes the right for tenant groups to force their council landlord to carry out a ballot on transfer.


27. The bill makes it mandatory to hold a ballot on any stock transfer proposal and states that the Secretary of State must have regard to the ballot; but does not specify in what sense the outcome should influence his/her decision - for example, what the proportion of tenants voting Yes must be to result in approval for the transfer; what effect the turnout for the ballot should have on the decision.

28. Tenants' right to protest at an undemocratic ballot is to be reduced. Tenants will only have 28 days to put in objections to the Secretary of State, and any objections after that period will be disregarded. Since tenants do not have the resources which councils and landlords have this will place a well-nigh impossible burden on tenants which will effectively stifle democratic protest and opposition, and will encourage councils and landlords to be even less democratic than they are at present.

29. There is an opportunity to ensure that the principles of a fair and balanced debate as suggested by the House of Commons Council Housing Group are adhered to in stock transfer consultations. This would actually have a positive effect on the disgraced reputation of the ballot process.

30. This legislation will make tenants vulnerable to predatory landlords looking to cherry-pick estates in areas where land carries a high value. The bill reintroduces the 'Tenants Choice' agenda around Housing Action Trusts (HATs) in 1988. Tenants will be offered improvements to win support for building private housing on their community facilities and green spaces. What safeguards need to be in place to ensure that tenants have genuinely initiated a proposal for a change in landlord, and that this was not first proposed to the tenant group by a prospective new landlord or other interested party (eg consultants)? What safeguards need to be in place to ensure that tenant groups making these requests are democratically accountable to and representative of all tenants in the area to be affected?


The Future Funding of Council Housing

Government robs tenants rents - and the robbery is getting bigger

31. Figures obtained by the House of Commons Council Housing Group have revealed that government took 24 billion out of tenants' rent accounts between 1994 and 2003. And the robbery is set to get worse.

32. We paid 60 billion in rent during 1994-2003, but councils were only given allowances of 36 billion to spend on the management, maintenance and major repair of our homes. A difference of 24 billion. (PQ Answer 0435 0436 06/07).The government's latest Subsidy Determination shows that things are just as bad now, and getting worse. In 2007/08 the difference was 1.7 billion and in 2008/09 the difference is set to rise again to 1.8 billion - although there are less homes.

33. The graph below shows the difference between rents and allowances per home over the last 14 years. In 1999-2000 - when 'Daylight Robbery' was at its height - the difference was 916 per home. Tenant protests at this unfair treatment forced the government to introduce the Major Repairs Allowance - and the difference dropped to 458. But since then it has been steadily climbing until in 2008/09 it has now risen above the 2000 level to 924.

34. Government is forcing our rents up through 'rent convergence' with housing associations but not even allowing councils to keep the extra income! Management and maintenance allowances are only 51% of the level of need that the government's own research calculated they should be (see 'Bring M&M Allowances up to the level of need', below)




35. See for details

36. And this situation is predicted to get a lot worse. The financial projections done by the six authorities on the 'self-financing' pilot scheme has revealed:

37. "the likelihood of a national surplus developing over the next few years, which could amount to billions of pounds. This would be real daylight robbery, or should we call it a con? Whatever slogan is appropriate, it is intolerable that we drift into a position where council tenants are paying an extra tax, without any debate or indeed anyone even admitting that it is happening" John Perry, Chartered Institute of Housing national policy officer, (Inside Housing, 23/11/07)

38. The government itself has been forced to admit that the Housing Revenue Account subsidy system is not viable - for the majority of councils! The official Impact Assessment of the new Housing Bill concludes:

39. "Self-financing local authorities would have a one-off adjustment to their HRA debt, based on the net present value [NPV] of anticipated future payments into or out of the HRA subsidy system....It should be noted that, based on the modelling work done by the six authorities, a settlement at this NPV would not be viable for most councils. This settlement would create an opening debt level within those councils higher than could be supported by their income."

40. It is wrong in principle that council tenants should be subsidising the general taxpayer or subsidising private landlords and home ownership schemes. And it is an outrage that the Treasury, whilst taking this surplus, is starving our homes and estates of investment and then blackmailing council tenants to accept privatisation.

Funding the 'Fourth Option'

41. There is no shortage of concrete proposals on how government could fund the 'Fourth Option' - both to help bring existing homes up to standard where tenants choose to remain with the council; and to ensure a long-term sustainable future for council housing.

Investment Allowance

42. In 2004 the Local Government Association and unions put forward a proposal that 'good' performing councils should be able to access the extra money available to ALMOs direct. This would not cost a penny more in either cash or borrowing terms than ALMOs. The then Deputy Prime Minister, John Prescott, accepted this idea in principle in discussions leading up to the 2004 Labour Party conference. Treasury officials endorsed the proposal so long as extra public money was clearly linked to 'good' (two star) performance. Our suggestion of a 'Continual Improvement Task Force' would help authorities with less than two stars access extra investment.

Ring-fence tenants' rents

43. The Labour Housing Group issued its own proposal for a "Retained Management Option" based on the principle of ring-fencing the extra money raised through rent convergence. In 2006 they identified that government would be taking an additional 600 million per year in rent from council tenants that could provide 'headroom' to support Prudential borrowing as an alternative to privatisation.

Bring M&M Allowances up to the level of need

44. The government's own research, carried out by the Building Research Establishment, showed that in 2001-02 Management and Maintenance Allowances should have been 5.5 billion when in fact they were only 3 billion. Factoring in inflation since 2001-02 and the number of homes shows that allowances would need to be 6.6 billion today to meet the level of need. They are only 3.4 billion. Housing consultant David Gibson has produced a report showing how the level of need could be reached by 2010/11 (Sustaining Council Housing, Nov 2007) He argues that ring-fencing the extra money generated by rent convergence would help towards meeting this and any extra cost to government in the short-term "would be reasonable and fair as repayment of some of the rent money siphoned off from tenants (between 1994 and 2004) to fund rent rebates as negative housing subsidy. It is also reasonable since, as has been shown only a fraction of right to buy receipts... has been reinvested in council housing."

Write off Debt

45. The Audit Commission report (Financing Council Housing, July 2005) described existing housing finance rules as "perverse" and argued that the current system is not equitable. The report recommended that "the government should review the council housing subsidy system" and addressed the issue of the small number of authorities with high levels of debt, recommending "giving a specific focus on solutions for those authorities that currently rely heavily on the system."

46. There is no justification for discriminating against councils who retain their homes by making debt write-off conditional on stock transfer. "Writing off debt owed by local authorities to central government has no effect on the financial position of the public sector as a whole, or on any of the fiscal aggregates." (Parliamentary Question answer, 19/01/06)

The Money's There

47. There are plenty of places the government could find money from to improve council housing and meet its manifesto commitment:

48. "receipts from the Right-to-Buy sales of council housing that have yielded around 45 billion - only a quarter has been recycled into improving public housing;" (Joseph Rowntree Foundation 01/12/05).

49. Stock transfer has produced 5.86 billion 'Total Transfer Price' which should be reinvested (UK Housing Review 2005/2006).

50. Council rents are set to rise via 'rent convergence' but "Tenants face paying an 'extra tax' because the council housing finance regime is likely to go billions of pounds into surplus...rental increases will dramatically outstrip the amount of money... to manage and maintain their homes" (Inside Housing, 16/11/07)

51. Government is offering subsidies for various 'affordable' home-ownership schemes which most people simply can't afford. Only 88 people have taken up the 'Social Homebuy' scheme for example [ref]

52. The savings on the extra housing benefit bill which will otherwise be caused by transferring homes into the RSL sector "public spending on bricks and mortar subsidy for council housing [fell] from 5.6 billion in 1980/81 to just 0.2 billion in 2002/03... Over the same period of time total expenditure on housing benefit rose from 2.7 billion in 1980/81 to 8.6 billion in 2002/03" (UK Review 2005/2006).



What we're fighting for


The Urgent Need for Third Generation Council Housing


53. The first generation of council housing was the response to the Victorian slums, the second as the result of the Blitz. It's time for the Third Generation.


54. "The threat of tenants' organisation and the impact of the 1917 Russian Revolution in Britain made wartime Prime Minister Lloyd George deliver 'homes fit for heroes' in the 1919 Addison Act. One civil servant put it bluntly: 'The money we are going to spend on housing is an insurance against Bolshevism and Revolution.' All councils had to build housing for rent, and the government gave them central subsidies.In 1939 a nationwide tenants federation was launched - when war came the government immediately froze all rents - just in case!" (John Grayson, 'Tenants, Histories and Movements', in 'The Case for Council Housing in 21st Century Britain', DCH 2006)

55. Rent strikes and industrial unrest before and during the First World War won the highly controversial imposition of rent controls in 1915. Tenants and trade unionists went on to organise to demand 'municipal' housing as an alternative to Victorian slum landlords. The 1919 Addison Act put council housing on the map.

56. Many of the 'Homes fit for Heroes' have stood the test of time. The Boundary Estate in Bethnal Green is beautifully designed and laid out. In 2006 87% of tenants rejected privatisation and voted to keep the council as their landlord. There are many examples of well designed, well built, spacious council homes, often with gardens, that have provided secure, affordable housing for millions.

57. The second generation of council housing was built within a cross party consensus to tackle housing demand after another crisis - the Blitz. Tory and Labour governments understood that the private sector would never be able to meet post-war housing need and out-bid each other with promises to build the most council homes. Sadly, this emphasis on quantity, coupled with the building industry's drive for maximum profits, led to some of the poor design and construction that has damaged the reputation of council housing.

58. A generation later, free-market housing policies are damaging the lives of millions. Council housing lists continue to grow and with house prices up to ten times average wages, the 'dream' of homeownership is a fantasy for many. Years of under-investment in council housing have left many estates in poor condition and rising rents mean that the Housing Benefit bill dwarfs housing investment. The 'credit crunch' has brought one British bank to its knees and now threatens not only the housing market, but the whole economy.

59. Another housing policy is possible: one that provides the first class, secure housing that working people need at a price they can actually afford. Using public land for public housing makes economic sense: savings in temporary housing costs alone would make building council housing value for money. The benefits in improving health and education as well as tackling other social problems are overwhelming.

60. Meeting real housing need requires proper planning and its local councils who have the local knowledge, expertise and commitment. Above all, local councils are publicly and democratically accountable.

61. We don't have to repeat the mistakes of the past. Tenants and those in housing need demand real, planned investment in public assets that will give value for generations to come, just like council housing has done for the last 100 years. We need homes that are well built, affordable, secure and democratically controlled. It's time for a third generation of council housing.

The History of Council Housing

62. In 1945 poor housing was one of the five great evils identified by Beveridge, and Nye Bevan put the right to a home to rent at the forefront of government policy. The post war council estates between 1945 and 1951 under Labour were planned as a right, high quality rented housing for all sections of the community - just like free schooling, free health care, full employment. Bevan described his ideal council development as a village with a cross section of classes and wealth.

63. "Even in the face of massive shortages of both labour and materials Bevan managed to push up the council house-building programme to 227,000 in 1948 and 'pushed up the old minimum standard for council housing from 750 square feet to 900 with lavatories upstairs and well as down...' Bevan's policy was to restrict severely private housebuilding, allowing only one private house for every four built by local authorities, to order local authorities to requisition empty houses and derequisition those it had taken over as offices, to toughen rent controls, put first priority on repairs to unoccupied war-damaged dwellings, and charge local authorities with the task of building...He persuaded Dalton.... to treble the subsidy for council housing" Nicholas Timmins 'The Five Giants - A biography of the Welfare State' Fontana 1996

64. In 1968 31% of council tenants were from the poorest 30% of households nationally, 46% from the richest 50% of households. They were a cross-section of working class and professional middle class families: teachers, social workers, professional and white collar workers of all kinds. Council housing was now in 1978 at its all time high, nearly a third of housing (32%). In 1979 councils were still housing in rented accommodation 20% of the richest tenth of the population. Balanced, sustainable council housing.

65. In 1968 the Greater London Council started a 70% three year increase in council rents. 20,000 tenants demonstrated in Trafalgar Square, and 11,000 families went on rent strike. Attempts to force private market rents on council tenants and the Housing Finance Act of 1972 provoked a wave of protests. Thirty council areas witnessed massive protests - in Kirkby in Liverpool tenants were sent to prison, 15,000 went on rent strike in Dudley. The growth and militancy of tenants' federations and national organisations forced government in a 1979 Housing Bill to give council housing secure tenancies for the first time.

65. The 1980 Right to Buy dramatically changed the social mix of tenants renting council housing. Over half the council stock was literally given away and it became the biggest single privatisation of the Thatcher era - bigger than water, gas or rail. Housing expenditure was cut between 1979 and 1985 by 55%. Subsidies to council tenants were cut by 31% 1979 to 1985; subsidies to owner occupiers were increased by 212%. By 1986 60% of tenants were from the poorest 30% of the population, 18% from the richest 50% - almost an exact reversal of 1968 figures.

66. The 1988 Housing Act introduced 'Tenant Choice'. Any private company could register as a landlord and then organise a ballot on an estate and persuade the tenants to transfer to them. In the face of major opposition from council tenants, the proposals were subsequently repealed.

67. Since then determined campaigning by council tenants has won several concessions - the introduction of the Major Repairs Allowance, the end of the 'Daylight Robbery' system of using tenants' rents to subsidise Housing Benefit, and the introduction of Prudential Borrowing.

68. In 2000 the government launched a big drive to privatise the remaining council homes through stock transfer. Pundits predicted the 'Death of council housing'. Determined resistance by tenants led to an attempt to break the campaign by the introduction of the 'ALMO' formula. But despite the dire predictions there are still over 2.5 million council tenants across the UK, with over 120 authorities directly managing their stock, and millions more who want a council home.

Independent Tenants Movement not Consumer Panels

69. There used to be a strong and active tenants movement in most parts of the UK. Tenants Federations sprung up to co-ordinate Tenants Associations within a local authority area which in turn sent delegates to national meetings and debates.

70. But in the 1990s a whole new industry of 'Tenant Participation' was encouraged by government to wrestle control of tenant organisation. Under the guise of 'empowerment' tenants organisations were sanitised and new forums and panels created. Instead of open debate they want to give us tenant directors gagged by confidentiality clauses and overcome with business plans, missions and visions. So called 'tenant representatives' end up spending more time with government officials than organising meetings with tenants.

71. Now they are proposing to set up a national 'consumer panel'; and saying that the regulator will only have to consult that panel and can ignore the rest of us! It's not on.

72. But there are encouraging signs around the country of more tenants turning against this controlled Tenants Participation bandwagon. Again we're starting to organising ourselves into the kind of independent tenants organisations that we'll need to fight off the latest threats.

73. If we are to succeed we'll have to ignore the flattery and refuse the seductive offers of funding if conditions that restrict our democratic rights to organise and say what we want are attached. We expect and demand that, however we organise ourselves, our landlords hand over funds from our rents to finance our independent tenants movement, with no strings attached.



Independent Inquiry of MPs into Housing Bill

Statement by Austin Mitchell MP, chair, HOC Council Housing group

74. "Government has introduced a new Housing and Regeneration Bill. This provides an opportunity to secure changes so councils can improve existing, build new and maintain all council housing as first class housing for years to come.

75. Our opponents seek to means test 'low cost rented housing', give predatory landlords opportunities to buy council estates, transfer key decisions from Ministers to new quangos and break up the national Housing Revenue Account - without putting in place guarantees for all councils.

76. Tenants, trade unionists and councillors need to organise now to make sure we get the right result!

77. The Bill, as it stands, continues the discrimination against council housing. Profit making landlords can apply for Social Housing Grant. But councils cannot unless they set up arms length companies. Why?

78. Councils are being cajoled and bribed to put public land into public/private partnerships (Local Housing Companies) that will build private - not council - housing.

79. The official 'Impact Assessment' also admits the present housing finance (HRA) regime is unsustainable. (see page 2)

80. This all falls a long way short of the 'warm words' for council housing we heard over the summer from Ministers, would-be Deputy Leaders of the Labour Party and the Prime Minister himself.

81. We desperately need more homes - it is shocking that so many people are living in appalling housing need. The private sector can't deliver. They never have before - why should they now? So government must invest in first class council housing to provide quality housing - not rabbit hutches; secure homes protected against eviction; and actually affordable (not just labelled as such).

82. The obsession with home ownership is not the solution. Only 15% of those accessing public subsidies were from the priority groups of council or housing association tenants. Government must direct public subsidies to invest in a strong public (council) housing sector for those who don't want or can't afford to buy, to provide a real alternative for those in temporary accommodation, facing chronic overcrowding and for young adults trying to move out from under their parents' feet.

83. Three Labour conferences have backed the demand for the 'Fourth Option' and Ministers only avoided a fourth consecutive defeat in September by scrapping votes at the conference!

84. Against us are those who clearly want to get rid of council housing, proposing means testing and time-limited tenancies in their war on 'dependency'. This is nonsense.

85. In 1979 '20% of the richest tenth lived in social housing' (Prof. John Hills, Ends and Means, Feb 2007). Today 'people queuing up to be council tenants are not all poverty stricken and with multiple other problems' (Roof magazine, Shelter, May/June 2007). The 1.6 million households on council housing waiting lists include butchers, bakers, teachers and nurses who want a first class secure council home with lower rents and an accountable landlord. Investment in council housing can satisfy their need and, in the process, make estates the 'mixed communities' they used to be.

86. There is nothing in the bill to stop government siphoning money from tenants' rents and capital receipts. There should be. This would enable councils to fund much-needed repairs, respect the choice of their tenants, and provide new homes for those who need them.

87. Without these changes over 200 authorities face the continuing threat of privatisation: those who have decided to retain their stock, those with ALMOs and those yet to decide. That's not on.

88. Tenants, the trade union movement, councillors and MPs across all parties as well as increasing number of housing professionals and academics support the call for the 'Fourth Option'. This Bill is an opportunity for government to meet their expectations. Help make sure they take it."

Early Day Motion 368 'Investment in Council Housing'

89. "That this House welcomes the Government's new commitment to tackle housing needs; believes that this must include a first-class council housing sector providing secure tenancies, with lower rents and charges and a landlord whom tenants can hold to account as an alternative to ownership and the private housing market and that to achieve this Government must introduce changes to local authority housing finance to enable all local authorities to bring their existing homes up to modern standards, start a new council house building programme and maintain existing and new council housing as first-class housing in years to come; and actively opposes both the stigmatisation of council housing as housing of last resort and proposals to means test or time limit secure tenancies so that local authorities can respect the choice of existing tenants who want to keep the council as their landlord and get their homes and estates improved, house the wide range of people on council housing waiting lists and so return council estates to the mixed communities they were before shortage distorted allocations policies and concentrated deprivation."

Details of Inquiry

90. House of Commons Council Housing Group

MPs Inquiry into the Housing Bill

Tuesday 22nd January 2008

House of Commons, Westminster (St. Stephen's entrance)

Give evidence from 11.00am - 6.00pm

Rally with speakers 2-3pm and 6-8pm


91. The House of Commons Council Housing Group of MPs is holding an inquiry to gather evidence from tenants, trade unions, local authorities, housing professionals and academics to support amendments to the Housing and Regeneration Bill. The MPs are calling on supporters of council housing to submit formal written evidence and to apply to provide oral evidence and answer questions at Parliament on January 22nd.

Evidence sought

92. Evidence is sought from local authorities, tenant groups, trade unions, housing professionals, academics

93. Changes to the present HRA subsidy system (locally and nationally) to enable authorities to improve existing, build new and maintain all council housing as first class housing for years to come;

94. Financial modelling by local authorities showing the benefit/loss to their HRA from breaking up the national HRA on financially neutral terms; retaining all rental income and capital receipts; debt write-off on equal terms available on transfer; increasing M&M to 100% of need;

95. Means-testing and its effect on sustainable communities - particularly welcome will be statistical information from local authorities on historic and current demographic analysis of council tenants and those on waiting list, the effect on allocations policy from reduction in supply, and estimates of what level of new council housing provision would make communities mixed and sustainable again.

96. Proposed 'Tenants Choice' ballots

97. OFTENANT and its possible application to council housing (consultation, tenant empowerment, policy-making such as rent levels, and accountability).

98. Providing Social Housing grant to profit-making landlords and local reaction to withholding SHG from councils retaining the direct management of their homes; the effect this is likely to have on security, affordability and value for money for the taxpayer.

HOC Council Housing Group recommended code of practice for fair and balanced debate

99. The House of Commons Council Housing Group held an inquiry in 2004-05 and produced a report 'Support for the Fourth Option for Council Housing'. They recommended:

100. "To make choice a reality for tenants government has to provide a level playing field between the different options available and guarantee a 'fair and balanced debate' before tenants make a decision by a formal ballot. The government should... produce guidelines for local authorities and a clear code of practice that insists on a fair and balanced debate so that tenants hear both sides of the argument including:

101. The right of tenants to choose between all of the options and for these options to be factually presented (not 'more investment' v 'stay as you are');

102. Any proposal/process to change from one option to another should be tenant led;

103. Public access to all the relevant information (financial information, stock conditions reports, address lists of all those entitled to vote);

104. Equal access to meeting halls and other facilities to allow the fullest possible debate;

105. Tenants are given one clear month's advance notice of when the ballot will start and finish and this timescale will be strictly adhered to;

106. Tenants receive material putting both sides of the debate and a commitment that council staff will not be instructed to selectively take down material on estates opposing the proposal;

107. A financial limit on the overall cost of consultation to ensure the maximum resources are spent on improving tenants' homes."


December 2007