Housing associations and the Right to Buy Contents

1Introduction

1.Since 1980, tenants in council-owned homes have had the right to purchase their home at a discounted rate (the Right to Buy (RTB)). In 2015, the Conservative Party’s Manifesto made a commitment to extend RTB to tenants of housing associations. In the Queen’s Speech in May, the Government made a commitment to introduce legislation to “support home ownership and give housing association tenants the chance to own their own home”.1 There are 1.3 million housing association tenants who will be able to purchase their home under the policy and the potential impact on housing associations is significant. Other Government proposals, such as a 1 per cent annual reduction in social rents for four years and a ‘pay to stay’ policy that would require higher earning tenants to pay an increased rent, would also change how housing associations work. We wanted to explore how housing associations, and the services they provide for their tenants, would be affected, as well as how the overall supply of affordable housing might change in the context of a severe national housing shortage and the difficulties that many people face in accessing stable housing. We were keen to find out whether the ability of housing associations to build and develop would be improved or harmed by the Government’s proposals. We also wanted to explore how the policy would be funded. The Government had announced that high value council homes would be sold with the proceeds being used to fund the RTB discounts as well as replacement homes for those sold. We therefore investigated whether this funding model was sufficiently robust, and what effect it would have on overall social housing provision.

2.We launched our inquiry in July 2015. We invited written evidence from interested parties over the summer and received 176 written submissions, including many from housing associations concerned at the potential consequences of the proposals.

3.At the National Housing Federation’s (NHF) conference on 24 September 2015, the Rt Hon Greg Clark MP, Secretary of State for Communities and Local Government, announced that an agreement had been reached with the NHF, the principal representative of the social housing sector. This agreement involved the extension of RTB to housing association tenants on a voluntary rather than a statutory basis.

4.Following the announcement of the proposed voluntary deal, housing associations were given a little over a week to vote for or against the proposals. Our oral evidence sessions therefore started at a time of uncertainty. Throughout our inquiry the Government’s policies have been revised and amended as the enabling legislation, the Housing and Planning Bill, has progressed through the Commons. Our evidence sessions have therefore provided an opportunity for public discussion of issues of fundamental importance to the social housing sector.

5.We are extremely grateful to everyone who contributed to our inquiry. The level of interest in our inquiry reflects the significance and scale of the challenges in meeting housing demand in this country and we thank everyone for their contributions. Our investigations were supported by our specialist advisor, Professor Christine Whitehead from the London School of Economics, to whom we are especially grateful. We also commissioned research from Professor Ian Cole from Sheffield Hallam University on the operation and impact of the original Right to Buy, for which we thank Professor Cole and his colleagues.

1 Cabinet Office, Queen’s Speech 2015, 27 May 2015




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Prepared 8 February 2016