Housing minister seeks to reassure housing associations as he says Burnham ‘unashamedly in favour’ of rebalancing delivery to get ‘councils back in the game’
Housing associations will not lose out as a result of Andy Burnham ‘unashamedly’ wanting councils to deliver a higher proportion of social rented homes, Matthew Pennycook has said.
The housing minister, speaking this morning at the Housing Community Summit in Liverpool, said: “For any housing association or other provider that is concerned about their future in a world in which councils are once again building at scale, let me state plainly that the revival of council house building that this government is working to deliver should complement, not threaten, the contribution you make.”
He added: “The prime minister does want to unashamedly see councils delivering a far higher proportion of social rented homes, but I don’t think that means in any way that housing associations must lose out.”
Pennycook re-iterated that the new government has withheld some money that was originally due to be allocated in the first wave of funding under the £39bn Social and Affordable Homes Programme.
This money has been held back to “prioritise social rent, and in particular council housing.” Pennycook also confirmed the government is exploring allowing “low-cost borrowing options” for local authorities.
The comments came after Amy Rees, chief executive of Homes England yesterday hinted the £2.5bn low-cost loans scheme, which currently is for registered providers only, may be partially ‘re-targeted’ at councils.
Pennycook said: “Direct council delivery of social rent homes does have a range of benefits, including democratic accountability, the ability to tailor provision to meet local housing need, and the creation of public assets that generate rental income, which is reinvested in local housing to support and sustain communities.”
He added: “It’s also simply a fact that the last time we built social housing on the scale that is now required, councils were the driving force.”
Journalist Kirsty Walk on the conference stage said housing associations have greater development capacity than their allocated funding allows, so are “ready to rock” whereas a lot of council housing development departments no longer exist. She asked whether “housing associations will take up the slack now and then give way to councils”
Pennycook said: “We want councils back in the game in a much more serious way. I don’t think that that necessarily needs to come at the expense of housing associations. We need more social and affordable housing delivered by as many partners as we can get, and so that’s why I don’t think people should think of it as that zero-sum game…We genuinely want to encourage greater partnership working.” Pennycook acknowledged that council capacity will be challenging to build up, given council development is currently at an “incredibly low base”.
Earlier in his speech to the conference, Pennycook reeled off a list of Labour’s housing policies since coming to power, including Right to Buy reforms, the £39bn SAHP, the 10-year social housing rent settlement, equal access to government remediation funding schemes for social landlords and the £2.5 billion low-interest loans package.
“The outlook for the sector has been utterly transformed over the past 26 months as a result of the decisions taken by this Labour government,” he said. He acknowledged however times are tough for housebuilding, with viability challenges “affecting every part of the country”.
Pennycook also said “everyone deserves” to have an affordable home. He was speaking a day after Reform deputy leader Richard Tice told the conference, which is run jointly by the Chartered Insititute of Housing and the National Housing Federation, that social housing was an “absolute privilege” as he defended the party’s controversial proposal to evict foreign nationals from social homes.
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