09 May 2008
MPs are being urged to back a local authority campaign to tear up the controversial housing subsidy system.
With the Treasury expected to keep £194m of the money councils raise in rents this year, 60 authorities have joined forces to demand that ministers make urgent changes.
Paul Wenham, deputy chief executive of Waverley Council in Surrey, said MPs should focus on the anomalies of the housing revenue account in the same way as they protested against the abolition of the 10p tax rate.
'The poorest people in the community are subsidising other people in needy positions across the country,' he said. 'What sort of tax system works like that?'
Along with about 80% of councils, Waverley pays more into the HRA than it receives back and this year expects to lose nearly £11m. As council rents have risen, the government is raising more money than it needs to pay for housing repairs — so leaving the Treasury with a healthy surplus that is forecast to continue rising.
The local authority campaign involves shire districts and metropolitan boroughs, including some with arm's-length management organisations for housing.