Prime Minister David Cameron has announced that the government will increase the discounts offered to council house tenants to buy their homes as part of a plan to boost construction of new homes.
Cameron announced on the first day of the Conservative Party conference yesterday that the government would also release land it owns to be used to build homes.
These actions together would provide thousands of jobs in the building industry with more houses being built, he said.
The plan aims to make the right to buy scheme, introduced by the Thatcher government in the 1980s, attractive again, the government said.
The cash raised by an increase in council house sales, most of which will be retained by the Treasury, will be used to build 100,000 homes that will then be rented out.
Cameron said that this would create 200,000 jobs in the construction industry, adding that the release of government land for house building would create a similar number of homes and jobs.
More details of the precise level of discount increase will be provided by the government's housing strategy, which will be published later this autumn. But the Department for Communities and Local Government has published some details on the scheme, which it said will rejuvenate the housing stock.
Currently, discounts for council house purchases vary, starting from between 35% for houses if the tenant has been renting for five years, to 50% discount for the same tenancy in flats. However, the Labour government put in place a cap on the total discount, which the DCLG report said ‘resulted in fewer people being able to take up this opportunity’.
The question and answer report states that under the new plan a new affordable home will be built for every one bought under right to buy. These homes will be additional to the government's existing plans, which propose that 150,000 new homes will be built by 2015.
The DCLG report also states that the government's reforms to the Housing Revenue Account system, which will give councils take control of their own council house rents, would remain unchanged by the proposals. 'We will ensure councils keep the proportion of the receipts needed to cover the debt associated with any property sold to ensure that each business remains viable,' the report stated.
