As the chair of CIPFA’s housing panel, I was interested in housing minister John Healey’s PF blog, reminding readers of the deadline for the consultation on English council housing funding.
What a pity though that political shorthand was allowed to get in the way of what is happening. The housing revenue account is not being axed – far from it. This bastion of accounting – first brought in before the Second World War – will continue.
What is being axed, if the proposals go through, is the housing subsidy system. This is a notional account based on govenrment estimates of the income and expenditure that each local authority should spend on housing. Any shortfall or excess dictates how much subsidy the government should pay or, for the majority of councils, how much of tenants’ rents local authorities should hand over to government. The HRA, on the other hand, records what councils receive in rent and what they pay for managing and maintaining their properties.
What local government has been looking for is an opportunity to regain control over its HRA income and expenditure so that it can meet tenants’ needs and expectations for the 2 million or so properties that we look after.
The consultation does move us towards this objective, but there are a huge amount of unknowns. One of these appears to be that the Treasury might be asking tenants to stump up £7bn for the privilege of becoming self-funding.
Now that sounds unfair in that we are generally talking about the poorer in society. It doesn’t seem fair that bankers’ bonuses are still being paid, but the deficit on the national account should be paid by those least able to afford it. So we are moving in the right direction but there is many a slip between cup and lip.
Ken Lee
Director of resources,
Wigan & Leigh Housing Co
