Rent restructuring threatens housing renewal

13 Jul 00
Government plans to restructure rents could significantly reduce the sums available to finance social regeneration, the National Housing Federation warned this week.

14 July 2000

A neighbourhood renewal fund must be set up which, among other things, would compensate registered social landlords that experience cuts in rent income from tenants, the NHF told the Social Exclusion Unit.

Liz Potter, the federation's director of policy, said rent reform was likely to mean that rents fell sharply in areas of falling capital values and low demand for housing – some of which are also areas most in need of regeneration and renewal.

'At the moment rents are high enough for RSLs to draw from the rent pot and keep up programmes with the community to try to reverse decline,' she said. 'Once rents fall, they won't be able to do that anymore.'

Potter stressed the proposed fund would not be solely for RSLs to draw from but pointed out that, as ministers had made it clear that social regeneration would not be paid for using rents, alternative sources of income must be made available.

In its response to the SEU's national strategy for a neighbourhood renewal framework, the NHF warns that housing is in danger of being overlooked.

Jim Coulter, the federation's chief executive, said: 'While the Social Exclusion Unit has been successful in recognising the deep roots of the problems in deprived areas, it has failed to recognise the vital role of housing as part of the solution.'

The NHF identifies 11 'missing links' in the SEU's framework, including a lack of affordable housing and lack of choice in housing markets, the importance of meeting the needs of older people and people in supported housing, and the potential role of independent social landlords in neighbourhood management and renewal.

Last week, the NHF called for more emphasis on affordability of rents. It proposed a 'fourth option' on rent reform, whereby 80% of rents would be based on earnings and just 20% on values.


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