26 July 2002
The new money, announced on July 19 by housing minister Lord Rooker, comes after government research showed large numbers of BME associations will come under 'severe financial strain'.
According to the research, BME associations are more likely to feel the effects of rent restructuring because they are generally smaller than other registered social landlords, are newer, lack an established asset base, and face proportionately higher costs.
There are 64 BME associations in England, owning between them more than 21,000 homes. Most of those facing problems are situated outside London where, unlike in the capital, rents are likely to come down in line with a new formula based on earnings and capital values.
To qualify for assistance, landlords must show that their target rent is more than 10% below the current rent. Support will be in the form of capital payments and will be available over three years from next April. Payments will not be made to associations that are in difficulty because of poor financial management.
Liz Potter, director of policy at the National Housing Federation, said the fund was very welcome and would help the BME sector to expand. 'The negative impact of rent restructuring on BME associations goes far beyond the financial viability of the organisation,' she added.
On July 23, Lord Rooker told a race and housing conference in London that councils and RSLs must focus on the needs of BME groups, which suffer disproportionately from problems associated with poor housing, including crime and poor health.
PFjul2002
