Is it the end of the honeymoon for Almos

22 Jan 04
Six months ago, Salford City Council was on the verge of setting up an arm's-length management organisation to help it meet the decent homes target by 2010.

23 January 2004

Six months ago, Salford City Council was on the verge of setting up an arm's-length management organisation to help it meet the decent homes target by 2010. It created a virtual, or shadow, Almo, New Prospect Housing, to manage landlord services, and submitted an expression of interest to the Office of the Deputy Prime Minister. But when the deadline for fourth-round Almo bids passed on December 31, Salford's name was missing.

The council had decided to think again, recognising that its Almo stood little chance in the near future of gaining the two Audit Commission stars needed for extra government funding.


Further consultations are planned, which could lead to a stock transfer or a variety of solutions in different parts of the borough.


'We must be realistic in any bid for government funding,' says Peter Connor, the council's lead member for housing.


Salford is not the only local authority having second thoughts. Five of the 19 councils that had expressed interest in joining the fourth-round programme failed to submit firm bids.


In the London Borough of Camden, 77% of tenants voted against an Almo. Defend Council Housing, which until now has concentrated on opposing transfers, campaigned fiercely in the borough, claiming that Almos amount to two-stage privatisation.


DCH spokesman Alan Walter says the result has sent shock waves through the ODPM and local government. 'It gives an enormous boost to the confidence of tenants and trade unionists resisting similar blackmail.'


The government has pledged almost £2bn for Almos by 2005/06 and, despite recent events, most of this will still be taken up. But the Camden result has led to serious questions about whether the honeymoon period is finally over.


Yet, just a few months ago, everything seemed to be going well. Almos, created by Labour as an alternative for councils that opposed transfer, looked a certain winner. All eight of the first-round Almos and almost all of the18 in the second round gained at least two stars.


The first setback came in Leeds, the first council to split its housing between more than one Almo. Two of these achieved just one star and need to be re-inspected before they can receive any funding.


West Lancashire expressed early interest in both an Almo and large-scale voluntary transfer (LSVT), but decided in December to go for transfer. Wear Valley, which was also expected to join the fourth round bids, is carrying out further consultations.


Michael Laing, director of housing services in Wear Valley, said the council was aware of events in Camden but this did not account for the delay. The authority was following new ODPM advice and 'front-loading' consultation with tenants. 'Extending the period of consultation has prevented us from putting in a bid,' he says.


On January 14, Camden representatives visited housing minister Keith Hill at the ODPM to discuss what to do next. The council already has three stars and believes that it should have the £282m it was promised without going through the Almo process. The mood of the meeting was described as pessimistic, with the government unwilling to release the money before the Almo is in place. But, as council leader Dame Jane Roberts explained in a letter to Hill the same day, Camden is not the only one with a problem.


'I would suggest it leaves the government with a problem also,' she said. 'We cannot achieve the decent homes standard in line with your policy, despite having done all we possibly could to secure the investment so desperately needed in our homes.'


The National Federation of Almos is hoping that Camden is a 'one-off' and denies things have gone pear-shaped. Gwyneth Taylor, NFA policy officer, says there is no truth to claims that homes managed by Almos will eventually be sold off to other landlords. 'Most local authorities and tenants go for Almos because they don't want privatisation,' she says.


Even with the number of councils in round four down to 14, there could still be 800,000 homes run by Almos by 2005/06 roughly the same number as transferred to housing associations through LSVTs since 1988.


Much will depend on when the long-awaited consultation paper on giving Almos extra borrowing powers finally appears. Originally promised last summer, it has still to emerge from the ODPM.


There is also the question of how much cash the government devotes to Almos in the next Spending Review.


Sarah Webb, director of policy at the Chartered Institute of Housing, hopes the Treasury comes up with the money as it did two years ago. 'To withdraw [Almos] would be quite devastating and would send a signal to local authorities that all their hard work has not been worthwhile,' she says.

PFjan2004

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