Press Release

SHAL HOUSING WARNS OF “GREATEST THREAT EVER” TO LOCALLY-DRIVEN COMMUNITY SCHEMES

SHAL Housing is backing a campaign to protect locally-driven community work, run by housing associations, from interference by central government.

John Thomson , the chief executive of SHAL Housing, has written to his local MP, Ian Liddell-Grainger warning that the Housing Bill, currently going through Parliament, represents the “greatest threat ever” to the ability of housing associations to ensure that neighbourhood schemes are driven by local need, not central direction.

He fears that because the bill gives ministers the right to regulate associations’ neighbourhood work paid for out of their own money various innovative local schemes, could be scrapped as associations inevitably feel compelled to work on the subject areas the Government says are priorities.

John Thomson has also warned that the bill may hit the ability of housing associations to build as many affordable homes as currently expected.

During the past two decades, housing associations have raised more than £35bn of private finance to spend on new and existing homes, in addition to the £30bn that ministers have invested in the sector.

However, this successful funding model is now at risk – as the degree of central control, outlined in the bill, is so great that it could lead to housing associations being reclassified as public bodies by the Office for National Statistics, when it compiles the Government’s accounts.

This would mean they would no longer be able to lever in billions of pounds of private money to match public subsidy, as the borrowing would show up on the public debt, and, in turn, there would be less money to spend on delivering new affordable homes.

In a letter to Ian Liddell-Grainger, John Thomson says: “While we support the Government's new emphasis on housing, we believe the Housing Bill contains a number of key threats that could lead to fewer homes being built and locally-driven community work being scrapped.

“As it stands, the Bill sets out a substantial increase in the level of government control of housing associations.

The Communities Secretary would have unprecedented power to compel housing associations to implement government policy unrelated to housing, through a new regulator. In addition, Ministers would be able to impose regulation on community services provided by housing associations themselves, paid for out of their own money.”