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DECENT HOMES AND DECENT COMMUNITIES PROGRAMME STRENGTHENED WITH NEW BIDDING ROUNDS

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Eight million tenants will be living in better homes by the end of the decade, local government secretary Ruth Kell...
Eight million tenants will be living in better homes by the end of the decade, local government secretary Ruth Kelly announced today. By 2010 the government's Decent Homes programme will have improved 3.6 million homes, with investment of over£40bn.

These new figures were announced along with the next and final bidding round for councils to apply for funding. Councils applying for extra resources from the 2006 housing transfer programme and the final arms length management organisation bidding round have until the end of July to do so.

Ms Kelly said:

'We've made tremendous progress. In 1997 millions of council tenants were living in homes that hadn't been renovated since the day they were built. We've made these homes fit for the 21st century.

'But decent homes on their own are not enough. What is outside the front door matters too.

'We know that radical solutions are needed to transform some of our most deprived neighbourhoods. That means local authorities, and housing associations, harnessing the energy and direction of the decent homes programme and the potential of their assets to create decent communities not just decent homes. Combining funding streams and working with other agencies to really raise the quality of life for all.

'This takes time to get right. It also needs flexibility to allow local authorities to decide what their local community really needs.

That is why I am content to see us move forward, getting as much as possible of the basic decent homes work done by 2010 but recognising that some will take - and must be allowed to take - a little longer.

'So the constraint of 2010 will be relaxed in a limited number of cases for those local authorities engaged in or wishing to pursue major transformations of their estates or where it is clear that we could secure better communities, and so better long term value for money by taking a little longer.'

Ms Kelly also said that in future the government wants decisions on investment in improving social housing to be considered alongside decisions on the other investment necessary to deliver sustainable mixed communities, and not as a separate programme. Local Area Agreements (LAAs) could be a way of doing this.

She also announced the publication of a discussion document calling for innovative new approaches to housing.

'I'm not backing a 'fourth option'. I'm absolutely clear councils must have an important role in delivering housing for communities. The department will work with a number of 'excellent' local authorities and local authorities with three star ALMOs to examine the costs and benefits of operating their finances outside the national housing subsidy system. This approach could improve long term sustainability of investment in housing, as well provide evidence for decisions in the government's 2007 spending review.

'The Decent Homes programme has given tenants a voice. I want to see if we can extend this - in particular I am keen to explore why there aren't more tenant owned housing associations such as those in Preston and Walsall.'

The success of the Decent Homes programme has seen more than 500,000 kitchens and 350,000 bathrooms already improved since 1997.

Notes

1. Ruth Kelly is giving a speech to stakeholders which is available here.

2. Following the announcement, letters will be sent to those stock owning local authorities who have indicated they want to pursue stock transfer or an ALMO inviting them to apply for the 2006 housing transfer programme and ALMO round. The deadline for bids will be 31 July 2006. The government will also consider extensions to the July 31 bidding deadline for areas wishing to develop a community owned model and who need more time to complete their bid It is expected that decisions will be announced by the end of September. A PFI bidding round was launched last December, closed on 31 March and the outcome should be announced by the end of July.

3. The majority of local authorities and RSLs should not expect to change their timetables for delivery. However, for a small minority of homes, it may make sense to continue beyond 2010 in order to deliver value for money or achieve wider objectives. Therefore, the government will be prepared to negotiate individual delivery timescales for a minority of areas where there are strong reasons to extend the work.

4. Where the Decent Homes deadline risks preventing local authorities and RSLs delivering more transformational progress on major estates on which there are wider options to increase regeneration and deliver more mixed communities the government will consider whether work needs to be extended beyond 2010. The government will also consider sympathetically extensions to the 2010 deadline for those areas where accelerated delivery may reduce value for money. Where ALMOs are late starting the programme and also those where there have been performance difficulties will have individual timetables negotiated on the basis of their local circumstances. For PFI programmes and stock transfers which are commencing late in the programme the government will consider the individual circumstances in order to agree realistic timetables.

5. Participation by residents is vital to creating sustainable mixed communities. The government wants to build on the success of tenant involvement in the options appraisal process by promoting greater tenant management and ownership of these organisations. A variety of models exist, including Community Gateway, community mutual approach, and community land trusts. These models should be considered by those councils that have yet to agree with their tenants how they are to implement their preferred route to decent homes if it is either ALMO or transfer. There are already examples of tenant owned transfers, including transfers to tenants groups, such as TMOs - as in Walsall and Wirral - or through the Community Gateway Model, as in Preston. The government will be asking all authorities applying for places on the 2006 transfer programme to consider a tenant owned transfer.

6. This bidding round will be the last within the decent homes programme. In the future the government wants a more integrated approach that involves local authorities, ALMOs and RSLs. The case for investment in improving social housing should be considered alongside other investment necessary to deliver sustainable mixed communities and not as a separate programme. The government wants councils, with residents and local partners, to consider how they might more effectively use existing resources and assets to improve the sustainability of their neighbourhoods and to reach their own view on what the relative priorities are. Local Area Agreements could offer the opportunity to do this and the government will explore this as part of the Comprehensive Spending Review.

7. Following the review of the long term future of ALMOs the government has been considering, as a future vehicle for creating long term sustainability of council housing, ideas for allowing some excellent local authorities and local authorities with excellent ALMOs to operate their finances outside the housing subsidy system.

This approach would have costs both for government and for local authorities, which must be fully understood. The government intends to build on the work already done by inviting a small number of excellent local authorities and ALMOs to work with us to establish in detail the costs and benefits of this approach and to determine whether greater value for money could be achieved. This work will be conducted as part of the Comprehensive Spending Review.

Background information on the Decent Homes programme

8. England has around four million social homes, which together form a vast asset worth around£400bn. But sustained under-investment meant that, in 1997, our local authority homes needed more than£19bn worth of repairs and maintenance to bring them up to a decent standard.

9. We therefore have a target to ensure that, social homes meet minimum standards of decency, and that 70 per cent of vulnerable households in the private sector have decent homes.

10. A decent home is one that:

* meets the current statutory minimum for housing, which from April

2006 is the Housing Health & Safety Rating Standard (HHSRS);

* is in a reasonable state of repair - a home which fails to meet this criterion will have either one or more 'key' building component that are old and in poor condition or two or more 'other' building components that are old and in poor condition;

* has reasonably modern facilities and services - homes which fail to meet this criterion lack three or more of a specified list of facilities;

* provides a reasonable degree of thermal comfort, ie it has effective insulation and efficient heating.

11. In order to bring in the investment needed to achieve this challenging objective, we provide three innovative and flexible ways to support local authorities who need additional funding to make their homes decent:

* Setting up a high-performance Arms Length Management Organisation (ALMO);

* Entering into a Private Finance Initiative (PFI) contract; or

* Transferring stock to Registered Social Landlords.

12. Where extra resources are not required local authorities will make their homes decent through retaining both ownership and management of the homes.

13. We have reduced the number of non-decent social homes by more than half, and increased the proportion of vulnerable households in the private sector who have a decent home to 66 per cent.

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