Housing and planning minister Gavin Barwell has said he has “no problems” with councils building homes for social rent and indicated issues with local authorities’ borrowing headroom will be addressed in the forthcoming housing white paper.
Mr Barwell’s comments on councils building homes for social rent are a significant change in the government’s stance after six years of being primarily focused on building homes for people to buy with some allowance for homes for affordable rent.
His words came during an appearance before the London Assembly yesterday at which Mr Barwell reminded members he was a Croydon LBC councillor before he was elected Croydon Central MP in 2010.
Mr Barwell said: “When we took control of the council in 2006 one of the first things we did was to start building council homes again. You can take from that I have no problems at all with local authorities doing that.
“If you were trying to ask me about social rent versus affordable rent, there is no bar and there is flexibility of tenure. But what I’d observe is the reason public policy shifted to affordable rent was because it allows us to get more homes for the level of public funding.”
Social rent is typically lower than affordable rent which can be up to 80% of market value.
On the housing revenue account borrowing cap, Mr Barwell said it was “understandable” the government wanted to keep tight controls on the amount councils could borrow as it added to the national debt.
Mr Barwell said: “If you’re asking me, ‘Are all of those caps going to be removed and people can borrow as much as you like?’ No. But we are open to looking at that issue as time goes on and making sure there is resource there.”
While there are some councils with “significant” HRA headroom and reserves, Mr Barwell said the government “will be looking at these issues in relation to the [housing] white paper” which is now due out in January.
Mr Barwell said he was particularly keen to make sure councils can replace the homes they sell through the right-to-buy. LGC previously reported how Mr Barwell had said the extended right-to-buy for housing association tenants will not be rolled out nationally until April 2018 at the earliest.
He told London Assembly members: “I need to make sure the policies we have got allow those replacement homes to get built, and at the moment we’re just about meeting the commitment we have got to replace them within three years but if we don’t raise our game we’re not going to be meeting that commitment in the future.
“We need to look at these issues to make sure councils have the ability to build these replacement homes.”
Mr Barwell said he was supportive of such initiatives.
Meanwhile, Mr Barwell, who is also minister for London, defended transport secretary Chris Grayling’s decision to block suburban rail devolution to the capital.
Responding to claims the decision was politically motivated Mr Barwell said if that was the case Mr Grayling would not have invited Transport for London to be involved in negotiating the next South Eastern rail franchise deal.