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Interview: Sir Michael Lyons urges more public-private partnerships

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The majority of councils no longer retain the skills needed to enable large-scale housebuilding and will have to look more to private sector partnerships if they are to quickly tackle any local housing shortages, Sir Michael Lyons has told LGC. 

Now that the housing revenue account borrowing cap has been lifted, the chair of Labour’s 2014 housing review said councils could help “accelerate the process” of building affordable homes by bringing in private sector partners to share the risk of development.

Sir Michael said: “The cap has only just been lifted but what many councils will be reflecting is, even with the cap lifted, how do they accelerate the process of bringing a development forward?

“A partnership is a way of doing that, of bringing the skills around the table. Sharing the costs of getting the thing going and also of sharing the risk associated with it.” 

Sir Michael was speaking following the launch of Sage Partnerships, a “partnerships company” established by capital investors Blackstone and Regis, set up as a sister company to registered provider Sage Housing. Sir Michael said Sage Partnerships, of which he is a non-executive director, was focused on working with local authorities to deliver “long-term affordable rented accommodation”, built on public land and largely paid for by private capital. 

The ex Birmingham City Council chief said: “We will invest [money] and councils will invest land; we will invest side-by-side.”

With a focus on delivering affordable homes in the build-to-rent market, Sir Michael said Sage should be “more attractive” to local authorities, health trusts, housing associations and other public bodies.

In his housing review, Sir Michael said there was a case for “mobilising more private investment” for housing.

Sir Michael said it was “not a surprise” housing had risen “right to the top of the political agenda” but welcomed the focus on it.

“Local government is on the sharp end of this [crisis]; it has to deal with homelessness, to do the best it can to make great places, so it’s under no illusions that it needs to build new homes,” he said. “How does it do that when it’s trying to do so many other jobs and it’s under such financial pressures? The answer is, find a great partner to work with you.”

 

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