The Department for Communities & Local Government is open to having conversations with councils about increasing the supply of social housing and potentially increasing the amount they can borrow to build, a minister has told LGC.
Local government minister Marcus Jones also said councils will find out “by the turn of the year” how much of a share of the £61m being made available to implement the Homelessness Reduction Act they will receive. However, he indicated no extra funding will be made available to councils despite concerns in the sector there is insufficient money to carry out its new duties.
In a fringe session on homelessness Mr Jones said the government had an “aspiration for more social housing” to be built.
Speaking to LGC after the event at the Conservative party conference in Manchester, Mr Jones said: “The department is willing to have a conversation with local authorities to see what can be done.”
Mr Jones said the scope to increase borrowing limits for councils to build social housing would form a part of those discussions.
“Local authorities have got that option to come forward and look at ways in which we can increase the housing supply,” he said.
He spoke after LGC’s survey of local authority chief executives, service directors and senior managers revealed more than half have doubts the Homelessness Reduction Act will have the desired impact once it comes into force in April 2018. Concerns largely centre on whether the £61m being made available over two years is sufficient.
Mr Jones told LGC: “We think we have got our figures right.” He added the government had already responded to the sector’s concerns by raising the total pot from £48m to help fund the extra responsibility which requires councils to provide interim accommodation for households awaiting a decision on their status.
Councils have not yet found out how much of a share of the £61m they will get and Mr Jones said allocations will be made public “by the turn of the year”. He also said the government is still working on its code of guidance for councils. Last month London Councils executive member for housing Sir Steve Bullock (Lab) wrote to Mr Jones warning the delay was putting at risk councils’ abilities to properly undertake new legal duties to tackle homelessness.
When it was put to Mr Jones that councils are being given little time to prepare, Mr Jones said: “I appreciate those concerns but there is a balance to be struck here and there has been some resistance to the act within local authorities and we need to be conscious of those concerns.
“But the government will not be deflected from its will to address this problem [homelessness].”
During the fringe session on homelessness Bob Blackman, the backbench MP responsible for the Homelessness Reduction Act, called on “housing associations and other registered social landlords” to “get off their huge asset base and huge credit balances and start building homes”.
Meanwhile, Mr Street said he had been “surprised” at how big an issue homelessness was among the electorate when he was campaigning to become West Midlands mayor.
“It’s an enormously significant issue on the doorstep,” he said. “It came up more often than anything else…which surprised me.”
Mr Street said research by KPMG for the West Midlands CA showed homelessness is costing the region about £121m over three years. As a result he is asking the DCLG to provide extra funding with a view to saving money further down the line.
Later in the session Mr Jones acknowledged Mr Street’s bid for funding and said it was “good to have ambition” but he did not indicate the mayor would be successful.