'I am anxious this will be a continuing programme. If lots and lots of councils wish to do it that says something about the value of the programme', Sir George told LGC in an exclusive interview on Monday. 'The size of the programme may be influenced by the number of authorities which come forward...if no-one comes forward it will be very difficult'.
While the DoE is keen to encourage councils to transfer their housing stock to housing associations, the Treasury wants to restrict the transfer programme because it is landed with virtually all the properties' housing benefit costs. On Monday Sir George announced 12 councils would be allowed to transfer 50,000 homes worth around £560 million in 1994-95, 7,000 more than the number of homes approved for this year.
Bids from West Wiltshire DC and Windsor and Maidenhead BC, involving a total of 7,200 homes, were refused.
'The Exchequer certainly is an important factor', Sir George told LGC. He welcomed the decision of a Labour council, Walsall MBC, to take part in next year's programme. In the past ballots have been lost in boroughs such as Kingston-upon-Thames LBC because the opposition Labour group campaigned against the transfer proposal.
'Councils should try to get all party support. All the evidence shows they are far more likely to be successful', he said. He argued there were clear advantages for tenants if their homes were transferred to a housing association.
'They are on the board in the driving seat making decisions, whereas before they were in the public gallery of the housing committee'. The DoE believes transfers benefit tenants by drawing in private finance, allowing more repairs, improving the financial position of councils, introducing more diversity by increasing the number of landlords in social housing, empowering tenants and encouraging the enabling role of local government.
Other benefits claimed by the DoE include fewer homes standing empty and better management.An Audit Commission report on large scale transfers leaked in LGC in August concluded the only clear advantage was the new housing which could be built.
Existing tenants get a guarantee limiting rent rises for up to five years, whereas if they had stayed with the council they could have faced steeper rises as the government pushes rents towards market levels.
But the National Federation of Housing Associations has said the average rent for new housing association lettings jumped 20.8% in 1992-93 to £43.06 a week compared with an inflation rate of 1.8%. Over the same period the income of new tenants rose by an average of 5.8%. The DoE says the average council rent is £34.
Sir George said he had been encouraged by the large number of transfers in areas such as Kent and Sussex, where councils have pursued transfers after seeing the results in neighbouring districts.