Council Housing: Debts

Communities and Local Government written question – answered on 5th March 2007.

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Photo of Austin Mitchell Austin Mitchell Labour, Great Grimsby

To ask the Secretary of State for Communities and Local Government pursuant to the answer of 7 November 2006, Official Report, column 978W, on housing, whether her estimate of £12 billion took into account (a) the higher costs of work undertaken by registered social landlords, (b) that transfer prices assume a 30-year life of the asset and (c) gap funding; why no allowance was made for the reduction in local authority homes since 2004-05; and why it was assumed that 100 per cent. of the cost of retained homes would have to be found from additional resources rather than existing council budgets.

Photo of Yvette Cooper Yvette Cooper Minister of State (Department of Communities and Local Government) (Housing and Planning)

The higher cost of work undertaken by registered social landlords is the basis for the calculation. Social landlords business plans are based on 30 years which will help inform the investment decisions they make. The figures used in the calculation were based on actual investment by registered social landlords. When we did the calculation we took into account the anticipated reduction in local authority homes, including where a transfer ballot was pending or where a transfer scheme was included on the transfer programme. The calculation is the additional resources needed on top of what local authorities are already spending on the delivery of decent homes, this will include not only money from Government but also money from their own resources. .Where local authorities are able to find additional resources from their own budgets they often do so, which has helped many councils meet their decent homes target. However, many councils have made it clear that they cannot find additional resources from within their existing budgets.

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