Aside Posted on
Housing Minister Greg Clarke has made housing associations an offer they can’t refuse: they have to ‘voluntarily’ agree to ‘right to buy’ in exchange for which they escape the fate of nationalisation followed by privatisation. The deadline for this acquiescence is next Friday, just six working days from Clarke’s announcement. No time for consulting tenants and communities, and actually not enough time for boards to consider the full implications but indications are that they will accept the deal which was brokered by their trade body, the National Housing Federation.
The government gets an extension of right to buy without a battle in Parliament. It is not clear if other moves the housing associations have lobbied for such as freedom to choose their own rent will be granted.
But how did a Conservative government come to be threatening nationalisation? The immediate cause was the policy of extending ‘right to buy’ to officially independent organisations. This triggered a review of the status of housing associations and their debts. By Prime Minister’s Questions last week, Cameron was referring to associations as part of the public sector. That would mean that their outstanding debt of £60 billion would be added to the PSBR. The ‘most obvious’ solution according to the Policy Exchange think tank was to nationalise the housing association sector and then sell it off.
The National Housing Federation will claim this as a triumph because it preserves the independence of associations. But it is at the price of collaborating in dismantling social housing. What right do housing association boards have to agree to sell off assets accumulated over the years by public investment? Housing developments given permission by local authorities on the basis that they were socially balanced with an agreed percentage of social rent will be transformed; are associations going to consult on that?