Labour councillors in Hammersmith and Fulham have attacked the Conservative Government’s requirement for a cut in council rents. Labour have used it as an excuse for delays in the Council’s housing maintenance programme. I have asked for the new schedule which is here (with accompanying notes here).
The Council says that over 10 years the lower rents will amount to collecting £76 million less money. But simply allowing the programme to slide in response to lower than expected revenue is a lazy option. They should instead consider what further savings or additional revenue could be achieved.
What about reducing management costs? The Housing Department has so far failed to negotiate any shared service arrangements. Yet the savings here could be millions annually – and thus tens of millions over the decade under discussion.
There should also be an end to the policy of hoarding empty derelict properties. Currently the council has 26 properties that have been empty for more than a year. So those properties are worth millions of pounds but are sitting empty.
Many more will have been empty for over six months. A trigger mechanism should apply for the council to sell properties it can’t afford to repair. What is the point of leaving homes boarded up? I think a “use it or lose it” deadline of six months would be reasonable.
There could also be revenue gained through “hidden homes” on estates. Plans in this regard are feeble. But the potential is great. Funds could be gained by using surplus land or unused buildings – such as empty garages or redundant boiler rooms or pram sheds – to provide new homes. This revenue could provide millions of pounds for capital works as well as much needed new housing – both social housing and market housing.
Of course the revenue would depend on the tenure mix. Suppose, for instance, that the council was provided with a hundred new homes at no cost. This could be funded by the proceeds from the sale of other homes on council land at the full market value.
There would then be the rent on those hundred properties. The council rent is around £100 a week so that would be half a million a year or £5 million over the ten year period. If it was “affordable rent” (up to 80 per cent of market rent) it would be revenue of perhaps three times that.
That’s before we consider the more ambitious agenda of full scale estate redevelopment. Labour now seem to favour this but only if they entire council housing stock is hived off first.
Every tenant and leaseholder will have their own ideas as to how the housing department could save money and operate in a more business like manner. Yet the Labour councillors approach seems to be to passive. They propose to collect their councillor allowances, delay the maintenance programme and blame the Government. If pressed their solution is to give up entirely – with a stock transfer proposal that would mean the abolition of council housing in the borough and thus allow them to abdicate responsibility altogether.