'Affordable rents' will increase costs to public purse

Housing association Family Mosaic has published groundbreaking research into the impact of reletting existing homes on new "affordable rents".

Family Mosaic welcomes the principle behind the government's plans, but commissioned the research because it was worried that rent levels of 80% of market rents would be too high for the people it wants to house in London. So the association asked independent researcher Mark Lupton to look at what would have been the impact had 50 new tenancies granted within its stock in November and December 2010 been relet at 80% or at 60% of market rent.

The research, published in "Mirror, signal, manoeuvre: our drive to provide more social housing" found that, had these 50 homes been let at 80% of market rents,  the housing benefit bill for these 50 tenants would have increased by 151%; at 60% of market rents the bill would have increased by 68%.

The research found that the impact on Family Mosaic's tenants will vary by location, with those living in inner London the hardest hit. At 80% of market rent, seven inner London properties in the study would have seen increases of over £200 a week. Outside London, however, these increases would have been less than £50 per week.

In contrast, most of the sample properties in Essex had social rents that are already at 60-80% market rates.

The report concludes that, for those tenants receiving benefits, the proposed new affordable housing model creates, or worsens, the poverty trap, acting as an additional disincentive to gain employment.

The study looks at the risks and benefits for the housing association, concluding that converting relets to "affordable rent" would generate considerable extra income to support its development activity, but would increase its dependency on housing benefit. The research ignored the £26,000 cap on benefits which brings additional challenges.

Family Mosaic CEO Brendan Sarsfield says,

"We are determined to deliver more homes, but this look in the mirror tells us that the new model creates problems for our residents. Market rents per se are not the problem – we have used them in temporary housing for many years.

"The challenge now is can we make higher rents work as a long-term solution during welfare reform and public spending constraints." 

Audit Commission closure delayed

A leaked memo from Audit Commission boss Eugene Sullivan reveals that the quango Eric Pickles loves to hate is unlikely to be abolished by 2012 as ministers have promised.

The BBC has seen a memo saying that the earliest it would close is the end of 2013:

"We are now working to a longer timetable. We think the earliest the commission will be abolished is December 2013 and possibly not until the end of 2014.

"It is clear that we cannot run the commission as if it were going to close by December 2012. The Audit Commission Management Team has therefore decided that we should turn more to a 'business as usual' rather than a 'close-down' model."

Lord Beecham, former Labour chair of the Local Government Association, told Public Finance that the decision to abolish the Audit Commission was "another example of the government deciding to do something and then looking into the consequences, financial and otherwise.

Beecham said that there had been no prior consideration of what would happen to the watchdog’s remit aside from financial audit, adding that he hoped there was a ‘rethink’ going on but things had probably gone too far for a policy u-turn.  "I can’t see him [Pickles] backing off this one."

A DCLG spokeswoman told Public Finance:

"The government has stated that reforms to the local audit regime are likely to take effect from 2012/13. A first consultation on the details of a new audit framework is planned for late March. Following this consultation, the government will then publish a draft Bill for pre-legislative scrutiny. Following such consultation and scrutiny it is the government’s intention to introduce the necessary legislation at the earliest opportunity."

But the BBC reported a government source attacking the spending watchdog for making a "desperate move to keep themselves going for longer" and questioned the motives of its senior management - insisting that the plans to close it were "still on track".

There's more comment from the Audit Commission's former managing director for communications in his Public Finance blog.

PM promises privatisation of public services

David Cameron, writing in the Daily Telegraph, today expanded his vision of Big Society to include the 'modernisation' of public services by handing them over to the private and voluntary sectors.

A White Paper on public service reform is expected in the next two weeks.

There will be new presumptions that public services should be open to a range of providers competing to offer a better service, and that services should be delivered at the most local level possible. This 'competition in a single clause' is intended to make it impossible for government to return to "the bad old days of the standard state monopoly", with only national security and the judiciary singled out in the article as exempt from competition.

Cameron deplores the current position of "the producers of public services over-ruling the people who use (and pay for) them" although in the following paragraph he declares that "professionals will see their discretion restored."

The unions' reaction was predictable -  TUC general secretary Brendan Barber said:

"This is a naked right wing agenda that takes us right back to the most divisive years of the 1980s."

"Privatisation replaces democratic oversight and accountability with a contract culture that is a job creation scheme for lawyers. Voters and service users lose their say in what will be a get even richer quicker scheme for the companies that win contracts."

The BBC's political correspondent Ross Hawkins summarises some of the measures to be expected in the White Paper:

• letting public workers themselves take control of the services they provide by helping them form mutual organisations and to give them the legal right to do so

• introducing technical changes that will make it easier for small firms and charities to compete for existing government contracts

• expanding the use of personal budgets to allow people to buy services outside the public sector

New Homes Bonus details and reactions

The government published final details of its New Homes Bonus scheme on 17 February, saying its draft proposals had met with widespread approval.

The New Homes Bonus is designed to incentivise local areas to welcome housing growth. Commencing in April 2011, the New Homes Bonus will match fund the additional council tax raised for new homes and properties brought back into use, with an additional amount for affordable homes, for the following six years.

Nearly £200 million will be available in 2011-12 and £250 million for each of the following three years of the Comprehensive Spending Review period.

Commentators have questioned the likely impact of the scheme, suggesting that incentives within the planning system will take several years to impact on supply and questioning the extent to which the payments will overcome nimbyism. The government's own impact assessment suggests that the New Homes Bonus is only likely to deliver an additional 14,000 homes each year for the next ten years.

The NHF believes that, because the bonus payments are based on which national council tax band the house sits in,  the scheme will promote the building of spacious homes in the South, with rewards in effect part-funded through cuts in funding to deprived areas. It argues that the new system will also be geared against social housing as that tends to be worth far less than the average private sector home, usually sitting within council tax bands A and B.

Meanwhile, the Campaign to Protect Rural England (CPRE) has obtained a legal opinion that by linking the outcome of planning decisions to financial rewards, any decision taken would be tainted and open to question.

No friends in the North (East)

In answer to a recent parliamentary question from shadow communities secretary Caroline Flint, the government revealed that none of the Department of Communities and Local Government ministers had visited the north east of England since their appointments last May.

By contrast,  they seem to have a fondness for the North West, which was the destination for one fifth of all 59 ministerial outings, with Manchester alone getting six visits.

In fact ministers' commitment to localism has rarely tempted them out of their Westminster comfort zone at all - Secretary of State Eric Pickles and Minister for Decentralisation Greg Clark have been surprisingly reluctant to venture beyond Westminster, despite their commitment to localism: Pickles has only made six ministerial visits in the eight months he has been in post, and Clark merely four.

Cameron to recruit 10 new policy advisers

The Independent reports that David Cameron will recruit 10 high-ranking policy advisers in a bid to stop high profile mistakes, which have forced him into a series of embarrassing U-turns.

The most prominent about-turn was the coalition's plan to sell off England's public-sector forests. The idea was abandoned when a YouGov poll revealed that just 2 per cent of people supported it.

Mr Cameron's advisers will shadow the work of Whitehall departments, in recognition of the fact that ministers have been allowed too much leeway to create new policies without Number 10's full knowledge.

The Prime Minister scaled back New Labour's once powerful policy unit when he gained office - a process begun by Gordon Brown, who cut the number of special advisers from 78 to 68 hoping this would reduce their £6.8m wage bill by £2m.

It now seems that the coalition might employ even more special advisers than New Labour did. According to the Independent:

'Insiders say the promise to have fewer did not anticipate the extra pressures of a coalition. Junior and middle-ranking Liberal Democrat ministers may be allowed to recruit special advisers for the first time.'

For more embarrassing coalition U-turns, see our new list at the bottom of the side bar on the right.

Coalition shakes up welfare system

The coalition's new Welfare Reform Bill was unveiled on 17 February and hailed as 'the biggest shake up of the system for 60 years.' It introduces a system of Universal Credit, replacing six in-work benefits with a single payment.

Universal Credit will come into force for new claimants from October 2013.

The bill contains a surprising u-turn: the government has ditched controversial proposals to cut housing benefit by 10 per cent for anyone who has been on jobseeker's allowance for more than 12 months. The National Housing Federation is pleased with this decision, as it is amongst those who have campaigned against the proposal.

However, the bill does allow other limits the government has announced for housing benefit: a cap on the total level of benefits and the reduction of housing benefit for underoccupying households.

David Cameron claimed the reforms will cut £5.5bn from the welfare bill over the next four years saying, "We're finally going to make work pay – especially for the poorest people in society. And we're going to provide much greater support for unemployed people to find work – and stay in work."

The underlying principle of Universal Credit is to make it pay to work. The government estimates that about 2.7 million households will have higher entitlements as a result of Universal Credit, with more than one million households seeing an increase in entitlements of more than £25 a week.

Although the bill contains a provision for housing benefit to be paid directly to social landlords, Inside Housing writes 'DWP officials said this new facility could only be used in exceptional circumstances, such as for vulnerable tenants who would struggle to manage their budgets.'

While the Chartered Institute of Housing (CIH) broadly welcomed welfare reforms, its Deputy Chief Executive Richard Capie hoped for further changes, saying 'CIH recognises the importance of reducing the welfare and housing benefit bills and has supported reform in this area for some time. However, as with the JSA decision, we hope that parliament and government in particular will revisit some important aspects of the legislation, which for all their good intentions, remain deeply flawed and unsustainable.'

Shelter sounded a warning bell after the bill was unveiled, and its Chief Executive Campbell Robb said, 'Plans to remove the link between housing benefit and the housing costs people pay will push those seeking work out of their homes and into areas with fewer job opportunities.'

The BBC has published a useful question and answer page about Universal Credit and the benefits overhaul.

HCA announce Decent Homes funding

The Homes and Communities Agency has confirmed that local councils will receive £1.6bn to help bring council owned homes to the Decent Homes Standard over the next four years.

For the first time, councils that retained management of their homes will receive decent homes cash (£379m) with the balance going to councils with ALMOs. The funding is expected to halve the backlog of Decent Homes works in the council sector by 2015.

The remaining £500 million will be used to meet existing commitments for to 'gap' fund 28 Large Scale Voluntary Transfer housing associations.

The HCA has published tables showing its complete list of Decent Homes funding allocations, and LSVT 'gap funding' figures.

ALMOs were predictably disappointed with the funding, which, as we reported last year, has left many short of cash to complete improvement works promised to tenants.

Nottingham City Homes called its award a 'major blow' for tenants, and its chief executive Chris Langstaff said:

"We are very disappointed that because of the reduced funding, we will not be able to finish our programme as soon as we wished."

On the other hand, stock retained councils such as Northamptonn BC welcomed the news.

HCA unveils Affordable Homes Framework

The Homes and Communities Agency has announced its long awaited Affordable Homes Programme for 2011-15, inviting social housing providers to bid for £2.2 billion of funds from a £4.5 billion 'pot'.

The Housing Minister Grant Shapps described the scheme as, 'the most radical reforms to social housing for a generation', saying:

"With some 4.5 million people on social housing waiting lists, it's clear that not only do we need more homes, but we also need a complete overhaul of the system, to one that offers much more flexibility than the current 'one size fits all' approach."

The majority of new homes will be made available under the government's new 'Affordable Rent' model which allows landlords to rent homes, to new tenants only, at up to 80 per cent of local market rates, so that the extra revenue can be invested in new homes.

This revenue is designed to help landlords build 150,000 homes over the next four years, supported by an additional £1.8 billion of government investment, to generate affordable rents and increased home ownership.

A further £410 million has been set aside for mortgage rescue, empty homes, homelessness and traveller pitch funding.

Social landlords must meet strict criteria when applying for funds. They will be asked to bid for the duration of the four-year programme, and they will have to submit detailed financial information, demonstrating how their plans meet local needs.

Landlords applying for funds of £3 million or more must, in line with the coalition's transparency agenda, publish quarterly figures for all relevant expenditure over £500.

Bidders will be expected to generate additional borrowing capacity from the conversion of social rent properties to 'Affordable Rent' and other sources of cross-subsidy.

Requests for HCA funding must be 'the minimum necessary for delivery to be viable', and where HCA funding has been agreed it will be on a 'payment by results basis'. The new framework says that 'funding for social rented housing may be considered in exceptional cases.'

Applicants have until 3 May to submit their bids, and the first contracts will be be signed in July this year.

The Chartered Institute of Housing has released a detailed briefing on the framework.

In addition, the DCLG has published a consultation on a technical revision to Planning Policy Statement 3, intended to include 'Affordable Rent' within the definition of affordable housing for planning purposes. The closing date for responses is 11 April 2011.

The minister also announced that the existing inflation-linked formula for annual rent increases in social rented housing will continue to apply throughout the 2011-15 Spending Review period.

£8m funding for tenant empowerment

Grant Shapps has announced that the Tenant Empowerment Programme (TEP), currently run by the Tenants Services Authority on behalf of the DCLG, will receive annual funding of £2m for the next four years.

TEP provides information, training, and capacity building to enable social housing tenants to challenge, influence or control how housing services are delivered to their communities, in order to improve the quality of life for residents.

The DCLG press release suggested that the money will be used to help set up Tenants Panels to hold landlords to account. It also said that the Minister is planning to reduce bureaucracy and red tape to make it easier for tenants across the country to use their Right to Manage their council-run properties.

Shapps said:

"The Big Society is alive and well in many housing estates across the country - but I want to make it easier for those who want to build the Big Society in their own back yard to do so. The Right to Manage gives council tenants the opportunity to take power back from their landlords, and take control over their own homes and to make the changes they want to see.

"There are inspiring examples across the country of where tenants have taken control. But at the moment, only two per cent of council properties are managed by their tenants - I want to see that figure increase substantially. That's why I'm backing tenants to the tune of up to £8m, and looking to cut the red tape and bureaucracy that stop so many people from coming forward."

Big society not a cover for cuts says Cameron

Following a week of criticism, David Cameron, writing in Sunday's Observer, defends his "big society" project to bring people together to improve their lives and the lives of others.

Last week the retiring head of Community Service Volunteers Dame Elisabeth Hoodless said that government spending cuts are destroying volunteering and undermining its big society vision, and  Channel 4 News reported that more than half of domestic violence services across the country do not know if they will be able to remain fully open after March due to funding cuts. A poll conducted by the Independent on Sunday found that a quarter of those polled say they have never heard of the big society and 41 per cent see it as "merely a cover for spending cuts".

Cameron writes that the big society is about changing the way the country is run, and that it is important to do regardless of the state of the economy:

"Building a stronger, bigger society is something we should try and do whether spending is going up or down."

He denied that the big society was threatened because voluntary bodies are being starved of state money:

"We are in the process of opening up billions of pounds' worth of government contracts so charities and social enterprises can compete for the first time. The scale of this opportunity dwarfs anything they've ever had before."

"But we understand that while the opportunity lies in the future the local authority cuts are happening now. So this week we are launching a transition fund to help charities prepare to bid for these contracts and a big society bank to provide some working capital when they're awarded them."

The government announced last week that the banks would provide £200m funding for the Big Society Bank as part of the "Project Merlin" agreement over bankers' bonuses. This is in addition to funding expected to be received from old and forgotten bank accounts, and will be provided on a normal commercial lending basis, leading to criticisms that the banking sector will make a profit on the Big Society Bank money.

Meanwhile, Labour Leader Ed Milliband, writing in the Independent on Sunday, lambasts the direction that the big society idea is taking. At the end of his article he introduces the worrying spectre of a rival new Labour brand of society, writing:

"I am determined that the failure of the Big Society concept should not lead to the kind of pessimism about our shared future that we saw in the 1980s. It is Labour's task to show Britain – even after all the damage inflicted by the Government – that a stronger society, a Good Society can still be created."

Good Society. Puh-leeze!

Home Group to publish expenditure

Home Group has 'broken rank' from other housing associations and promised to publish details of all expenditure over £500, according to Inside Housing.

Home Group has taken this action in spite of the National Housing Federation's concern that publishing such data may threaten its status as a private sector organisation.

In an opinion piece, Home Group Chief Executive Mark Henderson said:

"While we prize our independence and heritage as greatly as any other provider, we recognise our services are interwoven with wholly public organisations."

The data is not yet on Home's website. It is expected to be published within the next few weeks.

Audit Commission abolition was 'not evidence-led'

Public Finance has reported the Commons' communities and local government select committee inquiry into the abolition of the Audit Commission.

In its first oral evidence session, all three expert witnesses agreed that the spending watchdog did not ‘deserve’ to be deleted without alternatives being examined.

David Heald, professor of accountancy at University of Aberdeen Business School, told the select committee that there had been no evaluation of the performance of the commission before the secretary of state’s announcement and that reform would have been a better option.

Heald added that his biggest concern was the government’s decision to breach the ‘fundamental principle of public audit’ by allowing councils to appoint their own auditors.

David Walker, former director of communications at the Audit Commission, suggested a ‘cleansing or cheapening’ of the body would have avoided many of the problems the government is confronted with as a result of the closure.

Steve Martin, professor of public policy and management and director of the Centre for Local and Regional Government Research at Cardiff University, warned that the abolition would ‘leave quite a gap’. He also said alternatives should have been considered first, adding ‘this was not an evidence-led policy decision.’

Middle manager salaries under spotlight

Communities Secretary Eric Pickles has embarked on a new crusade, to "shine the torch of transparency on Town Hall middle management across the country".

Councils will be asked to publish an organisational chart including the names and responsibilities of staff paid over £58,200 - equivalent to the lowest Senior Civil Service pay band. Ministers believe this will give the public the full picture of a council's management composition.

This is a new requirement - since 31 January councils have had to details for purchases over £500 and salary details of top management.

Pickles said:

"The taxpayer has a right to look under the bonnet of their Town Hall and see what decisions are being made on their behalf and where their money is being spent.
   
"Transparency must be the underlying principal behind everything councils do. Every aspect of council business should be open to public scrutiny including senior pay, councillor expenses, local services and voluntary sector funding. This can help save money in tough times, protecting the frontline by cutting waste and unnecessary costs."

The DCLG has published a draft Code of Recommended Practice for Local Government Data Transparency for consultation - the closing date for comments is 14 March 2011.

There have been calls for other agencies (including housing associations) in receipt of public funds to meet similar standards - the Homes and Communities Agency is expected to impose some transparency requirements on housing associations receiving development grant.

Labour launches housing policy review

Shadow Communities Secretary Caroline Flint is to lead a Labour Party policy review on “how do we meet families aspirations for good housing and a good home?”

The review will include evidence from a wide range of experts in housing including Tom Bloxham (Urban Splash), Peter Williams (Former Deputy of Council of Mortgage Lenders), Professor Steve Wilcox (Centre for Housing Policy, University of York) and Graham Watts (Chief Executive of the Construction Industry Council).

The coalition has already embarked on its own review of housing policy. The terms of reference and timescales for neither study have been published.

Flints's housing review was one of a number launched by Leader of the Opposition Ed Milliband in Gateshead last Friday. The others are:

• “What do families want from good local schools?” and “what do children need to become successful adults?” led by shadow Secretary of State for Education Andy Burnham.

• “Family life. What helps?” led by shadow Cabinet Secretary Tessa Jowell

• “Talent, aspiration and growth: is Britain missing out?” led by shadow Secretary of State for Culture, Media and Sport Ivan Lewis

May announces new ASB toolkit

Theresa May has launched a Home Office consultation on reforming powers available to police, councils and social landlords to tackle anti-social behaviour (ASB).

The consultation states that the current toolkit of options to tackle ASB is extensive, but:

• there are too many tools, and practitioners [or courts?] tend to stick to what they know
• some of the formal tools are bureaucratic, slow and expensive
• the tools do not deter repeat offenders
• measures to help perpetrators deal with underlying causes of their ASB are rarely used.

The Home Office has proposed a 'radical streamlining' of the toolkit. Rather than having a tool for every problem, the police and partners will have faster, more flexible tools. These include:

• a Criminal Behaviour Order that can be attached to a criminal conviction
• a Crime Prevention Injunction that can quickly stop ASB before it escalates
• powerful perpetrator incentives; such as making breach of the new orders grounds for eviction from social housing
• bringing together many existing tools for place specific ASB into a Community Protection Order
• a consolidation of dispersal powers into one police power to direct people away from an area
• making informal and out-of-court tools more rehabilitative and restorative
• introducing a Community Trigger that gives victims and communities the right to require agencies to deal with persistent ASB.

The consultation will run until 3 May 2011.

Who will benefit?

Welfare Minister Lord Freud confirmed in a speech at a British Property Federation (BPF) conference that direct payment would be phased out of the social housing sector and used as a "matter of exception where required" rather than as a matter of course.

According to Inside Housing Freud claimed that the sector has been 'overprotected' compared to the private housing market.

Social landlords are concerned that ending direct payments - where rent is paid directly to them by a local authority, rather than by tenants - when universal credits are introduced will increase associations’ business risks. The group finance director at L&Q Waqar Ahmed, talking last month to Public Finance magazine, said:

"At L&Q, around 64% of our social ­housing residents are from local authorities in receipt of housing benefit. Local authorities are almost defined as default-free creditors."

"So, as far as the banks are concerned, more than £200m comes from risk-free sources. If you pass that on to residents, irrespective of how responsible those residents are, the banks will perceive that as a higher-risk group and would therefore want a higher margin."

Lord Freud promised the BPF that private landlords prepared to "meet us half way" by lowering their rents could expect a return to direct payment.

Universal credits will be introduced in the forthcoming Welfare Reform Bill, but it is interesting to note that the bill's publication has been postponed until later this month.

Inside Housing claims this is due to a "stand-off between work and pensions secretary Iain Duncan Smith and chancellor George Osborne over a £26,000 cap on the amount of benefits that a workless family can receive."

Liverpool abandons 'big society'

The coalition's 'big society' vision has suffered a setback following Liverpool Council's decision to abandon the scheme because of government-driven spending cuts.

Liverpool was a key player in the coalition's big society 'vanguard' scheme, which David Cameron launched in July 2010.

The Prime Minister said the city would build, 'a volunteer program so they can keep local museums open for longer.' However, the Independent reports that the city's museums are bracing themselves for, 'cuts of up to 30 per cent.'

The Guardian quotes from a letter to communities secretary Eric Pickles from Liverpool city council leader Joe Anderson, who wrote:

'When we agreed to become a Vanguard, your government promised to work with us to remove some of the problems and blockages that were preventing us from successfully delivering our Big Society programme. I have to say, the government has failed to deliver a single change that we have requested, which has severely hampered many parts of our programme.'

The Guardian writes:

'The council learned in December that it would lose £100m in specialist grants from the government, many of which were allocated to charities and community groups tackling welfare issues, from worklessness to family breakdown.'

Labour in vain?

Housing minister Grant Shapps yesterday announced the publication of a first tranche of research reports, commissioned by the previous government at a cost of £691,000.

Shapps released the 16 reports "in the interests of transparency," stating that "the reports and findings are of general policy interest, but do not relate to forthcoming policy announcements".

The reports have been buried in the archive section of the DCLG website. We are promised that more reports will be released over the next few months in groups themed on a particular topic.

The "legacy research" includes some reports with obvious practical value, such as guidance on on how to set up and operate choice-based letting schemes to ensure that social housing applicants are not disadvantaged by the proactive nature of Choice Based Lettings.

Other research is more esoteric, around how to make policy sensitive to the enormous variability in neighbourhoods, districts, cities or towns by using methods for categorising place, and how to provide local information at bespoke geographic areas independent of formal administrative or statistical units.

All the reports can be downloaded from the historical research reports page of the DCLG website.

Funds dry up for debt advice agencies

It has emerged that funding for debt advice services has dried up following  the 'deletion' of the Financial Inclusion Fund (FIF), which will be removed in March.

The Guardian says, 'FIF pays for just under 500 debt advisors based in Citizens Advice Bureaux and other not for profit advice centres.

According to insolvency experts Finance7, Citizens Advice has already, 'issued redundancy notices to 900 debt advice staff'.

Debt advice is a key plank in a raft of measures to ensure that tenants avoid falling into arrears, and the Guardian makes the point that:

'Often when mortgage and rent possession proceedings are imminent it is too late to keep families in their homes.'

'Aside from the damage this causes to people's lives, the loss of a family home brings an enormous cost to the state. Shelter, the housing charity, recently calculated that each family forced out of their homes cost the state £50,000.'

Teresa Perchard of Citizen's Advice said:

"It just doesn't stack up, unemployment is rising, the economy is in a difficult situation and there is an increasing demand for debt advice and at this time to lose frontline services in local communities doesn't seem to make sense."

New Health Bill offers involvement opportunity

The new Health and Social Care Bill currently before Parliament, paves the way for social housing providers to become closely involved in commissioning health care services.

The bill signals a radical shake-up of the NHS. Traditionally, Primary Care Trusts (PCTs) have been responsible for commissioning key services, but these organisations will be dissolved in 2013. GP consortia will take over PCTs' commissioning role, and these will be closely affiliated to health and wellbeing boards.

The boards must include key council officials; but the draft bill says there is room for, 'such other persons as the local authority thinks appropriate'. This is where social housing providers come in. Health and wellbeing boards offer a possible 'in' for landlords, although this is likely to present a unique set of challenges for the sector.

The Local Government Association has published a briefing about the new bill, listing its key points. Under the heading of 'Public Health' they cite, 'the Bill’s intention to give local authorities a leading role in improving, promoting and protecting the health of their communities,' acknowledging that housing is a key part of this.

The National Housing Federation (NHF), 'believes that the health benefits of housing and housing related support could be at risk unless the Health and Social Care Bill paves the way for genuine, effective integration.'

In a briefing for MPs they argue that, 'The minimum membership of Health and Wellbeing Boards should include the director of housing, with the option of delegating to the chief executive of a local housing association where appropriate.'

The opportunities are there, and it is up to our sector to push for further involvement.

CIPFA consultation on new accounting framework

CIPFA has developed draft guidance on an accounting framework for self-financing council housing.

The paper sets out CIPFA’s proposals for changes to the capital financing arrangements under the new arrangements and focuses on management of debt and depreciation.

Alison Scott, assistant director of policy at CIPFA, said:
‘These changes amount to a revolution in council housing finance. CIPFA is consulting widely on the proposed capital finance arrangements and the responses will inform further CIPFA guidance, which will help implement these changes effectively.’

The consultation ends on Monday 28 February.

Government sets out HRA reforms

Grant Shapps has unveiled reforms for council housing finance, which will replace the HRA subsidy system.

Alongside the Minister's fanfare, are details published by DCLG on how it will be implemented.

Objectives

The reforms, due to take effect from April 2012, have the following two objectives:

• To give local authorities the resources, incentives and flexibility they need to manage their own housing stock for the long-term and to drive up quality and efficiency.
• To give tenants the information they need to hold their landlord to account, by replacing the current system with one which has a clear relationship between the rent a landlord collects and the services they provide.

Valuations

There will be a readjustment of each local authority’s housing debt, based on a valuation of its council housing stock.

Valuations will be based on assumptions about each local authority’s income and need to spend over 30 years, following the Government’s national social rent policy.

Income and expenditure

Income assumptions are based on the Government's rent convergence policies with local authorities reaching the 'formula rent' by 2015/16.

Expenditure has been calculated using methodology proposed by PricewaterhouseCoopers, BRE and HQN. This includes the recommendation to fund 100 per cent of works.

Nationally, authorities will have an average Major Repairs Allowance of £956 per dwelling per year and average management and maintenance allowances of £2,061 per dwelling per year.

Central government will retain 75 per cent of Right-to-Buy receipts. As this means councils will lose some of their operating surplus, DCLG has built into the valuation a forecast for losses of income and costs for Right-to-Buy sales.

Borrowing

The Government will calculate a Council Housing Borrowing Requirement - similar to the Housing Revenue Account Capital Finance Requirement. It will measure the amount of actual borrowing a local authority uses to finance its council housing.

This will be used to set a Council Housing Borrowing Limit for each local authority, which will make allowances for councils using public funds for new builds.

HRA ring-fence

Abolition of the subsidy system does not end the requirement for local authorities to maintain a statutory, ring-fenced Housing Revenue Account. Local authorities will still be required to account to their tenants for income from and expenditure to council housing separately from income and spending on other functions and services.

Regulation

Regulation of council housing will continue to focus on consumer protection in line with the the Government's review of social housing regulation and the Localism Bill.

The Regulator's existing standard on Value for Money covers all social landlords, including local authorities. The Government expects landlords to use the new flexibility provided by HRA reform to drive up efficiency and value for money.

Stock transfer

In order to agree a transfer in future, the financial terms of any proposals will need to be clearly comparable with what self financing would provide.

There will be an expectation that councils must provide significant financial support for transfer proposals, and no assumptions of financial support from central Government should be made.

The Government is minded to abolish the Large Scale Voluntary Transfer levy after the implementation of self financing and invites views on this.

Ongoing data requirements

For ongoing policy reasons the DCLG will require local authorities to submit data on:

• the number of dwellings and the number of those which meet the Decent Homes standard
• the amount of borrowing for council housing purposes
• council stock composition and property values
• average actual rent levels

Timesecales

Subject to Parliament’s approval, the mechanisms will be in place for self-financing to be implemented in April 2012. The existing subsidy system will continue for 2011-12, on the same basis as previous years.

Provision will be made for outstanding payments and adjustments to be made up to the end of March 2013 in respect of years up to and including 2011-12.

Debt by local authority

Many of the large urban authorities with ALMOs have settlements that are in surplus - Hackney's Self-financing Settlement Payment is -£780.5m. At the other end of the scale, Wandsworth's payment is £382.6m.

The average debt per dwelling is £18,679. Some smaller stock retaining authorities have much higher figures, for example Waverley's is £38,250.

May to axe asbos

The Home Secretary Theresa May has revealed to the Guardian that she will speed up and intensify action against anti-social behaviour. The term 'asbo' will be scrapped, and the different categories of ASB offences will be cut from 19 to five.

May will introduce a consultation 'within a fortnight' about a revised 'toolkit of measures' - designed to be less prescriptive, costly and bureaucratic.

With the consultation will come a new government website, showing crime hotspots and allowing the public to monitor local crime levels.

May said the asbo system will partially remain, but officers will have more discretionary powers. For example, to force offenders to make amends on the spot, clean up graffiti or repair property. This will avoid the longer route of taking offenders to court.

The consultation paper will introduce five new measures to extend police powers:

1. A "criminal behaviour order" that could see someone who is convicted of being drunk and disorderly banned from a town centre for two years.
2. A civil "crime prevention injunction" which could be obtained within "hours rather than months".
3. Court orders to close a property where there has been persistent disorder.
4. Fines for people who have been a persistent nuisance and harmed the quality of life in an area.
5. A "direction to leave" which will see any individual causing or likely to cause crime directed away from a particular place and "related items" confiscated.