Swindon Tenants Campaign Group Newsletter February 2017

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Our February 2017 Newsletter dealing with the proposal to rob the Housing Revenue Account of Funds to bolster Swindon Council’s troubled General Fund, by transfering garages and some shops into the General Fund, resulting in the loss of £1.3 million income. Also included, our Pamphlet, The case for cancelling council housing debt, Right to Buy sales, and “Treat claimants with respect”.

Download a copy here: campaign-group-news-feb-2017

 

Swindon Labour Group supports call for cancellation of council housing ‘debt’

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Swindon Council’s Labour Group has supported our campaign for Labour to press the government to reopen the 2012 ‘debt settlement’ and to commit to cancelling the bogus council housing ‘debt’ if elected to government. Below is Labour Group Leader Jim Grant’s letter to Jeremy Corbyn.

“Dear Jeremy,

I am writing to you on behalf of the labour Group of Swindon Borough Council to give our support to to the  growing campaign for an incoming Labour Government to commit to cancelling council housing debt . This campaign initiated by the Swindon Tenant Campaign Group  has two key elements

  • To re-open the 2012 debt settlement and write off council housing debt in line with the significant loss of rental income resulting from the governments’ policies since 2012
  • Commit to cancelling all council housing debt on election to government

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Leicester Labour Party supports call for cancellation of council housing ‘debt’

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Harry Stannard from Leicester sent us this report.

At its members’ meeting on January 10th, Westcotes branch of Leicester West CLP (Liz Kendall is the MP), passed the following resolution unanimously:

We welcome the Shadow Cabinet’s decision to call for the ‘Right To Buy’ in England to be suspended, and that rent control legislation should be introduced in the private sector.  Along with the Swindon Tenants Campaign Group we also recognise that council housing is facing a serious funding crisis as a result of the so-called ‘self-financing’ policy since 2010, which has led to a growing loss of rental income to local authorities.

We call on the Labour Party and in particular the Shadow Cabinet, National Policy Forum and Leicester City’s Labour group to:

1) Press the government to reopen the 2012 ‘debt settlement’ and demand that it reduces the debt given to local authorities in line with the loss of income resulting from government policies since then.

2) Make a commitment that in government they will cancel the so-called ‘council housing debt’ imposed in 2012, which is draining resources as rental income declines significantly. This should be part of our commitment to making a massive council house-building programme one of the corner-stones of a Labour government.

We resolve to contact the STCG to enquire more details of their campaign, and will send this resolution to our CMC and other branches in our CLP”

Westcotes is the second largest branch in the constituency, and the motion was seconded by one of its councillors, Andy Connelly, who is Leicester City Council’s Assistant Mayor for Housing. Andy explained how council house building in the City had almost dried up for lack of funds, whilst sales enforced on us by the so-called ‘Right to Buy’ are now running at over 300 per annum.

Major house builders and “contrived scarcity” in housing

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Two academics at Sheffield Hallam University have produced a useful paper, Profit Before Volume, Major house builders and the crisis of housing supply.1 The paper examines the role of the major house builders in the housing market and the connection between their domination of the market and the historically low level of house building. The concentration of production into the hands of a small number of major house builders has enabled them to exert a degree of control over what is built in order to maximise their profits and drip-feed supply.

The top ten house builders have increased their share of housing production from nine per cent in 1960 to 47 per cent by 2015. In 1980 there were over 10,000 small and medium (SME) house builders, building 57 per cent of all housing. In 2014 this had dropped to 2,800 firms delivering just 27 per cent of all output.” (Read on below or download a PDF here contrivedscarcity – see the PDF for the Addendum) More

“Statutory homelessness” in Swindon

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The statistics for 2015/16 relating to people who approach Swindon Council as homeless or being threatened with homelessness show a worsening situation.

  • In 2015/16 the number of households approaching the council as homeless was 559. Two years previously it was only 225.

  • The number of households accepted as homeless and “in priority need” (see Addendum for explanation) has risen by 50% over the last two years; from 110 to 165.

  • The number of households living in temporary accommodation has increased by 78% over the last two and a half years, from 201 to 359.

From the figures it’s clear that Swindon Council is finding it increasingly difficult to deal with what is a growing problem. In 2009/10 they managed to assist 956 households in preventing or relieving homelessness. Yet by last year they were able to achieve this in only 287 cases.

The number of households they were able to help obtain alternative accommodation (where they were faced with the loss of their existing accommodation) fell from 757 in 2009/10 to just 242 in 2015/16. (Read on below or download a PDF here homelessnessstatsswindon ) More

LRC calls for Labour to commit to cancelling council housing ‘debt’

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The National Executive of the Labour Representation Committee, chaired by FBU General Secretary Matt Wrack1, has passed a resolution supporting Swindon Tenants Campaign Group’s call (see our new pamphlet) for Labour to:

  • Press the government to reopen the 2012 ‘debt settlement’ and write off council housing debt in line with the significant loss of rental income resulting from government policies since 2012;

  • Commit to cancelling so-called council housing debt if elected to government.

The LRC agreed to write to the Labour leadership calling on them to support these proposals. It also agreed to circulate its affiliated organisations to ask them to do likewise. More

Why the proposal to “appropriate” HRA assets should be withdrawn

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Swindon Council is proposing to transfer assets – garages, shops and “amenity land” – from the Housing Revenue Account to the General Fund. Below I explain why the ‘legal’ justification for this proposal is wrong, how the proposal would be financially detrimental to the HRA and tenants and why it should be withdrawn.

1) Housing Revenue Account ‘ring-fence’; Background

Council housing is accounted for in a ‘ring-fenced’ account within the General Fund. The ring-fence was introduced in 1989, primarily to prevent rates being used to support council house building. However, it also meant that council rents could not be used to support other services. Prior to 1989 transfers between the HRA and the General Fund were common. Rates had been used to support council house building from the end of the First World War. What is less well known is that rents were used by some councils to support other services. In the case of Dacorum Council at one time 40% of their non-housing services were paid for with tenants’ rent. The 1989 Local Government and Housing Act changed this. “From 1st April 1st 1990 there were to be no transfers from the General Fund to make good deficits on the HRA, and transfers from the HRA to the General Fund were only allowed in certain prescribed circumstances” (The HRA Ringfence, Chartered Institute of Public Finance and Accountancy LAAP Bulletin 22).

When Margaret Thatcher introduced Right to Buy in 1980 and council homes began to be sold off to the sitting tenants, what were council estates when built began to include home owners and, later, tenants of private landlords. Services which were previously provided solely for council tenants were now provided for ‘mixed communities’. The 1989 Act included rules for determining when the General Fund should make a contribution to the HRA and vice versa. Schedule 4 Part III of the 1989 Act said that where “benefits or amenities” were shared by the community as a whole, “the authority shall” (i.e. must) make contributions to their HRA “from some other revenue account of theirs” which will “properly reflect the communities share of the benefits or amenities”. Swindon Council does not appear to have been carrying out this duty (of which more later). Read on below or download a PDF here appropriation More

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