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Welsh Assembly proposes Right to Buy suspension

Jocelyn Davies, the Welsh Assembly’s deputy minister for housing and regeneration is proposing a suspension of the Right to Buy scheme.   

Today she has introduced the proposed measure for the National Assembly Members’ consideration.

She says the proposed measure will cover two important areas which are intended to improve the delivery of affordable housing.  

The first covers the suspension of the Right to Buy and related rights.  The second provides the Welsh Ministers with enhanced intervention and enforcement powers over the provision of housing by Registered Social Landlords.

She says the Council of Mortgage Lenders and the Tenants’ Federation amongst others have positively welcomed the proposals for the enhanced intervention and enforcement powers.

The objective underlying the policy is to provide local housing authorities with a period of grace, when statutory rights are suspended, to enable the supply of affordable housing in the area subject to a direction to be increased by other means.  

Ways in which this could be done include the use of section 106 planning agreements; use of public sector land for affordable housing; bringing back empty properties into use as affordable homes and an increase in non-grant funded affordable housing.  

When the supply of affordable housing has been built up and the period of suspension ends, it is intended that tenants will be able to exercise their statutory rights once again.

The way in which suspension of the Right to Buy is set out on the face of the measure makes the objective very clear in that suspension will only be used as a temporary mechanism to halt the sale of social housing in a clearly defined area while supply is increased by other means.  

The proposed measure provides that only Local Authorities may apply for suspension.  

Davies says this is because, as strategic housing providers, they have a duty to assess and make provision for housing needs in their areas – whether or not they retain housing stock.  However, before submitting an application, the measure states that they must consult interested bodies, such as local Registered Social Landlords and tenants’ groups.  Local authorities will also have to provide evidence to demonstrate what action they will take during the suspension period to improve the supply of affordable housing.

The proposed suspension period is for a maximum of five years with the possibility of one extension for a further five years, if further convincing evidence is provided.  I believe the Measure represents a sensible compromise between improving provision for people who are in housing need whist also recognising the long term aspirations of tenants who wish to buy the home which they currently rent.  

Davies says: “Part two of the proposed measure will provide the Welsh Ministers with enhanced regulatory and intervention powers concerning the provision of housing by Registered Social Landlords. A very broad range of intervention powers is required to maintain the rigour and credibility of the regulation of Registered Social Landlords.  This is because we must ensure that lenders’ confidence in the regulatory regime for Registered Social Landlords is maintained so they are content to continue investing in Wales.  Our RSL sector spends almost £500m a year and provides 14,000 jobs both directly and indirectly.  So it is clear that this is a very important sector.

“In the future, as the sector develops against a backdrop of tighter public expenditure, the demand for funding from existing associations and new transfer organisations will increase.  This is likely to occur along with challenging conditions for private finance and the wider funding shortage.  It is therefore crucial that the development of the new regulatory regime ensures that the ability of the housing association sector to attract private finance is maximised for the benefit of tenants.”   

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