Calls grow to suspend ‘Right To Buy’ policy

5,700 homes sold off since 2012 – not one built to replace them

CALLS are growing for the government’s ‘Right to Buy’ policy to be suspended in Greater Manchester after it emerged more than 5,000 council houses have been sold off across the region since 2012 – but not a single one built to directly replace them.

The findings from Greater Manchester’s housing commission, part of the combined authority, reveal that despite government promising ‘one for one’ replacements for any home sold off over the last five years, nothing has been built with the £27m generated from those sales due to heavy Whitehall restrictions on councils.

Andy Burnham, the region’s housing chief Paul Dennett and Graham Stringer, MP for Blackley and Broughton, have now all suggested Right to Buy – which allows tenants to purchase their properties with a large discount – should be suspended here while the region deals with a growing affordable housing crisis.

The new report partly blames government red tape for lack of Right to Buy replacements, noting councils are severely limited on how they can use money from sales, while a large chunk has to be handed back to the Treasury. It also points out, since 2012, tenants have been given bigger discounts, meaning there is even less cash left to build new homes.

“Right to Buy receipts, and the restrictions on their use are not generating replacement homes for those lost through RTB,” it says. “Data shows that 5,700 homes have been lost to the RTB policy in Greater Manchester since 2012 and at the same time no replacement homes have been funded through RTB receipts.

“The sector is losing money through both the discounts awarded to social tenants to purchase their home as well as through money returned to government to compensate for lost income.”

The report provides an overview of how the Right to Buy policy – introduced by Margaret Thatcher in the 1980s as a way to get council tenants onto the housing ladder – has played out in Greater Manchester.

Since then, 92,000 homes have been sold off, although the report says it is ‘surprisingly difficult’ to track how many new council houses or housing association properties have been built over that period.

However, it has managed to pull together figures since 2012, when the government changed the rules around Right to Buy to make it easier for tenants to buy their own homes, including bigger discounts.

In parts of Greater Manchester, there has been a substantial overall net loss in housing stock in that period.

Aside from the housing commission’s research, our sister paper the M.E.N’s own analysis shows in 2015, social house-building of any kind – including through other sources of funding such as from the Homes and Communities Agency – ground almost completely to a halt across the region.

In that year, according to government figures, just 20 new units were built across Greater Manchester, while the following year there were only 10, in Stockport.

Blackley and Broughton MP Graham Stringer, said: “The Right to Buy - without replacing stock – has been a social catastrophe and the government should release the capital receipts, provide more money for housing and suspend the Right to Buy until the balance has been restored.”

Salford mayor Paul Dennett, who leads on housing for the region and commissioned the housing commission report, has now written to government urging it to examine Scotland’s decision to scrap Right to Buy altogether.

“The imposition of higher discounts on Right to Buy properties following the reinvigorated scheme in 2012 mean that in lower value areas, such as some parts of Greater Manchester, a discount of up to £78,000 leaves our local authorities with very little leftover in sales income.

“With large sums also going back to the Treasury, the need to repay attributable debt and the restrictions imposed on how we can use even the small sums remaining, this makes it impossible to replace the social rented homes we are losing, especially with the unprecedented cuts in central government funding which we have endured since 2010, at around 50 per cent in real terms.

“Your own figures show no additional homes have been delivered in Greater Manchester using Right to Buy receipts since 2012/13. The system clearly isn’t working!”

He calls for full, devolved, powers over the money raised from sales receipts.

Asked in February what further powers he believes the region needs to solve the housing crisis, he said: “Registered providers across Greater Manchester are certainly saying to me to try and get government to scrap Right to Buy within Greater Manchester, because we’re haemorrhaging stock here and we need to hold on to it.”

Greater Manchester mayor Andy Burnham also suggested Greater Manchester should have the power to suspend sell-offs.

“Tackling the housing crisis is one of our top priorities in Greater Manchester and it is time for the government to make it one of theirs by focusing on the need for more council and social housing,” he said.

“If we are to tackle the crisis, we all have to be honest about the extent to which the Right to Buy policy has contributed to the problem.

“We can see that the current system is not working as intended. Over 90,000 ●●A report by Greater Manchester’s housing commission partly blames government red tape for the lack of Right To Buy replacement homes in the region social rented homes have been sold in the city-region since 1980 and they’re not being replaced. Right to Buy constrains the supply of social housing.

“Higher discounts and the need to pay some of what’s left to the Treasury means local authorities have little left over to fund replacements. In addition to this, we are also seeing that an increasing number of homes sold through Right to Buy are now in the private rented sector.

“The point of Right to Buy was to help people own their own home – not to expand the private-rented sector – but that is what it has ended up doing.

“While we have the passion and determination to make sure the right housing is available, we also want the power through devolution for local authorities to intervene in the housing market and build more homes for social rent.

“We are ploughing on and putting our plans in place to fix the housing crisis through the ambitious Greater Manchester Spatial Framework and the government needs to give us the tools to do this.”

That could mean ‘reforming Right to Buy or starting again,’ he added, but ‘not tinkering at the edges’ as he believes the government is proposing.

“Now is the time for action,” he added. “The government should look at giving Greater Manchester the power to reduce or suspend Right to Buy here and prevent its extension to housing associations, to stop the problems it has created getting even worse.”

The housing commission’s paper is due to go before council chiefs later this month.