Tenants could be denied right to buy

Government policy on housing association sales may be scrapped in favour of voluntary scheme

HUNDREDS of thousands of tenants could be denied the right to buy their own home after ministers signalled they will water down plans to allow housing association property sales.

Greg Clark, the Communities Secre- tary, yesterday indicated that the Government could do a deal that would see legislation scrapped in favour of a voluntary scheme.

Under the proposal, put forward by the National Housing Federation (NHF), housing associations could choose which home tenants could buy and prevent them from purchasing the property they already live in.

The plans also propose a cap on Right to Buy discounts which could set a limit on the number of people allowed to purchase homes each year.

Associations have a week to sign up to the new voluntary deal, which guar- antees them all revenue from house sales, including a government repayment for the discount received by the tenant.

If they refuse, ministers will push forward with legislation to force associations to sell off homes in the Housing Bill this autumn.

The NHF plan represents a dramatic change to the Government’s policy after David Cameron’s election promise to grant 1.3 million housing association tenants the right to “own their home”.

He said the scheme would be funded by requiring councils to sell off the most expensive social housing when it becomes vacant, replacing it on a oneto-one basis with more affordable property.

The decision to consider a voluntary scheme follows intense criticism from the sector after housing bosses claimed that the Government has no right to dictate what they do with their assets.

Concerns were also raised that the plans could worsen Britain’s shortage of affordable social homes and that the industry’s £60billion borrowing debt may have to be added to the public books.

Mr Clark said yesterday that he is now prepared to drop the threat to force housing associations to sell homes and will instead pursue a voluntary programme as long as proposals meet the Government’s manifesto pledge.

But the decision will be criticised as a sign that the flagship policy was not properly thought through before the election.

David Orr, the chief executive of the NHF, said a voluntary agreement would mean “housing associations could retain the independence which has allowed them to channel billions of pounds in private investment into home building over the last 30 years”.