This idea was first mooted in the late 1990s. The quasi-corporations would be invented as a means of freeing councils from government restrictions while keeping their housing stock. The aim is to combine the best elements of transfer and stock retention.
The corporations’ revenue and capital accounts would be ring-fenced and they would be able to borrow in the markets, effectively remortgaging their stock. They would be governed by a board with delegated council powers.
Bramley said this would allow some councils to demonstrate they were capable of coping on their own. The government could then concentrate subsidy on more needy councils.
The government has traditionally insisted that quasi-corporations would be counted as public bodies, thereby restricting their borrowing power.
But Bramley said the time was ripe for a rethink of council house financing.
He said it was worrying that the Office of the Deputy Prime Minister’s “blue skies” paper made no mention of the vital issue of getting extra resources into the housing sector.
Bramley warned that even progressive ideas on capital financing were being undermined by the government’s attacks on revenue finance.
“Without a firm and sustainable revenue base, the ongoing daily service provision is being jeopardised year on year,” he said.
“Recent business plans graphically illustrate that within a few years some councils will not only have reduced all revenue contributions to zero but will be faced with cutting existing repairs and management costs. This will jeopardise their ability to meet the decent homes standard and provide the service that tenants expect and deserve for their rent.”
Source
Housing Today
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