Authorities are concerned that the government's drive for councils to have a strategic housing role rather than a landlord function means they will lose their hands-on housing role.
On Monday, council speakers at a Chartered Institute of Housing and New Local Government Network conference in London warned that budget cuts would be dictated by the boards. The nine boards are due to submit their regional strategies to the Office of the Deputy Prime Minister by the end of the month.
At the conference, Kamal Faizi, divisional director of regeneration and sustainability at Newham council in east London, said the council was bracing itself for a 30% drop in its basic credit approval, which forms the bulk of its housing investment programme funding. Last year, Newham's basic credit approval was £23m.
"It seems likely it will happen, and it will force us to cut back on the work we do to tackle degenerated private sector housing," he said. "Other than that money, there is no strategy in place that is going to help bring private sector housing up to a decent standard." Newham spends about £6m on private sector housing each year.
A senior London housing source also warned of a "big scrap" between local authorities as part of a "huge bidding round in which councils try to please regional civil servants".
The government has guaranteed that 70% of HIP funding – worth £842m in 2003/04 – is to be allocated to councils according to existing national formulae. However, uncertainty remains as to the allocation of the remaining 30%. Within two years' time, regional boards will control HIP funding entirely.
Gwyneth Taylor, programme manager at the Local Government Association, said councils were waiting to see what would replace the existing formulae.
"Local authorities are getting more nervous – they have no idea what will replace the current system. Difficulties will arise when the regional strategy does not suit local needs," she added.
Source
Housing Today
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