The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham): From 1 April 2012, the Mayor of London has had oversight of strategic housing, regeneration and economic development in London. Details of the amount of
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funding allocated to the named developers from the 2011-15 Affordable Homes Programme and expected outputs for affordable rent and low-cost home ownership properties in London can be found on the Homes and Communities Agency's website at: www. homesandcommunities.co.uk/affordable-homes.
To ask Her Majesty's Government what formula was used to determine the £14 million reduction in the level of historic debt to be redeemed prior to the introduction of housing revenue account self-financing in the London Borough of Tower Hamlets between the consultation paper in 2010 and the final determination in 2012.[HL1589]
Baroness Hanham: The self-financing settlement was subject to a lengthy process of assessment and reassessment in close consultation with all stock-owning local authorities. The early figures were necessarily indicative and as the process developed we made changes to the methodology, updated key data (such as stock numbers and rent levels) and made adjustments regarding changing inflation rates.
We published several models between 2010 and the final determinations in 2012, alongside detailed commentaries, which showed and explained clearly how and why each council's valuation and settlement payment changed over time. These consultation documents are on the department's website.
To ask Her Majesty's Government what level of right-to-buy sales were assumed in the calculation of the level of debt allocated to the London Borough of Tower Hamlets under housing revenue account self-financing.[HL1590]
Baroness Hanham: I attach the figures below, which were published on 1 February 2012 and can be found on the department's website at www.communities. gov.uk/publications/housing/selffinancingdeterminations.
Where right-to-buy sales are higher than predicted under self-financing (such as due to the recent increases in discounts) then a proportion of the receipt may be used by the council to pay off the debt related to the additional sold properties. In other words, the local authority will always have sufficient income to service debt.
| Tower Hamlets-Forecast number of Right to Buy sales in self-financing | |||
To ask Her Majesty's Government why they are limiting the level of right-to-buy capital receipts used in the development of new council housing to 30% of development costs; and whether they will allow local authorities to utilise general fund and housing revenue account reserves to supplement that capital funding.[HL1591]
Baroness Hanham: For the first time, every additional home sold under right to buy will be replaced by a new home for affordable rent. We have limited the level of right-to-buy capital receipts to 30% based on evidence from the 2011-15 Affordable Homes Programme. As in the Affordable Homes Programme, the remainder of the cost will come from borrowing against the net rental income stream from the new property, and cross-subsidy from the landlord's own resources. Under the reinvigorated right-to-buy scheme, the right-to-buy receipts effectively replace government grant and by restricting use of receipts to no more than 30% of costs we not only ensure value for money but maximise the number of new homes built.
If an authority wishes to limit its borrowing, there is certainly nothing to prevent it using its reserves to contribute towards new development.
Hansard Link: Housing
