Concerns mount at Right to Buy extension

Co-operative housing organisations and community land trusts are on high alert in case the government’s newly announced Right to Buy provisions for housing association tenants affect community-led housing...

Co-operative housing organisations and community land trusts are on high alert in case the government’s newly announced Right to Buy provisions for housing association tenants affect community-led housing initiatives.

The community land trust movement in particular is concerned at what could be included in the Conservatives’ as-yet unpublished Housing Bill. Recent years have seen a rapid growth in community land trusts (CLTs) in Britain.

These are democratically controlled grassroots ventures in rural and urban areas which focus on providing affordable housing where the commercial housing market has failed.

Catherine Harrington, director of the National CLT Network, says her organisation will be lobbying hard to ensure CLTs are excluded from any Right to Buy provisions.

“We’re going to be arguing for exemption until we’re blue in the face,” she says.

The central tenet behind the CLT idea is that land and property is held permanently in trust on behalf of the community. But, depending on the exact provisions of the Housing Bill, those CLTs which rent homes at affordable rents to tenants could find themselves losing their properties through Right to Buy applications.

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As Ms Harrington points out, such a development could be potentially disastrous to the CLT concept.

If CLTs were to be caught under Right to Buy legislation, those most vulnerable would be the trusts who have chosen to become ‘registered providers’ of social housing, or who have entered into partnership agreements with an existing registered provider such as a housing association.

These are the two alternative routes typically followed by CLTs who want to access grant funding for new developments through the Affordable Homes Programme run by the government’s Homes and Communities Agency.

A further anxiety is that local authorities – which have, in a number of cases, passed development land to CLTs for affordable housing at below market value – may adopt a more unbending approach. Local authorities, already bearing the brunt of public sector funding cuts, are intended by the government to be the agents who will refund housing associations for losses incurred through Right to Buy.

“As always, the devil will be in the detail. We won’t know until a draft bill is published how the government intends to implement Right to Buy,” says David Rodgers, chief executive until his recent retirement of CDS Co-operatives, former president of Co-operative Housing International and now an elected member of Labour’s housing executive committee.

He says the government would be foolish to try to extend the provisions more widely than housing associations – but adds: “I’m surprised they’re foolish enough to do this anyway. It’s just a nonsensical policy.”

Before a new Housing Act is passed, the details will be subject to scrutiny in the Commons and the Lords, offering an opportunity for organisations such as the National CLT Network to undertake detailed lobbying work.

Margaret Thatcher’s Housing Act 1980 included a number of exemptions from the first Right to Buy provisions, which included some types of rented housing (including almshouses and council houses in national parks and scheduled rural areas). The expectation is that the new legislation will also include certain exemptions which could potentially assist those CLTs operating in villages and small rural towns.

Another possible lever to be used in the lobbying work is that many CLTs are in rural, Tory-held seats. “Local Tory MPs won’t necessarily want to be against their CLT,” says Nic Bliss, chair of the Confederation of Co-operative Housing (CCH).

His organisation is also closely watching developments in David Cameron’s scheme and is preparing to engage in active lobbying.

Nevertheless, housing co-operatives (or at least fully mutual housing co-operatives, those where co-op membership is a condition of tenancy) are arguably likely to be less at risk. Fully mutual co-ops are already exempt from Right to Buy and the separate Right to Acquire provisions for housing associations, not least because shared membership of a co-op can be already construed as a form of home ownership.

One concern raised by Catherine Harrington is that the government seems determined to bring in the new legislation very quickly. The Right to Buy pledge was pushed by Mr Cameron at the first Prime Minister’s Questions of the new Parliament, and Ms Harrington says the Government has indicated a desire to bring in the Housing Bill in its first hundred days. Her organisation met in early June with other community-led housing organisations, including the Confederation of Co-operative Housing, to discuss joint work.

But a new Housing Act could also offer opportunities.

Community land trusts are already subject to statutory definition (in the Housing and Regeneration Act 2008), but the wider community-led housing movement has not, as yet, been formally defined in legislation.

Ms Harrington says the new Act could be a good opportunity to rectify this. Provisions to exempt CLTs and similar community-led housing ventures from leasehold enfranchisement requirements could also help meet a long-running concern of the movement.

And ironically, assuming that fully mutual co-operatives remain exempt from Right to Buy provisions, it is conceivable that the new legislation could actually encourage a new upsurge of interest in the co-operative housing solution, as an alternative to traditional housing association models.

At the moment, however, the focus is firmly on the risks posed by Right to Buy – and the legal advice to support the lobbying work is already being sought.

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