Blog 10th December 2018

Dec 10th 2018, 10:03

Blog 10th December 2018

In this week’s blog, I refer to: Local Authority Housing; Borrowing Cap; Right to buy; Self-Financing settlement; Grenfell; MHCLG; Brexit; Rory Stewart MP; Justice Department; European Union; UK Parliament; House of Commons; People’s Vote; UKIP; Bank of England; European Movement; Seminars and Training.

We have just launched our seminars on ‘Raising the Borrowing Cap: Opportunities for Local Authorities’ that will be held during April 2019.

There is general agreement that England is facing a ‘housing crisis’ and that a lack of social and affordable housing is a significant part of this. There is therefore an appetite in many local authorities to build new council homes as part of their response to the crisis.

This seminar looks in depth at the opportunities that have been created for local authorities by the government’s decision to raise the housing revenue account borrowing cap. These include opportunities to improve existing stock and construct or acquire new stock.

The seminar will address the following questions:

  • What is the context in which local authorities operate? What are the implications of raising the borrowing cap? How does the Prudential Borrowing system work?
  • How can new council housing be financed? How can improvements and major repairs to existing stock be financed?
  • The costs and benefits of a new build scheme. How to appraise a new build project?
  • How does building in the housing revenue account compare with other options? What opportunities may exist in the future?

If you want to take full advantage of the opportunities created by the lifting of the borrowing cap, this is the seminar for you!

For further information or to make a booking, please click here.


New Council Houses at Britwell, Slough

My view on the lifting of the borrowing cap is that it is not before time. In fact, it should never have been imposed in the first place. Hopefully it will enable local authorities to build thousands of new much needed council houses. But I think more needs to be done.

First, the ‘right to buy’ continues to deplete the stock of social housing. I think local authorities should be empowered to suspend the ‘right to buy’ if they think it appropriate.

Second, the self-financing settlement loaded local authorities with debt on the grounds that their rents would increase to pay for it. However, the government then forced councils to reduce rents from 2016 to 2019. This leaves them short of resources to build new homes. The Grenfell tragedy also demonstrated that councils have insufficient funds to carry out major repairs. I think that the self-financing settlement should be revisited, and some debt written off.

I made these points to the Ministry for Housing, Communities & Local Government in my response to their social housing green paper. To view or download a copy, please click here.

Last Friday I attended a ‘Brexit’ meeting called by my MP, Rory Stewart (Conservative), a Minister of State at the Justice Department. It was attended by around 200 people and I found it very interesting.

Rory Stewart believes that there is a need to ‘acknowledge the result’ of the referendum by ‘finding a middle ground’. He is a supporter of the Prime-Minister’s Brexit ‘deal’ because he believes that it is the ‘best way to heal a polarised debate’. He thinks that Britain has always had a complicated relationship with Europe that can only be solved by ‘stepping back’ and having a conversation about economic, cultural and social issues that could only be held if Britain was outside the European Union.

Having started the meeting by outlining his own views, Rory Stewart asked the attendees what they thought by asking people to respond to questions with a show of hands. He found that 50% of those present favoured a People’s Vote, 30% a ‘hard Brexit’ and 15% the Prime-Minister’s deal. In 2016 his Penrith & the Border constituency voted to leave.

He then invited questions that he defined as short sentences that could be concluded with a question mark! However, most of the questions that were asked did not meet this definition and instead consisted of statements that covered familiar ground, both for and against Britain’s membership of the European Union.

However, there were some interesting points:

First, while Rory Stewart argued that the Prime Minister’s deal should be supported, he conceded that it probably wouldn’t be approved by Parliament. However, he thought that the government would then negotiate with the Commons and the European Union based on finding out what changes to the deal would be required to get the deal through the Commons and explaining to the European Union that they would need to agree to those changes if they wanted to avoid no-deal. He expected that if the government dropped the ‘back stop’ the ‘deal’ may become acceptable to most Members of Parliament and that the European Union may accept that.

This may be an interesting insight into government thinking. However, I suspect that many parliamentarians don’t like any of the options that are on the table and so would like to imagine that other options could be pursued that in practice will not be available. If the ‘deal’ is voted down on Tuesday I think the government will find it difficult to negotiate another ‘deal’ especially one that does not include the ‘back stop’.

Second, Rory Stewart was against a People’s vote because it would be divisive and if it resulted in a vote to remain, people who had voted leave would feel ‘cheated’. If this happened, he predicted that a leave campaign would start straight away, large numbers would vote for the BNP and UKIP and that:

“Quite moderate people in this room would be quite tempted to break windows; and there would be a new supercharged UKIP.”

I found this statement rather worrying. Was he saying that the government was intent on pursuing ‘Brexit’ because of a fear of political extremism and violence?

Third, Rory Stewart made several interesting statements that I quote without comment:

“In Parliament at the moment there is no majority for anything.”

“There are people who want to deregulate and open up the United Kingdom market to the United States and India”

“I’m sure most of the people in this room don’t believe the Bank of England.”


Flag of the European Union

This week I have had three blogs published by the European Movement as follows:

Why my MP should support a People’s Vote

The Conservative Party’s history with Europe

The Problem with the new world order 

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