11 November 2016
Pay to Stay meetings cancelled as policies face delays
Meetings of the Government’s Pay to Stay working group have been cancelled as several key measures in the Housing and Planning Act look set to be delayed.
Inside Housing can exclusively reveal that the Government has cancelled scheduled meetings despite the policy- under which higher earning tenants pay up to market rent- originally being planned for implementation in April next year.
It is not clear why the meetings have been cancelled, but sector figures this week said it suggested a delay. Councils have been urging ministers to put the start date back to give them time to prepare.
The news emerged days after a senior civil servant admitted the Right to Buy (RTB) extension to housing association tenants is set to be delayed as a result of the Brexit vote.
Housing minister Gavin Barwell also said this week that councils “need plenty of time” before implementing the higher value asset levy intended to fund the RTB extension, in response to a question about whether councils would still have to pay the levy in 2017/18 as expected. The government said regulations to implement Pay to Stay and the levy, along with RTB guidance, will be published in ‘due course’.
The Pay to Stay policy requires council tenants to pay up to market rent if they earn over £31,000, or £40,000 in London.
The Government has already taken several steps that water down the effects of the policy. Inside Housing reported last month DCLG was considering exempting council tenants in areas where social rents and market rents are similar and councils will be able to decide how to define market rent locally.
The Higher Value Asset Levy councils would be forced to pay also faces delay. Housing bodies had expected the Levy to be introduced from April next year. However, housing minister Gavin Barwell told the Communities and Local Government committee this week that no implementation date had been decided. He added he is “very aware” the legislation was “quite controversial” and the government will need to give councils “plenty of time” to implement the policy.
The Levy regulations were due to be published before the parliamentary summer recess in July but still have not materialised four months later. Experts said it would now be difficult for the policy to be introduced from next April. Clive Betts, chair of the CLG committee, said most councils are setting their budgets for next year and “haven’t got any idea what figure is going to be placed on them to estimate the high value assets”.
John Bibby, chief executive of the Association of Retained Council Housing, said if the voluntary RTB is delayed- as a civil servant this week said it would be – the higher value asset levy for councils should also be put back. He said ARCH would lobby “very strongly” for the levy to be delayed. He added: “If [the voluntary RTB] is not going to go ahead then there’s no reason to levy the councils.”
John Healey, shadow housing secretary said: “Ministers should recognise that on the Housing and Planning Act they may have won the legislation but they lost the argument. No-one thinks that forcing councils to sell off the best of their homes is an answer to the country’s affordable housing deficit. It can only make the problem worse.”
A DCLG spokesperson said nothing had changed with the higher value asset levy policy. He added: “We are currently considering how best to implement the policy to ensure it is robust and fair to councils. We will make an announcement in due course.”