Two major announcements for local government came out of conference season, both from Conservative Conference.
The most reported part of the Chancellor’s speech was that business rates would in future be retained by councils. Even without the ability to vary rates in both directions this could be great news, yet councils have responded with considerable scepticism.
Four years ago the Government made a similar announcement, only for us to find when we worked through the detail the actual amount left to councils didn’t even cover cuts to our Revenue Support Grant.
Around that time the Government demanded a quarter of a billion pounds from Crawley in return for local control over council housing rents, that is until the Government decided to reassert control last July leaving councils hundreds of millions of pounds worse off.
When we compare what Crawley raises in rates against what we get back, we stand to benefit the sixth most of any English authority. Even shared with county the increase dwarfs everything we currently spend on services. Experience suggests that’s just not going to happen.
The second announcement was the Prime Minister’s declaration on ‘starter homes.’ These are properties for first-time buyers valued up to £250,000 with a 20% discount. I don’t know if Cameron is aware of what the UK’s average salary is, in Crawley it’s under £23,000, even with the discount a first-time buyer would need to earn £50,000 a year to afford one of these homes.
Better than nothing? No. Under the current system each new development must include 28% council housing, with a further 12% genuinely affordable starter homes. With this new policy Cameron is letting developers decide what to build, which if they’re interested in making money means our 40% affordable requirement will be limited to properties for those earning £50,000 or more.
So no new council houses, affordable housing only for those on £50,000 and everyone else left to the private rental market. Starter homes aren’t a bad idea, but let’s have a discount which makes them genuinely affordable, instead of a policy which only benefits developers and buy-to-let landlords.