David Beavan, deputy leader of East Suffolk Council, calls for greater grants for more council housing, with Lowestoft St Peter’s Court development to be demolished; MP Dr Therese Coffey pushes back
A leading councillor has said council housing is at risk of disappearing completely unless drastic changes are made.
David Beavan, deputy leader of East Suffolk Council (ESC) and cabinet member for housing, has said that his administration’s hands are ‘tied behind our back’ by the Government, and that by 2027 they could have less council homes than when they were elected.
He says because the council is restricted to the formula social rent, which is 32 per cent of average rents, they cannot be competitive with registered social housing providers like Newtide.
However, MP Dr. Therese Coffey has said that Cllr Beavan is ‘simply reneging on his promises’ and that the finances are there for the council.
Cllr Beavan said: “We can’t afford to build at present, without big grants we can’t afford to do it . It’s going to be the end of council housing.
“When I took over the HRA (Housing Revenue Account) last year there was a deficit of over £30m – £9m owed because tenants had been overcharged, which equates to a £28m loss of income over the life of the HRA business plan.”
In March last year, the council owned 4,418 homes and this year it has built 25 new homes but lost 10 to right to buy (RTB) sales. A further 90 will be lost in the coming year, the majority due to the demolition of St Peter’s Court, in Lowestoft, as it was beyond economic repair.
Newtide Homes, a registered provider, built 600 new homes in East Suffolk and North East Essex last year at a return of 3.7 per cent, of which 100 charge social rent.
Cllr Beavan continued: “How can we ever be competitive with our hands tied behind our back by the government? Either increase the Homes England grants or allow us to charge rents we can afford to build at – raising housing benefit to the 50th percentile for the poorest.
“As we build less stock our income will fall; as our income falls we will have less money to replace stock. Our ageing stock becomes harder to maintain and retrofit, the very definition of a wasting asset that will eventually lead to the end of council housing.
“We promised 500 more homes but we’re going to end up with 24 less unless things change.”
Cllr Beavan stated that the HRA Business Plan is being reviewed and re-written, to be presented to members in March.
He also further asserted that he is confident ESC’s staff have the capacity for new ideas, and that the council as a whole will rise to the challenge.
Suffolk Coastal MP Dr Therese Coffey pushed back against Cllr Beavan, saying: “Sadly, it seems that Cllr Beavan is simply reneging on his promises on council housing.
“The council’s own accounts show a surplus of £5m on the Housing Revenue Account in the year and is on track to manage its long-term financing with reserves specifically set aside to build new social housing right across East Suffolk.
“If Cllr Beavan really wanted to do this, he could seek to use the reserves or apply to the public works loan board.”
The announcement of the proposed demolition of St Peter’s Court came in October last year.