Local Government Association Calls for Urgent Reforms to Right to Buy Scheme

In the face of a severe housing crisis gripping the UK, the Local Government Association (LGA) is spearheading a call for crucial reforms to the Right to Buy (RTB) scheme. Initially introduced in 1980, the RTB scheme was aimed at facilitating home ownership but has resulted in a concerning net loss of social housing stock year after year for local authorities. 

Current challenges

With over a million people languishing on council housing waiting lists and local authorities spending a staggering £1.74 billion annually on temporary accommodation, the urgency for change cannot be overstated. The latest figures paint a grim picture: in the last financial year alone, 10,896 homes were sold through RTB, yet only 3,447 have been replaced, leading to a net loss of 7,449 social homes in 2022/23.

Proposed reforms

The LGA’s position paper outlines comprehensive reforms to the RTB scheme, designed to empower local councils and stem the tide of housing losses. Key proposals include granting councils control over how and when funds raised through RTB are utilised for the development, delivery, or acquisition of new homes. Additionally, councils seek the power to safeguard their financial investments in social housing stock, ensuring transactions do not result in losses. Moreover, flexibility is crucial, allowing councils to tailor the scheme to suit local housing needs and market dynamics.

Concerns and analysis

One of the primary concerns highlighted by the LGA is the prioritisation of home ownership over access to secure and safe social housing. Rising discounts, coupled with restrictions on the use of RTB receipts, exacerbate this issue. Since 2012, a staggering £7.5 billion has been doled out in discounts, further compounded by upcoming increases in maximum discounts, which could strain housing availability even more.

Government efforts and shortfalls

Despite government commitments to replace sold homes on a one-to-one basis since 2012, this goal remains elusive. Approximately 120,000 homes have been sold, yet only 44,000 have been replaced during this period. Restrictions on RTB receipt usage have hampered councils’ ability to effectively replace sold properties, contributing to a decline in social housing stock. The LGA warns that without significant changes, a further 100,000 homes could be sold by 2030, with only 43,000 replacements projected.

Call to action 

Now, more than ever, urgent action is needed from the government to remove restrictive rules and empower local authorities to address the housing crisis effectively. Councils must be given the autonomy and flexibility to utilise RTB receipts in a manner that aligns with the needs of their communities. Failure to act swiftly risks exacerbating the already dire shortage of social housing, leaving vulnerable individuals and families without essential shelter.

Cllr Darren Rodwell, Housing spokesperson for the LGA, said:

“We are facing a significant housing shortage in this country which has pushed council budgets to the brink as they struggle to find suitable homes for an ever-increasing number of people. 

“Whilst the Right to Buy can and has delivered home ownership for many, the current form does not work for local authorities and many of those most in need of housing support are simply unable to access secure, safe social housing. 

“It is time for the Government to overhaul a system which has seen our social housing stock significantly diminish. If the Government adopts our proposals this would allow councils to resume their role as a major builder of affordable homes, which support strong and healthy communities and help to build prosperous places.”