Largest local authority landlords call on government to save council housing

In March, directors from the cross-party group of councils gathered at a summit to address an “increasingly” urgent financial crisis. 

The Future of Council Housing summit, hosted by Southwark Council, aimed to inform a major new report, setting out a plan to fix the “broken financial model”. 

Ahead of the full report release later this year, authored by Toby Lloyd and Rose Grayston, the interim release summarises their recommendations.

The group said that an “unsustainable financial model and erratic national policy changes” have “squeezed their budgets and sent costs soaring”. 

Analysis from Savills showed that councils’ housing budgets will face a £2.2bn “black hole” by 2028.  

The council landlords’ report said: “Unless something is done soon, most council landlords will struggle to maintain their existing homes adequately or meet the huge new demands to improve them, let alone build new homes for social rent. 

“Rather than increasing supply, the reality is that some councils will have no option but to sell more of their existing stock, on top of Right to Buy sales, to finance investment in an ever-shrinking portfolio of council homes.”

Kieron Williams, leader of Southwark Council, said: “Our country’s largest council landlords have come together because we see every day how council homes transform lives for the better.  

“For families across our country their council home is a foundation, giving them the security needed to put down roots, flourish in childhood, get on at work, stay healthy and age well.

“However, erratic policy choices from our last government have left council housing finances completely broken and the system’s future is in danger. 

“Councils are being forced to cancel new build developments, and even sell off council homes, to focus on keeping their existing residents safe.

“We are releasing this interim report now, from England’s largest council landlords, because we want to work with the new government from day one to deliver the more and better council homes that our communities need. 

“With a growing number of council landlords on the brink, urgent action is needed to get our national council housing finances back on firm foundations.”

Jayne Francis, cabinet member for housing and homelessness at Birmingham City Council, said: “The demand for accommodation in Birmingham has never been higher. Since 2019, we have seen an increase in homelessness presentations of around 70%. 

“Currently, Birmingham has around 25,000 people on the housing register seeking a home.

“I see every day how council homes change lives for the better. Having a quality home to call your own gives people the stable platform they need to live a healthy life and to live it well. We want everyone in Birmingham to live in a warm, safe, sustainable home.

“Our current rate of house building cannot keep up with the current level of demand. If we continue as we are, the number of people that will benefit from the security provided by a good quality council home will dwindle. 

“Urgent action is needed and we want to work with the new government to deliver more and better council homes that our city badly needs.”

The 20 local authority landlords include:

• Birmingham City Council
• Bristol City Council
• Camden Council
• Dudley Council
• Royal Borough of Greenwich
• Hull City Council
• Islington Council
• Hackney Council
• Kirklees Council
• Lambeth Council
• Lewisham Council
• City of Wolverhampton Council
• Nottingham City Council
• Leicester City Council
• Newcastle City Council
• Rotherham Metropolitan Borough Council
• Leeds City Council
• Sandwell Council
• Sheffield City Council
• Southwark Council

Councils also met at a separate summit earlier in the year about the temporary accommodation crisis. They said that alone could spell the end of local government.