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No higher-value asset payments in 2018/19, Javid confirms
Councils will not be forced to sell off any higher-value council homes before at least April 2019, communities secretary Sajid Javid has confirmed.
Under the Housing and Planning Act 2016, introduced by David Cameron’s government, local authorities are expected to pay a levy to government which they make up through selling their most valuable homes when they become vacant.
The policy was intended to fund an extension of the Right to Buy to housing association tenants.
However, it has yet to be implemented and there have been few recent announcements on the levy, leading councils to warn that the resulting uncertainty is making it difficult to form Housing Revenue Account (HRA) business plans.
Mr Javid has now revealed in a letter to a London councillor that “local authorities will not be expected to make a payment in 2017/18 or in 2018/19”.
Former housing minister Gavin Barwell had already confirmed during an interview with Inside Housing in November 2016 that the levy would not come into force in 2017/18.
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Councils’ fears about the sell-off have been heightened since the Autumn Budget last month, when it was revealed that a pilot of the Right to Buy extension will take place in the Midlands from July 2018, funded by the Treasury.
It had previously been rumoured that ministers had dropped the two policies.
“Forcing councils to sell off much-needed council homes makes no sense,” said Diarmaid Ward, executive member for housing and development at Islington Council, who received Mr Javid’s letter.
“The secretary of state’s announcement that councils will not have to make payments for two years is a big win for our campaign, but we need the government to drop this policy altogether.”
Islington estimates it would be made to sell around 300 homes a year under the high-value asset levy – the greatest impact of any council in the country.
Mr Ward has tweeted Mr Javid every day for 61 days asking him to drop the policy, but said he would stop “for now” following the communities secretary’s letter.
Letter from @sajidjavid today "local authorities will not be expected to make a payment in 2017/18 or in 2018/19"
— Diarmaid Ward (@diarmaid_w)
Good news but this policy needs to be completely binned
No more tweets for now but the fight continues #Day61 #StopTheSellOff #ByeforNowLetter from @sajidjavid today "local authorities will not be expected to make a payment in 2017/18 or in 2018/19"
— Diarmaid Ward (@diarmaid_w) December 19, 2017
Good news but this policy needs to be completely binned
No more tweets for now but the fight continues #Day61 #StopTheSellOff #ByeforNow
John Bibby, chief executive of the Association of Retained Council Housing, said: “The announcement that the government will not expect councils to pay a high-value asset levy in 2018/19 is to be welcomed, however the continuing uncertainty about the amount and timing of any future levy is a major drag on investment in new housing through the HRA, making it prohibitively risky for many councils to commit to significant housing investment plans, whether in improvements to the existing stock, or new building.”
A spokesperson for the Department for Communities and Local Government said: “We are considering how to implement the legislation on Higher Value Assets under the Housing and Planning Act 2016.”
A full copy of the letter is attached below.
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Update: at 14.29pm, 20/12/17: The story was updated to include a comment from John Bibby.
Update: at 16.26pm, 20/12/17: A comment from the DCLG was added to the story.
