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Page last updated at 16:30 GMT, Friday, 23 January 2009

Council housing revival?

Milan Radulovic
Milan Radulovic
for the Politics Show East Midlands

On East Midlands Politics Show on 18 January, Housing Minister, Margaret Beckett, revealed the government is to make it easier for councils to build their own houses again. We asked Broxtowe councillor and Chair of the Association of Retained Council Housing, Milan Radulovic, for his response...

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Housing Minister, Margaret Beckett, tells the East Midlands Politics Show how the government plans to help people desperate to find homes.

During my many years as a politician, I have seen council housing go from being recognised by all parties as a vital national asset, to a stigmatised poor relation of housing associations and private developers.

As portfolio holder for housing at Broxtowe District Council, one of some 100 local authorities in England that between them still own and manage one million council properties, I have been saddened to see that tenants and residents in council homes do not get as good a deal as those in private or other socially rented housing and councils have not had the same freedoms and finances to build as other providers.

Yet the fact is that residents have voted for them to own and manage their homes.

Milan Radulovic
My own authority and Arch welcome housing minister Margaret Beckett's latest consultation on changes to revenue and capital rules for new council housing
Milan Radulovic

Some councils, such as my own, have managed to build despite being starved of resources for decades.

But direct council building has been in the hundreds per year nationally, not in the thousands we would like to see.

Association established

Broxtowe banded together with other stock retaining councils to set up the Association of Retained Council Housing (Arch) to campaign for a better deal for council tenants and residents.

Working together, stock retainers of all political colours have made inroads in getting the voices of people who live in council properties heard.

We are part of the government's formal review of housing finance system, the Housing Revenue Account (HRA).

Our submission to the review will seek alternatives to the current situation, which means council rents are disappearing into a national pot that totals 200m and is set to rise, but has no guarantee of being used for housing.

We at Arch have also argued that councils, which are democratically accountable, have good credit ratings and with well-monitored performance records are ideally placed to build new homes.

This is particularly true in the current economic downturn where private sector and housing association developments are stalled due to lack of finance.

Long overdue

This is why both my own authority and Arch welcome housing minister Margaret Beckett's latest consultation on changes to revenue and capital rules for new council housing.

Its proposals, to enable councils to retain more locally raised income to be spent on affordable housing and promote councils as affordable housing providers, are long overdue.

This is, without doubt, a step in the right direction towards councils taking their rightful place in helping contribute towards the government's target for three million new homes by 2020.

The proposals, as they stand, only relate to a minimal number of properties however and we would like to see the principles suggested applied more broadly and without imposing undue bureaucratic restrictions.

The consultation must also be looked at in the wider context of the way council housing is funded and the outcome of the review of the HRA system.

We hope the minister's announcement is a signal that retained stock councils will be allowed greater financial freedoms.

With the right framework in place, local authorities could not only help to once again build good quality homes to meet pressing national shortages, but also help stimulate the struggling construction industry in these difficult times.

Watch the Politics Show in the East Midlands with Marie Ashby at 1200 GMT on Sundays, on BBC One.

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