Lambeth estimates that it will be £1billion short of the money needed for its social housing over the next 30-years due to the previous government’s policies of four years of rent reductions and a rent cap which reduced the rental income the housing budget relies on.
The details are set out in a new report on Lambeth Council’s ‘Housing Revenue Account’ highlighting the emergency measures needed to address the financial situation which threaten to undo the progress made in improving housing conditions in the borough.
The report also sets out that Lambeth Council is in discussions with the government to allow the council to borrow extra funding to offset the budget pressures and invest in the borough’s housing.
Cllr Danny Adilypour, the Council’s Deputy Leader and Cabinet member for Housing, Investment and New Homes, said: “The situation is stark. Short-term decisions by the previous government have taken £1bn out of our HRA over the next 30 years, seriously limiting the amount of money we have to maintain our estates.
“The council is committed to making sure council housing is up to as high a standard as possible, is repaired promptly when needed and meets the needs of residents. But we’ve been working with one arm tied behind our backs.
“The previous government-imposed caps and limits on our rental income, but without providing extra funding to make up the gap, which of course means there’s not enough money available to do all of the work on our estates that we know we need to.
“We’ve also been asked to do lots of extra work – without any additional money to fund it.
“Housing in Lambeth is ageing and needs investment, with most of our council homes being flats that are on average more than 60 years old. It’s a really difficult situation which is why we have been working closely with the new government to find a way forward.”
The Housing Revenue Account is a ring-fenced budget for estate repairs and maintenance for Lambeth’s tenants, and more than three quarters of its funding comes from rents. The previous government made councils cut rents without providing other ways of funding maintenance works.
The situation has the biggest impact on Lambeth as London’s second biggest social housing landlord with 23,600 socially rented homes and 10,000 leasehold properties, but is affecting boroughs across London and the rest of the country.
As well as rent cuts, the previous government introduced building and fire safety regulations without providing councils with extra funding. These requirements disproportionately affect boroughs such as Lambeth with higher levels of high-rise blocks and will cost Lambeth £76 million by 2028.
Cllr Adilypour said: “Previous government decisions to remove funding for the Decent Homes Standard also means that we have had little funding to invest in our ageing stock as its condition worsens.
“Despite these pressures, Lambeth continues to deliver for residents with the Regulator of Social Housing grading Lambeth a C2 result at their recent inspection, its second highest grading and the highest result for a London local authority.
“A key factor in their inspections is safety, and the grading reflects that in Lambeth 99.7% of council managed homes have fire safety assessments and 98.7% have gas safety checks.”
To read the HRA Budget, Rent and Service Charge setting report visit moderngov.lambeth.gov.uk.
