London Councils has welcomed a new report from a cross-party parliamentary committee pointing to serious financial pressures on the social housing sector.
A London Councils spokesperson said:
“Without more government investment it is hard to see anything but a bleak future for social housing.
“Our analysis shows London boroughs face a black hole of £700m in their social housing budgets over the next four years, despite the desperate need to improve housing conditions and build new homes in the capital. With resources massively squeezed, it feels like we’ve been left with mission impossible.
“Social housing is crucial to tackling London’s homelessness crisis. It’s a vital component of the capital’s social and economic success, and we should all want the sector to thrive. Boroughs are as keen as ever to work with ministers in ensuring more resources are secured for boosting social housing in London and across the country.”
London is grappling with the most severe homelessness crisis in the country and over 320,000 London households are on social housing waiting lists. London Councils estimates that one in 50 Londoners are homeless and living in temporary accommodation arranged by their local borough.
Boroughs are determined to keep increasing delivery of new affordable homes in the capital, including social housing, but high construction costs and interest rates have led to many projects becoming unviable without additional funding.
In March, London Councils shared its analysis revealing a £700m pressure on boroughs’ housing revenue accounts (their budgets for managing social housing stock). This is due to costs significantly outpacing the income boroughs can expect from social rent levels, which are set nationally by the government and have led to a substantial real-terms reduction in funding available for social housing.
The decision in the last Budget to remove councils’ ability to retain 100% of receipts from Right to Buy has further squeezed funding at a time when both need and costs are growing.