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Letter from the Office of the Deputy Prime Minister |
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Written by Austin Mitchell
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26 November 2004 |
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On October 28 Austin recieved a letter from John Prescott with regards to the fourth option. Read on...
Dear Austin,
I am aware that you have recently written to MPs stating that the Government is reviewing its Decent Homes policy with a view to create a ‘fourth option’, and understand that you have sent a letter to Local Authority Directors of Housing.
I am writing to you to make clear our position on the supposed ‘fourth option’.
The review mentioned in your letter was explicitly conditional on the mover of the alternative wording at the Labour Party conference agreeing to withdraw. The mover refused, so I will be taking no further action on this matter. There is not and will not be a ‘fourth option’ for providing direct additional funds to local authorities to meet the Decent Homes standard. We continue to believe the strategy we have in place remains the right one for delivering Decent homes, providing all local authorities with a level playing field and the opportunity to improve their stock and the lives of their tenants. The existing three options of ALMO, PFI and transfer are proving highly successful and there is no need to create alternative options.
Contrary to what you have said in your letters, I am not involved in any discussions about a ‘fourth option’, and the Government is not looking at any other options for delivering additional resources. Since 1997 we have already increased expenditure on council housing by 13% in real terms giving a total spend of £13 billion, in addition to the extra money made available for ALMOSs and PFI, and brought in by stock transfer. In addition, we cannot underestimate the importance of attracting private finance, as stock transfer has shown by levering in £5.3bn so far. The existing three options for additional resources are delivering very successfully and there is no need to create alternative options.
Local authorities are expecting to complete their options appraisals by July 2005 and within the present housing finance system, which this year is seeing greater freedoms introduced by prudential borrowing and increased M&M allowances above inflation. There is also the £180 million gap funding that has now been made available for local authorities wanting to transfer but with a negative stock value.
Local authorities have a big part in providing good quality homes for millions of people, and the package we have put in place ensures they can do this. However, it is tenants that we have laced at the heart of Decent Homes Programme, and it is they who help determine the future of their homes.
I am writing in similar terms to Council Leaders of stock owning authorities and have also asked that this letter be copied to their Chief executives of stock owning authorities to avoid any uncertainty.
JOHN PRESCOTT |
