Down the years, such policies have been supported by a view in some quarters that social housing is nothing more than an ambulance service for the accommodationally-challenged. This has been reinforced by the UK’s near-unique cultural obsession with home ownership as the gold standard of tenure. But, of course, as fewer and fewer of those under the age of 35 can see any hope of one day owning a home, this is starting to shift.
A younger generation looks to the rest of northern Europe, which has no trouble accepting the notion that affordable, well-funded and well-maintained social housing is an essential component of a truly healthy housing market, alongside ownership and the private rental sector, and that this is very much the business of government. Current policymakers somehow persistently forget – as our outgoing chair Mike Ainsley has often pointed out – that social housing has been with us in one form or another since feudal times. No society, no economy thrives without it.

SO, AS THE NEXT TREASURY budget statement looms, it has been a refreshing step forward in recent months to deal with a government that says it is committed to developing a long-term plan for housing. NFA members, council housing managers and housing associations are enthusiastic and keen to play their part. We know that whatever happens next will have profound implications for the new government’s two key housing priorities; improving the quality of social housing and services, and creating 1.5 million new homes during this parliament. However, the proposals we’ve heard so far are unlikely to deliver either – and I question whether the policymakers fully understand the scale and complexity of the problem, particularly in the local authority sector. 

So much of the sector’s capacity to build or acquire has been stripped away since the mid-2000s that many landlords have been driven back to the starting blocks – they now lack the necessary knowledge, skill and resources

I see four big, critical calls to action ahead if we’re to make any headway at all.

• Central government oversees the setting of council home rents. The government is so far only committed to consulting on a five-year agreement to allow rents to increase by a maximum of CPI +1% each year. But five years doesn’t give enough income certainty to allow landlords to plan, improve and invest in their stock, let alone build more homes.
• Our members are asking for at least a 10-year settlement.

• Current proposals make no mention of the rents that have dropped behind Formula Rent levels, often as an unintended consequence of previous policy. For some councils, these rents no longer cover costs and are a significant drain on their finances, yet there is no mechanism they could use to put this right.
• A new flexible settlement should make sure all rents eventually converge. Research shows that this would considerably improve councils’ ability to invest in their existing homes and still keep rents affordable

• Our members also believe current proposals don’t go far enough. They want legislation to compel future governments to compensate councils for any cuts in social housing rents. At the very least, they want a minimum notice period for any policy change that would cut their housing management income.
• For instance, given the unexpected policy swerves of the last decade, they want guarantees that will stop future governments treating social housing rents as a political tool.

• But also missing from current discussion is a pragmatic acknowledgement from central government that rent policy alone cannot support the social housing sector to make any contribution to the 1.5 million homes target. So much of the sector’s capacity to build or acquire has been stripped away since the mid-2000s that many landlords, though eager to contribute, have been driven back to the starting blocks and now lack the necessary knowledge, skill and resources.
• This means that, alongside sufficient extra funding for social landlords to invest in building safety, decarbonisation and Awaab’s Law upgrades to existing homes, a much more ambitious Affordable Homes Programme must come on line, preferably from April 2026, with substantially raised grant rates.

It’s right to ask what the impact on tenants would be of all these asks. Social sector rents are, relative to earnings, still more affordable than they were a decade ago and, even with the planned increases, are much more affordable than private rents.

And what of public finances – the core issue that is driving all those anguished macro policy discussions? Well, it isn’t as if the sector is holding out its cap and offering nothing in return. Research by Pragmatix Advisory for the LGA, ARCH and the NFA in 2021 calculated that building just 100,000 new social rent tenure homes in the local authority sector each year – a mere 6.6 per cent of the government’s new homes target – would deliver the equivalent of £24.5 billion to the Treasury over 30 years.

This represents a £15bn boost to the general economy; and much of the money spent on new-home construction stays local and so is targeted at the communities that need both the homes and the jobs.

In short, what we need is a rent policy that is part of a big-picture, long-term housing strategy – and national policy debate – that clearly sets out the goals we’re all aiming for and takes account of how much it will cost to achieve those objectives.

Government has made a good start, but could do better – and we can help them.