Audit Commission

Summary [Download full report below this summary]

Governments have changed the housing finance system (both revenue and capital) that underpins council housing several times over the last two decades. This report looks at how the changes affect council housing services and rent levels. It describes how we expect the changes to affect councils as they strive to meet the government's objectives for council housing.

The key findings are:

1. provide local accountability for council housing management, investment and stock condition
2. encourage and reward high performance, minimising perverse incentives
3. provide a customer-focused approach to the provision of housing and housing services in a local market setting
4. establish an equitable relationship in each locality between charges, service standards and investment in council housing and neighbourhoods
5. promote self-sufficiency for each council, while allowing councils to respond flexibly to the circumstances of the local market, providing stability and predictability in their relationships with their tenants
6. support the government's objectives for council housing

Recommendations for the government to review the council housing subsidy system and also consider how the local housing revenue account (HRA) could reflect broader landlord costs, not just those associated with HRA dwellings. This would produce a better match between national priorities and local choice, result in greater equity between local authority and housing association tenants and support the government's liveability agenda.

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