One of the effects of the governments increased support for housing associations was the transfer of housing stock from local authorities to housing associations. Large Scale Voluntary Transfer (LSVT, as it was known as) resulted in many housing associations acquiring dwellings from local authorities. The extent of these changes can be seen by looking at trends in social housing stock.
In 1991, the total number of social housing stock was 5.8 million dwellings with 88% being managed by borough or district councils, funded by the government. In 2001, ten years later the total stock levels had declined by over 9% to just under 5.3 million homes. Today local authorities are now responsible for less than 70% of all social housing stock.
In the same time period the role of the housing associations has grown significantly, with total stock levels increasing by almost 130% and these organisations now represent around over 30% of all social housing stock in the UK, compared to just 12% in 1991. Today 170,000-200,000 units are being transferred each year as this trend has continued. These associations have essentially taken over from where traditional council housing left off. As housing associations role in the social housing market increased with more rights the role of the local authorities has diminished as more of their power is taken away.
Increased government funding for housing associations has also increased their status in recent years. The government provided substantial funds to housing associations to assist local authorities’ provision of housing for homeless and people in temporary accommodation. This saw the start of housing associations shift from the rehabilitation of housing towards the role of building houses which over the past ten years has continued to grow. Today housing associations have taken over from local authorities the responsibility of providing most of the new-building of social housing. Local authorities’ social building in contrast has declined to around 2,000 per year a fraction of what it once was.
Over the last decade there has been rapid expansion in production by housing associations, and a swelling of the total stock to a million dwellings by new building and large scale transfers from local authorities.
Through new building, stock transfer and rehabilitation housing associations have taken over from local authorities as the major providers of social housing in the past fifteen years. This has also seen the break up of the local authority sector. The effects of housing associations means that today around half the money raised for new homes comes from the public purse and the rest is raised privately as they have become the principle providers of new social housing.
The housing association sector has transformed in terms of both size and the legislative and financial frame work. These developments could bring even more changes in the future of housing associations.
The decline in local authority housing provision is primarily due to the underlying problem of a lack of public finance available for repairs, maintenance and new build. The backlog of repairs for council stock far outweighs the amount of public finance available and so the transfer of stock to housing associations, who are able to raise private finance, looks set to continue for the next ten years and even grow further. This means housing associations are highly likely to continue to be the main providers of social housing in the near future.
The current New Labour government has plans to bring all housing in the UK to an acceptable standard by 2010. The recourses needed to achieve this may leave many local authorities with no choice but to transfer their stock and result in the creation of even more housing associations.
There are however some concerns for the future. The privatisation of some housing associations has also emerged and is a trend that seems to be set to continue in the near future. These new commercial associations are now expected to run as private enterprises, moving away from traditional, not-for-profit organisations towards more commercial approaches. This raises issues if they are still independent voluntary led organisations and the effects this could have on the social housing sector which housing associations now dominate.
New Labour has recognised that investment in social housing needed to be increased. The way they decide to invest this money could have further effects on housing associations as well.
