Councils have been forced to sell off enough properties to house a small city, such as Oxford, and are being prevented from building the replacements needed, local government leaders have warned.
Only a third of the money generated from homes being sold under the right-to-buy scheme (RTB) can be kept by authorities and they cannot borrow to make up the shortfall needed to fund replacements, according to the Local Government Association (LGA).
Councils have called for rules to changed to allow them to build new homes (PA/ Gareth Fuller)
It warned the scheme, which allows residents to buy their social housing, will grind to a halt if councils are not given the financial powers to replace sold homes.
Since 2012 about 54,500 homes have been sold off and some 12,400 replacement homes started, according to the LGA.
The shortfall of 42,100 properties is equivalent to the population of Reading, Canterbury or Oxford, it said.
It called on Mr Hammond to allow councils to keep all right-to-buy sales receipts and have more freedom to borrow to invest when he makes his financial statement on November 22.
LGA housing spokesman Martin Tett said: “Current RTB arrangements are restricting councils from being able to replace homes being sold under the scheme.
“RTB will quickly become a thing of the past in England if councils continue to be prevented from building new homes and replacing those sold.
“If we are to stand a real chance of solving our housing shortage, councils need the funding and powers to replace any homes sold under RTB quickly and reinvest in building more of the genuine affordable homes our communities desperately need.”
Conservative John Penrose has called for planning reforms (PA/ John Stillwell)
Tory former heritage minister John Penrose backed calls from housing firms for reforms to make it easier to “build up not out”.
Permission for urban property owners to build up to the height of the tallest building in the same block, or to the height of mature local trees, would be automatic under the proposals.
Mr Penrose said: “Building up, not out, is greener, because we don’t have to concrete over more green fields, will breathe fresh life into hard-pressed traditional town centres and create mansion blocks, Georgian terraces and mews houses rather than controversial sky-high tower blocks, so that our towns and cities will become prettier too.”
More cash is needed to ease the social care crisis, campaigners say (PA/Joe Giddens)
Meanwhile, campaigners called for an extra 1% on National Insurance contributions to generate up to £5 billion extra to fund over-stretched social care.
The move would be the most “progressive” way of easing the pressure on the system, research by charity Independent Age and the IPPR think-tank found.
It would mean the poorest working families lost out by £20 a year compared with £1,220 a year for the wealthiest homes.
Harry Quilter-Pinner, research fellow at IPPR, said: “Pressures on quality and safety on the frontline are now at a dangerous tipping point.
“In their manifesto at the last election the Government promised to lead on social care ‘where others had failed’.
“They must now deliver on this promise with a long-term sustainable funding settlement urgently needed.”
Source: Press Association