Right to Buy policy may make housing crisis worse, MPs claim

Government plans to extend Right to Buy to Housing Association tenants heavily criticised by group of MPs.

A report from the Public Accounts Committee (PAC) has questioned how the Right to Buy will be funded, and whether proper replacement homes will be built.

The government’s controversial plan to extend the policy to Housing Association tenants has been criticised by an influential committee of MPs, who say the pledge has not been costed accurately, is open to abuse and may worsen the UK housing crisis.

The idea of the scheme is to allow Housing Association tenants to buy their own homes, with discounts similar to those enjoyed by council.

The MPs said there was evidence that Right to Buy could increase overcrowding for those in housing need, and that increased discounts for Housing Association tenants could lead to greater fraud. They also reported that ministers have failed to provide basic information on how the scheme would work.

The committee, which is made up of both Conservative and opposition MPs, said the Government should provide “a full analysis showing how this policy is to be funded, provide a clear statement of where financial and other risks lie, and spell out its contingency plan if its policies prove not to be fiscally neutral”.

The policy has previously been rejected by the government of Wales and Scotland, and criticised by Local Government Association, and the Institute for Fiscal Studies (IFS).

The extension of Right to Buy, which is currently being piloted in five areas of England, will be funded by the councils selling off their most valuable council houses according to the government, which promise that all the homes would be replaced.

But the MPs concluded that the government’s commitment “will not ensure that these will be like-for-like replacements”.

Potential buyers will see discounts of up to £103,900 in London, and £77,900 elsewhere, with half a million Housing Association tenants already eligible, and a further 800,000 will become eligible later this year.

The scheme is due to be rolled out across England later this year.

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