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Orbit’s response to right-to-buy extension

Following the Conservatives' announcement of their intention to extend right-to-buy in their manifesto, Orbit’s Chief Executive Paul Tennant has issued the following statement:

Housing is a scarce resource and we are living with a housing crisis acknowledged by all. Politicians were very clear that housing was a scarce resource when implementing the Bedroom Tax. Yet now they propose to sell that very resource at a discount. So this feels like a policy motivated more by political expediency than meeting the needs and aspirations of people. 

Looking at the proposals, the numbers just don't add up. The costs of funding the discounts are estimated at £17b, money which would be much better used to build more homes, create jobs including apprenticeships for young people, and so generate income for the Exchequer. The concept of ‘one for one’ RTB replacement based on recent evidence is a myth; of the 26,000 homes sold in the latest RTB round only about 2,000 have been built. I want to be absolutely clear that opposing RTB is not about removing aspiration -  there are better options such as Shared Ownership to enable people to own their own home. 

With this RTB proposal we will see a further decline in the provision of homes for those unable to survive in the housing market. The previous RTB policy has contributed to the dysfunctional housing market both in terms of rented homes lost for people, and re-sales coming back as private lets. This in turn is destabilising communities. Affordable rent homes would also replace those sold thereby removing lower rent homes for those most in need. 

Government also needs to recognise that housing associations have kept the housing market going in times of crisis recently, the funds we can draw in and the homes we build make a huge economic contribution. Orbit will build 12,000 homes between 2013 and 2020. And we want to build even more if we can. But these proposals threaten future investment and potentially reduce our ability to provide the homes desperately needed in this country. 

A modern 10 year housing strategy with leadership and vision is what we need, rather than a series of short-term ‘fixes’ too often driven by political need at the time. We are doing all we can to tackle need and aspiration. We care about people and the communities where they live. And that is why we must make the social and economic case for alternative policies which are a better use of resource and will deliver more impact.