Yeah and £24m was for management fees for the ALMO.
Not sure that tenants should get tagged with regeneration costs, and then be told that they are being subsidised. so I factored out commercial rents and garage rents and only used dwelling rents and only the cost of maintenance on those rental properties.
Bit rich to moan about the cost to the taxpayer while the tenants are paying to regenerate properties that no one can use for the benefit of others. Even if they did fall short by £3m.
The council run the borough on behalf of and at the behest of the citizens, half of whom are council tenants. They are not only contributing to the upkeep of their own council house but to all council housing in the borough. It is similar to the idea behind state pensions- you are paying into a pot that is used to support yourself (in the future) and others (in the present). You could see it as a type of collectivism. The tenants of Newham are the collective and they ‘own’ all of the housing. As individuals they also occupy some of it:ermm:. The rest is in a state of disrepair due to (possibly) previous tenants subletting to people who don’t take care of their property and allow it to get into a state of disrepair…perhaps in a bid to be re-housed…or perhaps as a result of other local or government agencies failures.
I don’t agree with councils selling off quality housing too cheaply for a short-term boost to the coffers. In practice this is a ploy by the Tories to grab some votes. Many council houses were sold on in the 80’s for a quick profit and after a few transactions ended up as just as a expensive to buy as everything else on the private market…the only people who benefited from that were the tenants who won the lottery of being in the particular council home at the point when it was made available for sale to them. No- they should pay unemployed tenants to do up derelict and ‘Non-decent’ houses as maintaining these is the real drain on the public finances. Once finished the workers would have first dibs on renting the done-up homes at a reasonable market rate.
…and because the guy is a politician he doesn’t like to be too clear about what he means. I read it to mean that he believes ‘taxpayers’ are effectively contributing to the upkeep of sublet properties that aren’t being looked after properly because the subletting tenants aren’t accountable to an authority, only to the council tenant who is illicitly letting to them. If they wreck the joint the council tenant they are sub-renting from is hardly going to shout about it. And in those accounts from 2003 there was a ‘subsidy’ heading on the income side…in case you missed it 
I didn’t miss it.
The definition of a subsidy, just so we are all clear, is a grant of money to support something.
The figures clearly show that there is no such subsidy in place. The article I posted earlier shows that no such subsidy exists.
I will say one thing about the accounts of Newham, they remind me of the accounts and the way British Rail worked back in the day.
My department got a budget, it was £X a year, come Feb/March, we all got heaters for our offices, everyone got a heater, it wasn’t particularly cold and we had gone through Oct-Jan without them just fine, but we got heaters in Feb/March…why?
Because if my Department didn’t spend their budget, it was cut. There was no incentive to cut the budget, there was actually an incentive to make sure you spent every single penny.
I wonder if these councils are in the same position. That if they do not spend every single penny, their budgets are cut. So they devise a system whereby every single penny they get, they spend.
Our department justified what it did at British Rail on the basis that this year, maybe they were under budget because of particular reasons that might not exist next year. If their budget is cut they may end up in a position where they cannot afford to run their department properly, they run over a budget, and then the management get a bad mark, for coming over budget. They got no such bad marks for hitting their budget perfectly. So to protect themselves they aimed to spend every single penny they got.
To go right back to the beginning of this thread, Kaos is probably wrong.
Having built a few, probably about 500, council houses in my career as a local authority architect I can say with some certainty that council houses cost far more to build than speculative built houses.
Reasons? Well we used to work to quality and space standards beyond those of most spec. builders (pity about the design standards being generally cwap) and then there was always the “administration factor”. Far too many people involved in administering simple building contracts instead of leaving things to properly trained professionals.
Now factor in, after the first years contractors liability period, that council house tenants don’t have to pay for a structural insurance policy, don’t have to pay for getting fabric repairs done and, in decent authorities, often get a mid-life (30 year) upgrade carried out for “free”. (We all pay somehow.)
The “Housing Revenue” rarely, if ever, meets the “Housing Costs” budget which is generally propped up by grants and loans from central government.
Yup. They are subsidised rents. And I don’t care. I just think we need to build a lot more of the things and council should be much more flexible about co-ownership and the like and, for lords sake, get the building administration somewhere near efficient!
As I said above, efficiency cannot happen while budgets are cut when administrations come under budget.
I also dispute what you say.
Over a 25 year period the rental from a property is £60,000. How much did it cost to build a home 25 years ago? £57,000 was the average house price for new houses in 1987.
I doubt they were selling them for cost, so I doubt the price was more than £35,000.
So over 25 years the houses have more than paid for themselves.
A neat enough reply, but a bit short on logic.
I can’t quote building costs in the past (when I retired I did just that, and blanked huge amounts of now worthless knowledge) but your sums are flawed.
My structural insurance policy costs just shy of £400 p.a. Forgetting improvements to the property, I think I spent about £3,000 on maintenance, and much of that was DIY, last year.
Now try amortising that against a £90 p.a. rent with none of those costs and see where that goes.
I put up figures for what it costs to maintain the housing stock, £6m odd a year, compared to a revenue of £66m.
It is a fraction of the cost.
Yes regeneration of older properties will take considerable amounts of money, when ignored for 40 years and done under pressure of statute. If those were done reasonably over a longer period I don’t believe the costs would come to the point where Council homes were actually subsidised.
Taking the revenue of £66m, taking the maintenance costs of £6m, even if we add another £25m for management and administration, that is still leaving £35m a year. If you spent only £10m a year on regeneration, you would still have another £25m to spend on whatever else I might have missed.
£10m will regeneration a LOT of properties.
To be clear, my personal view is that everyone should have a right to a council house appropriate for their needs, to be measured on an annual basis or when there is a material change in circumstances, i.e. single couple, one bedroom council house, 1 reception, one kid, two bedrooms, two receptions (i.e. bedroom per occupant minus one for a couple, second reception for any kids). There should be a cap of four bedrooms - if you can afford more than 3 kids, you can afford to not be in a council house. Children can stay until they are 18, but as soon as they are 18, they come off your occupancy and there is a major change in circumstances. So last kid hits 18, you move into a 1 bedroom flat. Extenuating circumstance may mean a stay in change in circumstances, such as an anticipated further change in circumstances within 2 years. Rents should be market, but with a means tested housing benefit. Anyone who wants anything more can get their own place with their own money, and no housing benefit.
Fair, simple, provides housing on a needs basis to those who need it, probably reduces private sector pressure, and kills the buy to let market as a quick way to make a buck - leaves only larger institutional landlords. Perhaps some co-operation with existing charitable housing institutions, like the Guinness trust, would be needed to avoid unnecessary over-supply.
And for the record, I think it would be very difficult to get any council tax changes through that penalised people with excessively large homes. Perhaps the way to do it would be to have huge council tax bills with children discounts - encourage people with larger properties to have kids living with them. As soon as your kids leave, you get a council tax hike.
Where are these thoughts coming from, Kaos? Maybe from that worn book in brown cover at your bedside with hardly legible letters M A R X on the binding? :w00t:
