Douglas Borough Council has come out broadly in favour of the general principles contained in the Isle of Man Government’s housing review report into public sector housing in the Isle of Man.
The Council has said, however, that it is concerned that the review’s recommendations do not include devolving wider powers to local authorities, in particular in relation to government relaxing control over authorities’ management of public sector housing stock.
Council Leader Councillor David Christian JP said: ‘It is important to make clear at the outset that the Council finds it regrettable that, as the Island’s largest housing authority, it was not consulted during the review process. Members have studied the review closely and while, in the main, we agree with the overall findings, we are deeply concerned that there is no call for a restructuring of local government that would allow authorities to have far greater autonomy than at present. To put this in context, despite being the Island’s largest authority with around 2271 properties and a housing stock valued at in the region of ?227million Douglas Borough Council has only limited control over decisions relating to the management of its most valuable asset; and this at a time when we have reviewed and made substantial improvements to our housing service. It is government, not the Council, that approves rent levels which then determines how much we may spend on maintenance. This not only compromises how we can best serve our tenants but also places a reliance on deficiency funding support which, in turn, impacts on how we deliver value for money to our ratepayers.
‘With its reinvigorated housing service Douglas Borough Council is well placed to set its own rent levels. This would allow us to maintain and manage our housing stock without the need for deficiency funding from the Department of Social Care. Regrettably government policy has led to rent levels being kept artificially low for some years now. This, in turn, has led to the deterioration of our housing stock, which has required us to borrow capital for refurbishment, rather than for providing new affordable housing. It is also a policy that has contributed to increasing the financial burden on the Island’s taxpayers.
‘The Council has submitted a detailed response to the review in which we set out how, were we allowed the freedom to set our own rent increases, rent levels would be significantly lower than those suggested by government and could amount to savings to the average tenant of around ?1774 over the four-year period 2013-2017.
‘The report indicates that the rent for an average three-bedroom house would increase from ?74 as of April 2012 to ?143 in April 2016. While accepting that increasing rents is the only way for public sector housing to become financially viable and ease the pressure on the public purse the Council believes its own housing model, designed to maximise efficiencies, could allow for an increase to only ?127.
‘Simply put, if the Council were to resume full control of its housing stock including setting rent levels and determining expenditure priorities, reliance on deficiency funding and the rate-funded housing subsidy could be eliminated within four years.’
Referring to the review’s proposal that a single housing authority in the Island be formed Councillor Christian said: ‘The Council would not be in favour of such a measure because we believe it could compromise how Members - and indeed Commissioners elsewhere in the Island - were able to serve their electorate regarding how best to respond to regional variations in housing need, for housing provision is essentially about local authorities recognising local communities’ requirements. The Council would, however, consider offering its own housing service to neighbouring areas via joint housing committees or similar mechanisms if this were perceived as an agreed and equitable way forward.’
The report also proposes a review of eligibility criteria. ‘In principle the Council welcomes the proposal and would support a reduction in the maximum income levels determining eligibility,’ explained Councillor Christian. He continued: ‘The Council does not, however, support means testing overall, but agrees that tenants receiving housing benefits should be means-tested regularly to ensure those benefits reach those most in need.’
Councillor Christian concluded: ‘While in the main the Council shares and supports the government’s stance in this review, there are some areas - in particular those relating to autonomy, self-financing and asset management - where far-reaching and detailed further consultation will be needed if we are to arrive at an equitable long-term solution that delivers quality affordable public sector housing which places minimal, if any, additional financial demands on either ratepayers or taxpayers.
‘This review has initiated a much-needed conversation between government and public sector housing providers. That conversation is clearly set to continue for some considerable time.’
Photo caption: Council leader David Christian. Photo Andrew Barton
