§ Mr. Baldry
To ask the Secretary of State for the Environment when he will publish his proposals for a new financial regime for local authority housing; and if he will make a statement.
§ Mr. Ridley
My right hon. Friend the Secretary of State for Wales and I are issuing a consultation document today on a new financial regime for local authority housing in England and Wales. The paper has been placed in the Library and is available in the Vote Office. Copies will be sent today to local authorities and their associations.
A pattern has developed of major inconsistencies between authorities in the contributions to housing costs made by rent, rate and tax payers, and subsidies are not always being directed towards those authorities and their tenants who most need them. Also, although many authorities have for years pursued sound policies, anomalies in the system of different sources of subsidy have given rise to distortions in the incentives to efficiency and good management. Subject to approval of proposed legislation by Parliament, the new arrangements will take effect from 1 April 1990. These will require authorities to maintain a new-style housing revenue account which will reinforce the distinction between the provision of housing and other local authority functions. A new housing revenue account subsidy will replace a number of existing central Government subsidies and also local rate fund contributions from that date.
We intend that the new financial regime will make council landlords more accountable to their tenants and put tenants themselves in a position of greater equity as compared to tenants in other authorities.