§ Mr. Clifton-BrownTo ask the Secretary of State for Transport, Local Government and the Regions if he will make a statement on the proposed changes in the rules relating to the use of right to buy receipts; from when the new rules will operate; what changes are envisaged for debt-free authorities; for what reason debt-free authorities will be required to set aside a percentage of prior receipts in future; what the percentage will be; how this money will be redistributed to other authorities: under what statement these changes will be introduced; whether it is Government policy to match exactly the higher allocations to support general borrowing as a result of the ending of the authorities' ability to finance expenditure from receipts; which authorities he estimates will be affected, and how much will be redistributed in each case; what consultation he will undertake before introducing this change; and if he will publish the results of the consultation. [53955]
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§ Ms KeebleThe local government White Paper—"Strong Local Leadership—Quality Public Services"—set out our intention to pool a proportion of housing capital receipts arising in debt free authorities to finance new housing investment in areas where it is most needed. The change will put the treatment of housing capital receipts in debt free authorities on an equal footing with their treatment in other authorities. It also removes a real disincentive to authorities to take up the new borrowing freedoms planned as part of the simplification of the local authority capital finance system described in the White Paper.
The change will be introduced alongside the wider changes to the local authority capital finance system which require primary legislation; the timing of this is still to be decided. The detailed arrangements for pooling, including the proportion of receipts to he pooled, and the allocation of resources from the pool are currently being considered. The new arrangements will not apply to receipts already realised. We will be consulting on detailed proposals and will report on the outcome of the consultation.
The number of authorities that will be affected by the change will depend on what happens to debt levels and on housing stock transfers between now and the introduction of the pooling arrangement. A list of the authorities that were debt free at 1 April 2001 was given in reply to the hon. Member for Tewkesbury (Mr. Robertson) on 9 April 2001, Official Report, columns 330–32W. Housing capital receipts are mainly generated from the sale of dwellings and around 30 of these authorities own council housing. The amount of additional resources for allocation from the pool to fund new housing investment will depend on the proportion of receipts to be pooled and future levels or receipts for debt free authorities.