POLITICS

General Election Right To Buy Pledge Would Face Legal Challenge, Housing Association Warns

15/04/2015 13:14 BST | Updated 16/04/2015 14:59 BST

The Tories' headache over extending 'right to buy' worsened as a housing association warned it would take legal action if it were forced to sell its houses to tenants at below market rates.

Cameron announced the Tories would extend the scheme to housing association tenants if they win the general election, but the policy was promptly condemned as "comprehensively the wrong solution" to the housing crisis by National Housing Federation chief executive David Orr, in a blog for HuffPost UK.

The extension would mean roughly 1.3 million people living in housing association homes could buy them at a discount.

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Cameron has made the right to buy pledge the centrepiece of the Tories' manifesto

Tony Stacey, who represents hundreds of housing associations and is chief executive of the South Yorkshire Housing Association, said the issue was "fundamentally critical".

“I would definitely challenge it legally. This is so fundamentally critical to us. It would shoot up to the top of our risk map if it was confirmed. We are duty bound morally to fight it in any way we possibly can,” he told trade publication Inside Housing.

Housing associations are not part of the public sector but not-for-profit private ventures. This has raised questions about the legality of them being made to sell off homes they own for less than their value.

The Independent quoted "industry sources" saying the law would have to amended because charities, including housing associations, cannot sell off their assets for less than market value.

Forcing the sale could breach the European Convention on Human Rights which says people should have the “right to the peaceful enjoyment of one’s possessions”.

The Tories' pledge has been described as the centrepiece of their manifesto.

Critics have said it would cut the number of homes available to renters at a time when the country desperately needs more homes to bring increasing rents and house prices under control.

In his blog, Orr wrote: "To end the crisis we need to build new homes and regenerate those not up to standard. Any money we have should go to that task. The Conservative proposal will mean the transfer of huge sums of money to private individuals who are already some of the best and most cheaply housed people in the country."

Gavin Smart, deputy chief executive of the Chartered Institute of Housing charity, said extending Right to Buy will not tackle the "housing crisis".

He added: "In fact it could make things worse for people on lower incomes who are already struggling to access a decent home at a price they can afford.

"Individual tenants might benefit from the opportunity to own a home, but we would be very concerned that it would result in a dramatic loss of vital social and affordable housing."

"It could have a huge impact on councils' ability to build new homes, particularly in more expensive areas like London and the South East, where it might actually make more sense for them to borrow against the value of these properties so they can fund more homes."

He added: "The Conservatives say each home sold under the extended right to buy would be replaced on a one-for-one basis - but we know this is not happening under the current scheme.

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"Our research has shown that most authorities only expect to be able to replace half or fewer of the homes they sell under right to buy. And government figures show that between April 2012 and last September councils started or acquired 2,298 homes using Right to Buy receipts - just one for every 11 sold."

"The next government should be reviewing the way the policy currently works, not extending it," he added.

But Mark Littlewood, director-general of think-tank the Institute of Economic Affairs, said he was "staunchly for" the approach.

He said: "All of the evidence suggests that, when you transfer the housing stock away from state ownership and into the hands of individual citizens, they feel a greater stake in society.

"Crucially, improvements start to be made to the property. I live in a former state-owned property which was sold off under Margaret Thatcher and the improvements to the block of flats have been enormous."

This month, the theme of 'Tenant Nation' is part of HuffPost UK's Beyond The Ballot series, looking at topics which are failing to penetrate the national debate. We're asking how we can defuse Britain's housing ticking time bomb, specifically for the millions living in private rented accommodation.

As part of The Huffington Post UK's Beyond The Ballot series we want to know what issues you think aren't getting enough attention in the election campaign. Tweet using the hashtag #BeyondTheBallot to tell us in 140 characters and we'll feature the best contributions

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