星空传媒

Councils could soon be given the ability to borrow against rental income, a senior civil servant has suggested, repeating earlier claims made by DTLR secretary Stephen Byers (pictured).

And the power could be granted within the next few months.

Mike Wilkinson, joint head of the DTLR鈥檚 local authority finance division, hinted at the change last week.

Addressing a London conference on arm鈥檚-length management, he also admitted that more than 200,000 homes were set to miss the government鈥檚 target for meeting decency standards by 2010.

Wilkinson said that councils with the poorest housing stock could lag behind on the decency standard, and referred to them as 鈥渢he intractable ones鈥�.

It is believed that the plan to extend councils鈥� borrowing powers is, at least partially, a reaction to Birmingham tenants鈥檙ejection of transfer earlier this month (Housing Today, 11 April).

Housing experts have repeatedly claimed that an extensive transfer programme was necessary in order to meet the decency target for council housing.

The Birmingham 鈥榥o鈥� vote, however, has damaged confidence in 鈥榤ega鈥� urban transfers.

Wilkinson also suggested that councils could be permitted to borrow against their future revenue streams as part of this summer鈥檚 comprehensive spending review.

鈥淩ent restructuring is going to increase rental income for some local authorities. 鈥淭here would be a certain satisfaction in using locally generated money to fund local projects and improvements,鈥� Wilkinson explained.

News of what Wilkinson calls a 鈥渂ack of the envelope calculation鈥� came as the government tried to pick itself up after the rejection of England鈥檚 largest transfer.

鈥淭he vote in Birmingham is causing some rethinking 鈥� it came as quite a surprise.

鈥淲ill this now mean that the transfer agenda forecasts are a bit optimistic?鈥� Wilkinson asked.

Speaking at the same event, Ian Doolittle, a partner at law firm Trowers & Hamlins, proposed an in-house management body as 鈥渁n alternative, or possibly a precursor to an arm鈥檚-length management organistion鈥� for local authorities.

Wilkinson pointed out, however, that funding was not currently available for such a model.

Under pressure from delegates, Wilkinson refused to back down over the DTLR鈥檚 requirement for a three-star inspection rating in order to qualify for full access to arm鈥檚-length funding.

He said: 鈥淚f the money fails to be spent, then the department is going to have to re-evaluate [the process].鈥� No council housing service has yet received a three-star rating from the Audit Commission.