Salix Homes. Releasing the potential

New funding options considered for council housing in Salford

Housing

Salford City Council is to work with Salix Homes tenants to find new ways to fund improvements to council homes. The review, which will affect 8500 homes, follows recent government changes to the way council housing is financed.

The Localism Act 2011 says council housing has to be self financing, meaning the council has to borrow money to invest in housing.

This new legislation has also introduced a borrowing cap, limiting the amount councils can borrow to make housing improvements. In Salford this means it is not possible for Salix Homes to access all of the money they need to improve homes and bring them up to a decent homes standard.

The review will look at what the alternatives are for managing council housing in the city. Options include:

  • The council keeps ownership of the homes and either has them managed by Salix Homes under the current arrangements or manages them internally with the capacity to access improvement and development funds
  • The ownership of the housing stock is transferred to Salix Homes or another housing provider.

The appraisal of the options available will be led by Salix Homes tenants and the recommendations will be considered by the council later this year. If the option to transfer owners is preferred then work will be done to explain that option fully to all tenants, who ultimately will vote whether or not they agree with it.

Barbara Harper, Chair of the Salix Homes Customer Senate, said: "It is disappointing that, through no fault of the council or Salix Homes, we now have to go back to the drawing board. Significant improvements have been made to many homes and to the quality of housing services since Salix Homes was set up. However it is crucial that we find a way to safeguard the improvements already made and to find the shortfall in funding to finish the job we started in 2007."

When Salix Homes initially took over the management of the housing in central Salford and Beechfarm in 2007 they made an application to government for Decent Homes grant funding to improve council homes that aren't in the Pendleton PFI area. Whilst some funding has been provided by the government, it has not been enough to do all of the work, and more than £30m has still to be approved by the government.

Councillor Gena Merrett. Assistant Mayor for Housing and Environment at Salford City Council, said: "We've been working for some years now to improve the quality of social housing in the city and bring it up to decent homes standards. This change in legislation now makes it impossible for Salix Homes to continue with these improvements in central Salford.

"We now need to look at what alternatives there are that will help us to continue to maintain and improve the social housing available in Salford. We're just starting this process now and will be considering all available options. Tenants will be at the heart of examining the options and will of course have the final say. We need to find a solution that works for everyone and we will fully consult with all interested parties throughout the process."