Lifting the HRA cap will not solve the housing crisis alone, especially as it is only a viable solution for councils with their own housing stock.
Councils that have already transferred their social housing will continue to play an enabling role and develop new housing outside the HRA, using companies that they form within the General Fund.
When the HRA reforms took place in 2012, it was disappointing that the Treasury insisted that there were caps, a sign that they were not fully convinced by the radical self-regulation introduced that the new system of prudential borrowing introduced.
It is great that the caps are going. The scope for investment will be extended but councils’ finances are not what they were. There is a strong possibility that some councils will put breaks on projects that are perceived to carry too much risk.
Equally because the ability to borrow within the HRA requires an analysis of the headroom to do so across the council’s stock, a local authority might not embrace the disciplines that many housing associations or responsible developers exercise in ensuring that any project is viable or sustainable on its own, because their funders would not permit it otherwise.
All this points to a need not to back any one horse, but for councils to pursue a variety of approaches, including innovative joint ventures with housing associations that share a common social purpose; community-led housing that is initiated at a neighbourhood level; and, yes, public-private partnerships. Every council will have its own approach, but the optimisation of homes for all should be a shared objective.
Even with the secretary of state speculating that the new freedoms could give rise to 10,000 new homes a year, and consultants predicting even more, we will still be only scratching the surface of meeting the pent-up demand for decent affordable homes.
The key therefore will be collaboration between all those with an interest in delivering more with all the resources that can be mustered. Because the barriers that still exist, whether they be unlocking land supply, or achieving a coordinated approach to the planning process, will require resources and commitment that extend beyond those within any HRA.
Above all, this is not about method and systems, although they do go a long way to enabling delivery. This is about attitude and outlook, about being willing to integrate and to be integrated. This is about partnering, not just transacting. This is about achieving a fair economic balance in which earning enough and not striving to maximise personal gain could make a significant difference. This is about being prepared to train people on the job, adopting new ways of achieving quality build by investing in skills and technology.
Bricks and mortar, modular components and solar panels, these make a house. But a home requires a community that will live and thrive together. And that’s where the power of collaboration can be at its greatest, engaging and not just consulting, creating local forums with accountable governance to make sure that voices of the many are articulated and heard. That requires a Government that makes available the resources needed for health and wellbeing, education and employment, alongside and within the new neighbourhoods being built.
It is a great start that the Government is now proclaiming itself the champion of homes for all. This is an attitude that needs to be unwavering and convincing if the promise that is made is to be the outcome that is delivered. Councils that have the courage to work in partnership with a wide range of investors, residents and profit for purpose delivery vehicles will go much further in developing new sites. Working together is indeed the best way to deliver the homes that our communities need. Altogether, now.
Mark Cook is a partner with Anthony Collins Solicitors and a specialist in joint ventures and delivering public goods.