COMMENT: Housing situation not ideal, but it is honest

(05 November, 2015) Editorials

Southwark Council, one of the largest landlords in the country, must be frank and open about the challenges it faces.

676Southwark's cabinet member for Housing, Richard Livingstone

Southwark Council is certainly one of the biggest landlords in the country and so the issues faced by its housing department affect more of the 300,000 residents living in this borough than it would elsewhere.

That is why the man in charge of managing this vast stock of homes, Cllr Richard Livingstone, must be as frank and open as possible about the challenges he faces.

In an exclusive interview with the News this week the cabinet member for housing has been emphatic in dispelling fears that the council would embark on more wholesale demolition of estates. With the two largest estates in the borough, the Aylesbury and Heygate, being demolished and redeveloped, the housing boss has clearly stated that the bulldozers stop here. Many of the borough’s other large estates are actually undergoing major works to bring them up to scratch.

The cost of managing such a large amount of homes is enormous, especially if you are committed to bringing estates like the Four Squares and Abbeyfield in Bermondsey, as well as Caroline Gardens in Peckham, up to standard. With land values higher than ever before, the easiest option would be to sell off some of the most valuable land, to pay for those that are costing the council money to keep and improve.

But to do this at a time of the massive shortages in housing in Southwark and the capital as a whole would be disastrous. Cllr Livingstone could not be more frank in his response to this fear, saying there was not an even list of properties earmarked for demolition.

This is despite a report being commissioned by the council to get Savills to look at how much every home is worth. Although it categorised 4,000 homes as having a value of below zero, Cllr Livingstone says overall the council owns enough profitable stock to pay for investment to bring the rest “up to scratch.”

The cost of the report at £98,000 was not cheap, but for the council properly to manage the books on such a large portfolio of homes you have to be armed with all the information. If it results in no more demolitions then it will be money well spent.

The opposition parties are right to question spending on consultants and argued that the money spent on Savills report could have paid for new kitchens and bathrooms, a key manifesto pledge of this Labour administration.

But with budgets running into tens of millions of pounds, the administration will argue that £98,000 might just be proportionate to what is needed to get everything straight.  Indeed it was also refreshing to hear the cabinet member admit that the figures to fulfil the kitchen and bathroom pledge had gone askew with the Chancellor’s curb on council housing.

Cllr Livingstone said that the department was not able to foresee George Osborne’s announcement in July that council rents would go down by one percent every year for four years. It has blown a hole in the council’s spending plans, which had been based on an annual one percent rise on top of inflation. In order to recover the £62million, Cllr Livingstone admitted that the council would have to slow down the roll-out of its kitchens and bathrooms pledge to be completed by 2023, rather than 2021.

Not ideal, but even with a two year delay, it would be some achievement to fulfil this pledge, given government cutbacks.

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