A new report claims that more than a third of former London council homes sold under the Right to Buy scheme are now owned by private landlords.
The report has been published by London Assembly Member Tom Copley who wants ministers to reform the scheme, axing discounts for long-term tenants and including covenants preventing properties from being rented through the private sector.
Mr Copley also wants local authorities to retain an equity stake in properties and to be able to refuse to sell homes where they believe it would harm local housing provision.
The Labour Assembly Member’s report also suggests that councils are “frequently forced” to rent back homes purchased under RTB at higher market rates in order to house families, pushing up the cost of Housing Benefit.
Mr Copley said: “Today’s report shows for the first time that Right to Buy, a policy ostensibly about helping aspiring home owners, has led to tens-of-thousands of London’s former council homes being rented out by private landlords. This has helped to fuel the increase in the housing benefit bill, heaped more pressure on local authority waiting lists and led to more Londoners being forced into the under-regulated private rented sector.
“This shows that Right to Buy currently represents incredibly poor value for money to taxpayers. Not only did they pay to build the home in the first place, they then subsidised the considerable discounts offered to tenants and then missed out on the rental income that would have covered the build costs. Now, we have the indignity of London boroughs renting back their former council homes at higher market rent levels, once again costing taxpayers through the nose.
“This is nothing short of Whitehall-sanctioned robbery of the taxpayer.”
Andrew Boff , the Conservative London Assembly group’s housing spokesman, said Mr Copley’s proposal would “effectively dismantle Right to Buy” and unfairly targeted Londoners who “work hard and aspire to own their own home.”
He said: “Right to Buy has been enormously beneficial to millions of council tenants over the past thirty years.
“The recommendations in this report would effectively dismantle Right to Buy, because you cannot meaningfully buy or own something with so many restrictions and clauses on what you can do with it.
“By the very figures contained in this report, almost two thirds of Right to Buy properties are still owner occupied, therefore any measures that damage this successful scheme will mostly hit people who work hard and aspire to own their own home.”