Conservative plans to extend right-to-buy rules to housing associations would force charities to sell assets against their wishes, and would “set a dangerous precedent for all civil society”, the chief executive of the National Housing Federation has said.
The Conservative manifesto, published last week, promised to extend right-to-buy discounts to housing associations, forcing them to sell off properties to their tenants at less than market value.
But David Orr, chief executive of the National Housing Federation, the umbrella body for the housing association sector, said his members were independent charities and did not support the policy.
“The State should not be able to direct private independent organisations, including community benefit societies and registered charities, to sell their resources at less than market value to support a policy they feel is contrary to their core objectives,” he said.
He questioned whether the plans were legal under current charity law, and said the move was a fundamental revision of the relationship between the State and civil society, which does not allow the State to direct the sale of charity assets to non-charitable third parties.
“It would set an extremely dangerous precedent for all civil society,” he said. “If they can do it to housing associations there’s no reason why they couldn’t do it to Cancer Research UK, or Oxfam, or any other charity. It’s fundamentally wrong for the state to behave in this way.
“If a Conservative administration attempts to implement this policy we will fight them every step of the way.”
Housing associations are providers of social housing and are mostly community benefit societies – a type of exempt charity – but some are registered with the Charity Commission. They are independent from government, although they have their own regulator, the Homes and Communities Agency.
Housing associations exist to provide social housing, often by borrowing against the value of existing housing stock to build new homes. The Conservatives have said the cost of right-to-buy would be compensated for by selling off council assets to provide the money to build new homes. However housing associations have questioned whether they would receive sufficient funding to allow their business model to continue.
“In our public commentary about the proposed extension of the right to buy, we have focused on how unfair it is, how it answers the wrong questions, and how it fails to address the root causes of the housing problems in the UK,” Orr said. “But beyond all of those there’s a much more fundamental question and that’s about the nature of the relationship between the State and civil society.
“Housing associations are independent charities which hold assets in trust for their community. There is a State regulator to ensure those assets are spent properly, but that is the limit of State involvement. They cannot appoint board members.
“It’s fundamental to the way civil society works that responsibility for looking after the organisations’ assets rests fairly and squarely with the board, and it would be deeply dangerous if the state was allowed to intrude in that relationship.”
Charity lawyers said it was unclear whether the Conservatives’ proposals were legal under existing charity law, and also questioned whether they contravened Article One of the Human Rights Act – the right to property.
An NCVO spokesman said the rules were likely to “constitute significant government interference in the running of independent charities” and that it would be watching the proposals closely.
