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Council tenants and housing association tenants are similar in demographic and social profile - it is often a matter of chance as to which sector people end up in. Their tenancy rights, it follows, should be similar. This is largely accepted by those involved in the housing world - with the exception of the extension of the right to buy to housing association tenants. The Executive has a further ground for unifying the two types of tenancy - differences in rights can present obstacles to change, eg in stock transfer (see below). (B) Right to buy - history and background The council tenants' right to buy their own homes was one of the key and early elements of Conservative Party policy after 1979. It has been described as the biggest privatisation, yet it was also one of the quietest - not receiving the publicity that went along with the BT and gas flotations, for example. It changed dramatically the tenure profile of Scottish housing - from some 65% of people living in rented housing in the early 1980s (far higher than the equivalent English proportion at the time), Scotland now has a level of owner occupation of around 60%. It was not just the right to buy that tenants enjoyed, but the discounts that went along with it. These depended on the type of housing (higher for flats, for instance) and the length one had lived in council housing, and could be as high as 70% of the price of the property. The cost of these discounts was borne by the council as landlord, and the income from sales was counted towards the limit on their capital spending in the subsequent year. The right to buy was given to some housing association tenants in 1986, but before there had been much take-up, the 1988 Housing (Scotland) Act introduced assured tenancies, which do not include the right to buy. (C) Right to buy - Present proposals There are currently 739,000 tenancies in the social sector - 600,000 council tenants, 14,000 Scottish Homes tenants, and 125,000 housing association tenants. Some housing associations have charitable status, and it is not proposed to include their tenants in the new right to buy arrangements. Of the housing association tenants, 34% already have the right to buy (either under the 1986 arrangements or because they have 'preserved rights' following transfer of council stock); 31% are tenants of housing associations which are charities, and therefore would not acquire the right to buy under the proposed arrangements; so 34% - about 43,000 tenants - would acquire the right to buy. The proposals are described as for a 'modernised right to buy'. This will seek to: · limit the discount available during a period of 10 years after any investment by the landlord in the property · cap the discount to a maximum £30,000 (in 1998, 3% of right to buy sales involved discounts above this level) · exempt a wider range of special needs housing from the right to buy, beyond the present exemption for sheltered housing for the elderly. There will be consultation on the categories to be exempted · include a factoring scheme for repair and maintenance · ensure that Scottish Homes will arrange its development budget to take account of the right to buy take-up, especially in rural areas. 18,000 new houses will be developed over the next 3 years · ensure that the new rules do not create significant problems for housing associations in borrowing · develop the housing planning function in local authority areas. (D) Right to buy - Arguments in favour The justifications put forward by the Executive for this move are as follows: · It would be unfair to standardise tenancy arrangements by taking the right to buy away from the majority (ie, secure tenants)
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