The Department for Communities and Local Government’s plan to extend the Right to Buy scheme to housing association tenants has been roundly criticised by a group of MPs.
The Public Accounts Committee (PAC) expressed concern about whether proper replacement homes would be built and cast doubt on the viability of the funding for the programme.
In its report, MPs also warned there is a danger that rising discounts for tenants could lead to greater fraud.
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Committee chair Meg Hillier said: “The approach to paying for this policy seems to be entirely speculative.
“On the basis of evidence heard by our committee, there are no costings or workings out. We are not talking about a ‘back of an envelope’ calculation - there is no envelope at all.
“The Department has not made a diligent and credible case for this policy.
“We urge the government to address the very serious concerns highlighted by our committee as a priority.”
The government plans to fund the extension of Right to Buy through councils selling off their most valuable council houses.
Ministers have also pledged that all the homes would be replaced.
But the PAC claimed that the government’s commitment “will not ensure that these will be like-for-like replacements”, arguing that new homes “can be a different size and in a different area, and may cost more to rent”.
“Where new homes are built in different areas, or are let at higher rents or sold as Starter Homes, the Department’s policy of extending the Right to Buy could mean a long-term reduction in homes for social rent in some areas,” the MPs warned.
The committee said that to achieve a one-for-one replacement of homes would require a five-fold acceleration in housing starts.
Due to this, the policy could “lead to those in need of social housing suffering greater overcrowding,” they added.
The MPs called for a full analysis of how the policy would be funded and for ministers to “provide a clear statement of where financial and other risks lie, and spell out its contingency plan if its policies prove not to be fiscally neutral”.
A DCLG spokesperson said: “This government makes no apology for helping people into homeownership.
“Our voluntary agreement with housing associations will mean 1.3 million tenants will have the chance to own their own home, while every home sold will be replaced with a new affordable property.”