Viewed in its entirety Leicester’s Labour-run Council fails to represent the political needs of the people of our city. However, it remains the case that the Labour leadership of the Council are not all as right-wing as Sir Keir Starmer, and some of them hold progressive views on limited issues. For example, Leicester “Labour Group” remains one of the handful of Labour Groups across the country to have signed the open letter from the “Labour Campaign for Council Housing” that calls on the leaders of their own Party, the Labour Party, to commit to ending “Right to Buy” (RTB) when in government.
The continuing existence of the regressive Right to Buy means that the number of council homes owned by Leicester City Council continues to decrease every year. Thus in 2012 it was reported that Leicester had “22,357 Council dwellings,” while the most up-to-date number is that they have just 19,000 properties (which is the equivalent of “14% of all homes in the city”).[1]
At the same time, our City Council clearly understand that the declining number of council homes means they are unable to provide enough secure and affordable accommodation to the people of Leicester. This point was discussed at a recent “Overview Select Committee” meeting (held on January 11, 2024) wherein councillors discussed a document with the fairly self-explanatory title: “Exceptional Homelessness pressures on Housing.”
This shocking Council report observed that while the number of families forced to live in temporary accommodation as of September 2021 was 64, this had massively increased to 306 families by October 2023, and to 332 families as of December 11, 2023! Obviously the cost to provide such emergency accommodation is not insubstantial, and the Council states that the forecast gross spend to provide such temporary accommodation for 2023/24 is expected to be £6.7m.
But while for many years a number of trade unionists in Leicester have been demanding that our City Council use their borrowing powers to help provide a stop-gap solution to Leicester’s dire housing crisis, the Labour Party leadership i our city have until now declined to follow such a course of action. Now however it seems they have finally seen the light, and as stated in the Council’s latest report they are now proposing “to buy 225 additional properties” at a average cost of around £200,000 per property to help deal with the huge increase in homelessness. The Council explains:
“It is calculated that the proposed 225 units of accommodation would cost in the region of £45m to acquire, to be funded from Prudential Borrowing. The annual revenue costs associated with holding these properties will be £2m per year; (£1m in 2024/25) the principal costs for the Council include the interest cost of borrowing, minimum revenue provision for the repayment of debt, operating costs for managing the properties, and maintenance. Against these costs, the Council would receive rental income from families placed in the properties, assumed at the current Local Housing Allowance Rate.”[2]
Finally, in other slightly positive housing-related news, the Leicester Mercury (February 12) published an article titled “Scores of homes to be created in abandoned Leicester street.” This story referred to the 174 units of former nurses’ accommodation on Hospital Close, near Leicester General Hospital. As I previously reported:
“These much-need housing units have remained empty since 2019 when the nursing staff occupying them were evicted by the University Hospitals of Leicester NHS Trust so their properties could (eventually) be sold on to the City Council in March 2021 for £10.5 million. The Council had initially proposed that they intended to ‘spend between £3 million and £4 million bringing the homes back into use,’ so let’s see what happens.”
It is now been reported in the Mercury that after much unnecessary waiting the Council has finally promised that it will aim to reopen the vacant properties by the end of 2024.[3] This is good news but surely it remains the case that considering the scale of the homelessness crisis facing the City Council they could and should have brought about the opening the homes will a little more haste.
[1] Council owned homes in currently generate an annual income for Leicester City Council of approximately £94 million (this is the income for 2023/24) – a figure which includes rent plus service charges. This represents an income of around £4,950 per property per year.
It follows that as the number of council properties own by the Council declines the amount of income generated by council homes likewise declines. The Council note that: “In 2022/23, 329 homes were sold under the Right to Buy scheme, this was an increase of 18 sales when compared to the previous year.” They also explain: “Council tenants have the Right to Buy their council home at a discount of up to 70% of the property value. Right to Buy sales puts pressure on the HRA because it means there is a loss of rental income from the properties sold. The HRA budget proposals for 2024/25 predicts that there will be 275 sales, which will result in a rental income loss of £1.2m.”
[2] The Council report “proposes the purchase of up to 225 properties for £45m, to be fully financed using Prudential Borrowing. There is a revenue cost of purchasing and holding properties in this way, since the income from Housing Benefit will be insufficient to cover the revenue costs (interest costs of borrowing, minimum revenue provision, and property management & maintenance costs). In 2024/25 this cost is expected to be in the region of £1m (rising to £2m in future years), but will be heavily dependent upon how quickly the properties can be purchased. It is anticipated that the 225 units will mitigate up to £4.2m of the budget pressures (presenting a net cost reduction to the Council of £3.2m in 2024/25).
“The other proposals within the report, including the leasing of 125 properties are expected to mitigate up to £2m of the budget pressures. If the government continues to pay Asylum Dispersal grant into 2024/25 then this may help to offset a further £1m.”
[3] The Leicester Mercury (February 12) notes that the “first phase of work on the estate will see 35 homes created across 23 properties” (made up of “11, two-bed, semi-detached houses… and 24, three-bed houses”. “The remaining 100 homes planned for the estate – split across 13 buildings… The buildings will be turned into 14, two-bed, wheelchair accessible flats for three people, 18, two-bed flats for four people, and 68, three-bed flats for four people in the second phase of the scheme.”
Thoughts of a Leicester Socialist 
Does the council still lease properties from the mayors daughter for social housing?