Right to Buy extension sharply criticised by MPs

The government's controversial plan to extend the Right to Buy to Housing Association tenants has been sharply criticised by a group of MPs.

A report from the Public Accounts Committee (PAC) has questioned how the policy will be funded, and whether proper replacement homes will be built.

The MPs also said there was evidence that Right to Buy could increase overcrowding for those in housing need.

The government said it made no apology for encouraging home ownership.

The idea of the scheme is to allow Housing Association tenants to buy their own homes, with discounts similar to those currently enjoyed by council tenants.

Members of the Committee said there was also a danger that increased discounts for Housing Association tenants would lead to greater fraud.

'Cost more'

Meg Hillier, chair of the PAC, said the approach to paying for the policy was entirely speculative.

"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 policy has previously been criticised by the Local Government Association, and the Institute for Fiscal Studies (IFS).

It has also been rejected by the governments of Wales and Scotland.

The government has said that the extension of Right to Buy - which is already being piloted in five areas of England - will be funded by councils selling off their most valuable council houses.

It promised that all the homes would be replaced.

But the MPs concluded that the government's commitment "will not ensure that these will be like-for-like replacements".

They said new homes "can be a different size and in a different area, and may cost more to rent".

How will the extension of Right to Buy work?

• Potential buyers must have been Housing Association (HA) tenants for at least three years

• Half a million HA tenants are already eligible

• A further 800,000 will become eligible later this year

• Discounts will be up to £103,900 in London, and £77,900 elsewhere

Further details available here

In their report, the MPs also said it would be difficult to replace homes on a one-for-one basis. They said such a target would require a five-fold acceleration in housing starts.

As a result, the policy could "lead to those in need of social housing suffering greater overcrowding."

But the government insisted that all the replacement homes would be built.

"This government makes no apology for helping people into homeownership," said a spokesperson for the Department of Communities and Local Government (DCLG).

"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."

The scheme is due to be rolled out across England later this year.