My Lords, I am grateful to the noble Lord, Lord McKenzie, for clarifying that his party supports the right of people living in council homes to buy them. This is something that we feel very strongly about. It is an important right that we want to see more people have the opportunity to exercise than has been possible over the past few years, because the reduction in discounts had rather diminished the number of houses that were being sold to people. We wanted to change that, because we believe that owning your own home is an important aspiration for people and we wanted to make sure the opportunity was widely available to as many people as possible.
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In reinvigorating right to buy we wanted to ensure that we use the moneys raised from the sale of those homes, where they were in addition to the number of homes that we would have expected to be sold under the previous scheme, to fund the construction of new homes. We feel strongly about that. I have reminded the noble Lord before that in the four years of this Government we have seen more council homes built than in the previous Government’s full 13 years in office. We are trying to ensure that we both increase those homes and at the same time provide people with these opportunities.
The noble Lord asked me specific questions about where we are with those sales and I will give him a few specifics in response. The total number of council-owned properties sold to date under the reinvigorated scheme—in other words, since this Government came to power—is almost 17,200. However, in 2012-13 nearly 2,500 households bought their homes under the preserved right to buy. Therefore that brings the combined number of sales to 19,500, which I mentioned in my opening remarks. Therefore the total so far is at 19,500, of which 2,500 is preserved right to buy.
Under the reinvigorated right to buy, local authorities are able to keep the receipts from additional sales to pay off debt and fund replacement affordable housing. Since April 2012 the sales have generated a total £1 billion gross income. About £420 million of that total has been generated from additional sales receipts. That money is being recycled directly into providing new, affordable houses for rent. It is early days, but since April 2012 just under 3,000 dwellings have been started on site or acquired through the receipts from right to buy.
An important point to make to the noble Lord is our commitment that the monies raised from the sales from the reinvigorated scheme must be realised within three years from point of sale. Therefore there is a lag. We did not commit at the time that the point of construction would immediately follow point of sale: there is a three-year period. However, we are closely following that.
The noble Lord also asked about decisions on the construction of new dwellings under this scheme and where decisions lay in terms of where they would be placed. Because the moneys raised from sales go back to the same local authorities responsible for selling those homes, it is for the local authorities to take decisions on the replacement homes.
The noble Lord asked me about affordable housing and affordable rent. Before I respond to his question on the definition of affordable rent, it is worth pointing out that in addition to the new homes that have been built from the receipts of sales of council housing, we have also delivered almost 200,000 affordable homes since 2010. Therefore, a combination of affordable housing and council housing is coming on stream, which is very important.
As regards the definition of affordable rent, the simple response is: up to 80% of market rent in the area. That is our definition of affordable rent. It is also worth making the point that if somebody is on housing benefit and is not able to cover the cost of their rent, having access to affordable housing rather than social housing is not in any way detrimental to them—so being placed in a home that is designated as attracting affordable rent, if somebody is in receipt of benefits, is the same as for those who are in social housing.
The noble Lord asked whether I could give estimates of the take-up in the light of these changes. The change, taken together with other right-to-buy proposals currently before Parliament, will help nearly 11,000 tenants who are expected to benefit from these changes over the next three years. He also asked about the measure in the Deregulation Bill. He is right to highlight that one of the changes we are making alongside that through this order and the other order to which I referred earlier, is to reduce the point at which somebody is eligible to purchase to three years rather than five. As no further information seems to be coming forward, I will have to write to him on his specific questions about the starting date and the 1% extra and when it kicks in—whether it is after three years or not. I think that covers most of the points that the noble Lord made.