Milton Keynes council has branded the government's refusal of its bid for an arm's-length management organisation "absolutely incomprehensible".
The council was the only one of 14 bidding to be included in the third-round ALMO allocation process announced on Monday to be knocked back.

The successful bidders have asked for roughly £1.5bn over the next seven years (see table, right).

However, beyond 2006 – the end of the present Whitehall spending round – funding has yet to be guaranteed by the Treasury.

The Communities Plan released £700m for rounds three and four until 2006. The third-round ALMOs will receive £360m of that sum.

Housing minister Keith Hill said Liberal Democrat-controlled Milton Keynes had been excluded because it was "an unsatisfactory bid". He explained: "The council's options appraisal was not sufficient and there was no strong evidence that the tenants had been given clear information about ALMO."

A ballot of Milton Keynes tenants, in which almost one-third voted, supported the council's ALMO plans.

Council representatives are to meet officials from the Office of the Deputy Prime Minister next Friday to discuss precisely why the bid failed.

Milton Keynes scored three out of four in the housing component of its comprehensive performance assessment last year.

However, the council's overall governance performance may have persuaded the government not to back the ALMO.

Milton Keynes' overall score under the Audit Commission's CPA rating was "weak" and this week it emerged that it has underspent its major repairs allowance for last year by 26%.

The council will now have to return to the drawing board, with transfer looking like its only option for meeting the decent homes target on its 14,000 homes. It estimates that this will cost £73m.

Meanwhile, Barnet, Islington and Solihull councils have yet to have the size of their conditional allocations confirmed.

Hill said the delay was because of technical issues that would be resolved shortly.

Source

Housing Today

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