Where have the receipts gone?

Re: "Right to buy sales could plug the decent homes gap 10 times over" (12 March, page 14). A new factor that needs to be considered is the shift in policy between the Tory governments up to 1997, and New Labour since then.

This government has allowed capital receipts to be disposed of in the year of receipt, but the Tories allowed right to buy money to accumulate as set-aside funds. Labour's 1997 general election manifesto promised the phased release of the £5bn total. But once in office, Labour released receipts in full under the capital receipts initiative for debt-free councils only (covering less than 10% of council tenants), with only very limited amounts for the rest of us.

The initiative was closed after £1.3bn had been released and civil servants at the ODPM tell me there are no plans to release the outstanding amounts.

These are still held by councils and cannot be used for non-housing purposes unless councils go debt-free – except for the very considerable interest earned, and except in the case of whole stock transfer.

The reserved right to buy funds are never mentioned in consultations with tenants, and many cynical councils have used them for expensive non-housing projects via transfers.

The sums still in reserve are huge. If 20% has been lost via whole stock transfers, then £2.5bn-3bn set aside from 1980 to 1997 is held by councils today: enough to achieve the decent homes standard and more.

Everybody interested in council housing should be calling for the release of all capital receipts for housing investment, as promised by this government when it was first elected.