Charitable Property Protected from Right to Buy Scheme

An amendment to the Charities Bill has been accepted by the House of Lords which will block the government's plans to force charitable housing associations to sell off their housing to tenants.

The right to buy scheme enables council housing tenants to purchase their council home at a discount. The former council tenant is then able to dispose of the property if they wish and if it is sold after five years, to sell it at the full market value. The government has proposed to extend the right to buy scheme to housing association tenants as well. However, many housing associations have charitable status. Therefore, there are concerns that not only could the scheme prevent the charitable aims being obtained of providing housing to certain vulnerable people but the scheme could also result in a disincentive to charitable benefactors if it meant that the government could force the sale of assets which have been donated to good causes.

The amendment in the Bill states that "the Charity Commission shall ensure that independent charities are not compelled to use or dispose of their assets in a way which is inconsistent with their charitable purposes". Baroness Hayter told the House of Lords that "we do not want the right to buy to be at the expense of the charitable aims of those charities which, for example, have been donated land, money or property for a specific purpose, whether it is to help house the elderly or rural workers or to rent to low-income families or other particular categories of beneficiary."

Therefore, the Bill should not affect the continuance of the charitable housing associations' aims being obtained and consequently, benefactors and donors should not be discouraged from containing to donate.

Posted on: 25/08/2015

This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.

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