Taxpayers and military families will benefit from a deal to bring
more than 36,000 military houses back into public ownership,
which has formally completed today.
Contracts were exchanged between MOD and Annington in December
and today's formal completion sees taxpayers regaining ownership
of 36,347 houses. This landmark deal has ended the £600,000 daily
rental bill – totalling more than £230 million a year – and makes
major housing redevelopment and improvements
possible.
The estate is now valued at £10.1 billion when not subject to
leases and is being purchased for just under £6 billion -
providing excellent value for money to the taxpayer and
representing one of the largest value commercial housing deals in
UK history. The impact on net financial debt is confined to £1.7
billion.
The agreement frees up our ability to build on the Service Family
Accommodation estate with more modern houses, helping reduce
maintenance costs and, as part of work facilitated by the deal,
programmes to build new houses are being
accelerated.
Planning applications will be submitted in the coming days for
265 new houses and apartments at RAF Brize Norton, and further
plans will be submitted in the Spring for around 300 new houses
at Catterick Garrison.
National security is foundational to the Government's Plan for
Change. This deal will help to deliver on the Government's
milestones on kickstarting economic growth and boosting
housebuilding across the country, and on our commitment to renew
the nation's contract with those who
serve.
Defence Secretary, MP,
said:
"By reversing one of the worst Tory privatisations of the 1990s,
we have opened up a once in a generation chance to improve homes
for our armed forces and their families, who sacrifice so much to
keep us safe.
"This deal is already saving the taxpayer £600,000 a day - and
will put us back in the driving seat as we renew and rebuild
family accommodation. Our forthcoming military housing strategy
will draw on leading independent experts to capitalise on these
savings.
“This Government is unrelenting in our commitment to renew the
nation's contract with those who serve."
Work on the new military housing strategy has begun, with plans
for its publication later this year. Key principles of the
strategy will include: a generational renewal of Armed Forces
accommodation; new opportunities for forces homeownership; and
better use of MOD land to support the delivery of affordable
homes for families across Britain.
The first steps in the strategy will include the rapid
development of an action plan to deliver on the “once in a
generation” opportunities unlocked by this deal. This work will
involve independent experts, forces families and cross-government
input.
The original sale in 1996 did not strike an appropriate balance
of risk and reward, and it is estimated the taxpayer is nearly £8
billion worse off as a result. Money which should have been
better spent on maintaining and improving our service family
homes.
ENDS
Notes to Editors
Eliminating the liabilities associated with the leases creates
budgetary headroom to partially fund this purchase, meaning that
the public expenditure impact of this measure, and the impact on
net financial debt, is confined to £1.7
billion.
Taxpayers being £8 billion worse off as a result of the
deal:
- £4.3 billion spent in rent.
- 18,000 properties handed back to Annington – with an
estimated current market value of £5.2 billion.
- £1.7 billion income generated in 1996 for the taxpayer as
part of the original deal.
- Total - £7.8 billion worse off.
