Plans have been unveiled to replace the current council house finance system with a more transparent way of putting authorities in control.

Announced by housing minister John Healey, the plans are aimed at improving services for tenants, while allowing finances to be more easily managed.

Councils will be encouraged to finance their rents and revenues and will be subject to a one-off allocation of housing debt.

"The proposals I am publishing today will free councils from annual funding decisions so they can plan long term and improve the management of their homes, secure greater efficiencies and improve the quality of services to their tenants," Mr Healey commented.

According to the latest Survey of English Housing, 13 per cent of households with a mortgage reported falling into arrears or having difficulties with payment in the last 12 months.

Some household groups had 30 per cent of people facing problems with payments, including unemployed households, those with one sick or disabled member and those which had been repossessed in the past.