Of course ... if you ACTUALLY read the proposals .. and not the headlines ... it is only for NEW tenants - not existing tenants ...
But of course such headlines would not get all the lefties up in arms or sell papers ... now would it .. 
I realise it is for new tenants, but these will, eventually, become the majority occupants of social housing and so the problems caused by this move will still exist. Private rents will (and are already starting to) skyrocket, making that unaffordable. Private tenants are often obliged to move on every 6 months as the Assured Shorthold tenancies come to term. Albeit with better incomes than when they entered social housing, the likelihood of a mortgage is slim to nil.
These potential pitfalls need to be addressed also.
You say about private rents are beginning to and already have skyrocketed! Well unfortunately for all of us this is just the cost of living in our great nation, which many of the scroungers have yet to come to terms with and still expect the tax payers to wipe their backsides for them. Rents are high, the cost of buying your own house is high also.
With the boom in property prices in recent years, rents in general (and in particular LHA or Local housing allowance - limits set by local government for housing benefit) have fallen in real terms.
The government aren't silly. They get rid of all the social housing to social landlords and housing associations, and pretend they are being good to the people by having a 'right to buy' scheme and very low prices. When in fact it is beneficial to the government. They get rid of all the houses, then bring in a wave of legislation to increase cost and red tape for landlords and make it easier for sponger workshy tenants to work the system and take everyone for a ride (not all of them of course). The same can be said for care/rest homes! Notice how the government don't have many now and have said people in their old age should stay at home!
Then what is even worse (even after the legislation), they start a nasty smear campaign, nation wide, against private landlords, when the fact is, the government, the housing market, and the country in general need private landlords but don't want to face the inconvenient truth.
Houses are unique, in that you go to a pub and buy a pint, you pay for it there and then, but tenants seem to think it's ok to with hold rent and do whatever they want because they live there! As said the country needs private landlords, byt they don't do it for nothing, it is a business, but I'm surprised they don't pack up and say 'sod you all'.
I think social tenants should have less cans of Fosters, take aways, go to the bloody social club less, and pay full market rates for their accommodation.
2ndly, when short terms tenancies come to an end, generally on a 6 month term, they are renewed, unless the tenant is a total scumbag, but if they are not then there is no problem. Better than this than allowing a bad tenant to get more rites by letting it lapse to an assured tenancy.
If they want the security of a long term place of accommodation, they should buy their own house.