Confirmed: there will be more ALMOs and PFIs

The ODPM has confirmed it is to launch a fifth round of arm's-length management organisations and a fourth round of the housing private finance initiative by April 2005.

It had previously refused to say whether funding would be available for ALMOs and PFI on top of the £2bn and £1.4bn that was respectively allocated in the 2002 comprehensive spending review.

The news will be a relief to councils that had banked on a fifth round of ALMOs to fund efforts to meet the decent homes standard.

But they will have to wait until the review on Monday to find out how much money has been reserved for the new rounds.

Joanne Roney, housing director of Sheffield council, said: "A fifth round was an integral part of our strategy and we'd have been in real difficulty without it. We're hugely relieved."

Sheffield's policy of splitting the city into 10 neighbourhood commissions to decide on decent homes strategy relies on further ALMO rounds for the areas yet to decide a course of action. Transfer is seen as a political impossibility except on single estates.

The announcement is also a fillip to the ALMO movement in general, which has been battered by the rejection of its calls for greater borrowing powers (HT 7 May, page 7).

Gwyneth Taylor, policy officer for the National Federation of ALMOs, said: "It's excellent news. We've met all the government requirements in terms of decent homes, with many ALMOs on course to deliver early, and we're demonstrating improved service delivery and tenant participation.

"We believe the government has heard our case."

NFA chair Mike Owen added: "How much funding is the question. We're waiting for the spending review."

The news was contained in the ODPM's 2004/5 business plan, published last Friday. It lists a "further round of the PFI, ALMO and housing transfer" as one of the department's "key work streams" for the year.

An ODPM spokesman later confirmed that this referred to a fourth round of the PFI and a fifth round of ALMOs. In a joint submission to the spending review the National Housing Federation, the Chartered Institute of Housing and the Local Government Association called for £1.5bn to be allocated to two further rounds of ALMOs. But it said investments in PFI should be put on hold.

The new PFI round comes despite continuing concerns over the amount of time existing schemes have taken. Only seven of them, the first starting in 2000, have so far been signed.

Andrew Charlesworth, general manager of PFI investor Regenta, said adequate ODPM funds were vital: "We're hoping the government can provide greater support than on previous rounds."