Corporation fights to get its extra development cash

The Housing Corporation is fighting to get back the extra £97m promised to its approved development programme that has been snatched by the government to fund its U-turn on local authority social housing grant.

The grant was due to be phased out last month. But the sector protested that the transitional funding of £380m was insufficient, the government promised an extra £111m for 2003/04.

Now, the Office of the Deputy Prime Minister has withheld the extra £97m it pledged to the ADP in the Communities Plan while it decides how to provide the money for the grant.

Doreen Wright, head of investment at the corporation, said: "As part of the transition they [the ODPM] asked us not to allocate the £97m because they were still finalising the budget headings for LASHG, but they are not saying we won't have the money in the future.

"We are hoping to meet in the next few weeks and we will raise the issue."

Neil Griffiths, research policy leader at the National Housing Federation, said: "This money would have improved vital cash backing for new housing."

Meanwhile, the corporation has published its "league" of allocations under the approved development programme.

Although most housing associations are receiving more money in 2003/4, the order of the top associations, published in this year's Investment Bulletin, has been shaken up (see allocations table).

Peabody Trust, which came a surprising 156th in the 2002/3 ADP round, leaped to 36th place in the 2003/4 allocations. It received an extra £9,566,523.

Housing 21, which came 21st in 2002/3, fell to 107th in this year's table. It received £8,319,609 less grant than last year, although changes in the supported housing funding regime mean its total funding may not have dropped by this much.

Hyde, which moved from fourth to second in the table, got the largest Challenge Fund allocation of £24,129,936 for 2003/4.

The Housing Corporation was unavailable for comment.