Winners and losers have started to emerge from the Communities Plan. Up the ladder goes Bradford, where a transfer of 26,000 homes can now go ahead thanks to changes in the way the ODPM dishes out subsidies (page 11). Meanwhile, down the snakes go dozens of other local authorities and housing associations that will lose a funding lifeline in just seven weeks. The ODPM is to start phasing out the local authority social housing grant (page 7).

This particular £500m pot is dished out to local authorities, who can then loan it to the housing associations to help fund new developments or other local housing services. Development cash is then paid back to them from the Housing Corporation. Debt-free councils can spend it again on non-housing projects. Councils in the red have to put the cash aside. It's an anomalous system and a Thatcher-era hangover. In effect, it rewards the haves rather than the have-nots, or the better-run as opposed to the badly run councils depending on which side of the fence you sit. The grant's end is no surprise, but what's caught the sector on the hop – causing panic – is the swiftness of its demise. Dozens of schemes are now under threat.

The ODPM argues that the scheme was a nonsense, and anyway the money was being underspent by as much as £50m a year. It is trying to reassure the sector that the £175m in the kitty to cover schemes in the pipeline will provide an adequate safety net. Unless the ODPM knows something we don't, the sums appear to defy the laws of mathematics. And with the best will in the world, the ODPM is asking a lot for councils to stake their final claim to the grant by Friday. A stay of execution would be sensible. But it looks like £197m from the old grant regime has been earmarked for the approved development programme and the Challenge Fund, so it's hard to see how the new homes in London won't be at the expense of others in Dorset.

Unless the ODPM knows something we don’t, the sums appear to defy the laws of mathematics

Source

Housing Today