Housing Corporation to abolish annual investment bidding round

The corporation's deputy chief executive for investment, Neil Hadden, is expected to use his speech at the National Housing Federation annual conference on Wednesday to outline his vision for the future for developing housing associations.

It is understood that the changes under consideration include extending funding streams over two years, effectively abolishing the annual bidding round. This would come as a direct result of the decision revealed last month (HT 15 August, page 8) to run two parallel investment programmes in 2004/05.

One would be for individual schemes under the traditional approved development programme; the second, a large-scale pilot, would be a series of partnering deals between the corporation and a limited number of registered social landlords to build a string of projects.

It had been thought that only the latter projects would receive funding over two years, but now it has emerged that the decision to move to longer-term funding could apply to traditional schemes as well.

The traditional annual scramble is to be consigned to the history books Source close to the corporation

A source close to the corporation said: "It looks as though this year's programme will be the last annual one, with bids for both streams spread over two years, as opposed to one. The traditional annual scramble is to be consigned to the history books. This is to ensure associations are in a better position to negotiate with suppliers and get better value for money. However, it will be a huge shock to the system – particularly for medium-sized or occasional developing associations, who will struggle to get schemes onto the programme.

"Associations will increasingly be driven into mergers – especially among medium-sized RSLs and transfer organisations that have business-plan commitments to tenants to meet."

The corporation was unavailable for comment.