Three-year package worth £3.3bn represents a fall on current levels of affordable housing funding
The government has committed £3.3bn to affordable housing over the three years from 2015, a marginal fall on the funding through the current programme.
Unveiling the government’s £100bn infrastructure plan today, Treasury secretary Danny Alexander committed the government to £3.3bn in funding for affordable housing for the three years from 2015-16 to 2017-18.
Alexander said this would fund 165,000 new affordable homes.
But the current affordable homes programme, which is to fund 170,000 new homes, is worth £4.5bn over four years, which averages out at £1.13bn per year.
The new package averages out at around £1.1bn per year.
Alexander also announced a new Affordable Rent to Buy scheme, with £250m available in 2015-16 and £150m in 2016-17 to support new affordable homes for rent and eventual sale.
Other housing announcements in the infrastructure plan included:
- £160m of funding in 2015-16 for Decent Homes, targeted on areas with the largest number of non-decent homes
- £102m of loan and equity finance in 2015-16 to meet upfront infrastructure requirements that will enable housing projects to proceed
- The sale of £5bn of public land and property over the next parliament, with the sale of land centralised in the Homes and Communities Agency
National Housing Federation chief executive David Orr said the £3.3bn for affordable housing over three years was in fact a cut in subsidy.
He said: “The government has recognised that public investment is required if we are to build more of the affordable homes which are so desperately needed by the millions of people struggling to afford a home of their own.
“But the £3bn over three years announced today is in reality a further disappointing cut in subsidy and won’t deliver the ambitious house building programme we need. The lack of investment in housing is now acting as a brake to growth in other parts of the economy.
“We welcome the plans to sell-off £5bn-worth of publicly owned land which could be used potentially for housing and look forward to hearing more as to how this will be distributed.
“The Government’s confirmation that rents will rise by CPI +1% for 10 years is welcome, but we need to discuss the fine detail of how this will operate in practice if it is to enable housing associations to plan with confidence.”