Existing schemes face cuts to provide £1.5bn funding for affordable housing
The government’s £1.5 billion investment in building affordable housing is to come through cuts to existing schemes
The Communities and Local Government department has revealed funding will be taken from its growth fund, decent homes and private sector renewal programmes to finance the building scheme.
Other departments including Business, Innovation and Skills, Transport, Children, School and Families, the Home Office and Health will be expected to provide £930 million for the Building Britain’s Future pledge, which was announced by prime minister Gordon Brown last month.
The Homes and Communities Agency (HCA) has also been asked to hit an increased efficiency target of 3 per cent in operational savings and to find £183 million through ‘efficient and flexible management’ of its housing and regeneration programmes.
An additional £35 million has been allocated to the Housing Market Renewal (HMR) Pathfinder areas.
Bob Kerslake, chief executive of the HCA welcomed today’s announcement as an indication of ‘strong momentum and quick delivery through the HCA.’
On the £1.5 million funding for affordable homes Kerslake said: ‘The funding for additional homes announced recently by Government will add substantially to our existing affordable housing programme, helping local authorities to meet housing need in their areas and simultaneously helping house builders and RSLs to maintain new build activity.
‘There is a premium on new build activity and I am pleased that the sector has seen the benefit in putting an additional £1.5bn into housing delivery.
‘However, Government has had to make some difficult decisions as to where that funding should come from, based in part on the HCA’s existing wider programme. We are confident that we can find the funding needed this year from managed savings, with no need to look at spending on specific programmes.
‘Next year, as well as further managed savings, Government will need to find around £278 million from the HCA’s existing programme, which will come from two areas – Growth and a deferral of Decent Homes funding – to minimise the impact on individual local authorities, and in particular on those who have been recognised for their high performance.’