Affordable Homes Programme receives £300m top-up

MHCLG said that as well as the £50m increase to the LAHF, approximately £30m of funding is being reallocated from previous rounds. The department said this takes the number of homes that will be delivered by the third round to more than 2,700.

Councils that submitted applications will be contacted in the following few days to inform them of the funding allocations, the government added.

MHCLG said the announcements support plans to “get Britain building and deliver the biggest increase in social and affordable housebuilding in a generation.”

The government said there are more than 123,000 households in temporary accommodation, including nearly 160,000 children, and almost 6,000 families with children are in B&B accommodation.

Angela Rayner, housing secretary and deputy prime minister, said: “For so many families, and their children, the security and safety of a home of their own remains firmly out of reach – and instead they have to live in temporary accommodation, including in B&Bs.

“This is unacceptable and is the result of the housing crisis we are facing head-on. That’s why we’re driving forward on our plans to ensure a better future for everyone who needs a safe home, building on our plans to drive up living standards and build 1.5 million homes through our Plan for Change.”

Sector reaction

Kate Henderson, chief executive of the National Housing Federation, welcomed the announcements.

“Today’s funding announcement demonstrates that the government recognises that boosting funding for new affordable homes, particularly those for social rent, is essential to meeting its ambitious housing targets and commitment to building a generation of new social homes,” she said.

“Housing associations share the government’s housing ambitions and we welcome this top-up to the Affordable Homes Programme. The funding announced today – in addition to the funding announced in the autumn – will help maintain momentum in the delivery of much-needed social and affordable housing ahead of the new Affordable Homes Programme being announced at the Spending Review.

“Housing associations are facing a number of financial challenges due to decades of funding cuts. Alongside this vital funding injection, we hope to see a package of supportive measures at the upcoming Spending Review to enable the sector to build the homes our country needs.”

Gavin Smart, chief executive of the Chartered Institute of Housing, welcomed the announcement of further funding to the AHP.

“The housing crisis is one of the biggest challenges facing the country, and we know that increasing the supply of truly affordable homes is key to tackling homelessness, easing pressure on local authorities, and driving economic growth,” he said.

“This additional investment into affordable housing is therefore very welcome and will help support the delivery of much-needed affordable homes ahead of a new Affordable Homes Programme at the forthcoming Spending Review.

“The confirmation that 50 per cent of the additional investment in the AHP will be used to support building new homes at social rent is particularly welcome as these are the most affordable and needed. Expanding the Local Housing Fund will help local authorities respond to the huge rise in the need for temporary accommodation, which has put huge pressure on council funds and made life very difficult for some of the most vulnerable.

“Going forward, we hope the government will use the next fiscal update to confirm sustained, long-term investment to meet the scale of demand and ensure everyone has access to a safe, secure and affordable home.”

Adam Hug, housing spokesperson for the Local Government Association, said it is “positive” that the government has acted on the group’s call to increase funding for the AHP and the LAHF.

He said: “We have long made the case for councils to be empowered to build more affordable, good-quality homes quickly and at scale. This announcement will boost councils’ ability to build desperately needed affordable housing for local communities.

“Councils stand ready to work with the government to increase affordable housing to help people on council housing waiting lists and record numbers stuck in temporary accommodation. 

“We urge the government to seize the opportunity of the upcoming Spending Review to ensure local government is equipped with the necessary resources to help deliver the homes communities need.”

Fiona Fletcher-Smith, chair of the G15 and chief executive of L&Q, welcomed the funding announcement, but added that “it doesn’t come close to what’s needed”.

“In London alone, delivering the 120,000 affordable homes required over the next five years will cost £54bn,” she said.

“Not-for-profit housing associations could be key partners in delivering the government’s target of 1.5 million new homes, but we are under severe financial pressure. Years of underinvestment, regulatory pressures, and economic turbulence have decimated our ability to build at scale.

“G15 members have the experience, scale and public service ethos to deliver the right homes in the right places, but without urgent action to restore our financial capacity, we simply can’t.

“A 10-year rent settlement of CPI plus one per cent, a long-term successor to the Affordable Homes Programme, equal access to the Building Safety Fund, and a new warm and decent homes fund are the bare minimum needed to get us back to building. Without this, we are managing decline – not solving the crisis.”