Ahead of the 2020 Budget announcement, the National Housing Federation (NHF) set out four asks of the new government to commit to investment in ending the housing crisis. So how did the government’s commitments match-up? We have summarised the NHF’s areas of focus and the government’s response:
1 – A 10-year £12.8 billion per annum Affordable Housing Programme
In response to the UK’s vast housing shortage, the NHF sought a commitment to a 10-year Affordable Homes Programme, to deliver new low-carbon, high quality homes for social rent and shared ownership.
Although not committing to a 10-year programme, the government has promised an additional £9.5bn to the Affordable Homes Programme, “allocating in total £12.2bn of grant funding in 2020/21 to support the creation of affordable homes across England” over a five-year period. This is the largest programme for over a decade, however it is only a third of the NHF’s ask. And it is not yet clear how much of this funding will be for social rent.
2 – Building Safety Fund
To ensure that everyone can feel safe in their home, the NHF requested a Building Safety Fund to ensure that all unsafe cladding can be removed from all buildings.
In response, the government have pledged a £1bn Building Safety Fund to remove all combustible cladding from residential buildings over 18m, going beyond solely the removal of ACM cladding and supporting other safety works. This adds to the £600 million already pledged. This will be welcome news to the sector, but with the extent of the cladding problem still unclear and extending to buildings over 11m not covered by the Building Safety Fund, it is likely that the Fund will only scratch the surface of the true remedial costs.
3 – Infrastructure transformation
In order to build prosperity throughout the country, the NHF asked for investment of £1bn a year to support the transformation of cities, towns and communities, renewing infrastructure, the environment, health and housing.
The government has made significant spending pledges on roads, transport and infrastructure, including housing, with a total of £640bn of capital investment being made by 2025. The infrastructure investment focuses on investment in strategic roads, but £4.2bn has been allocated for investment in local integrated transport hubs in eight city regions.
In addition to the money promised for the Affordable Homes Programme, the budget provides an additional £400m building fund for Mayoral Combined Authorities and the building of homes on brownfield sites and £1.1bn from the Housing Infrastructure fund benchmarked for building homes in areas of high demand.
The budget as a whole had the air of promising investment throughout the country, with focus on the development of improving transport links between major cities. The budget pledges for infrastructure, particularly roads and rail, may assist in unlocking land for housing and the promised Planning White Paper is likely to provide further insight into land release reforms as a result of infrastructure planning.
4 – Rough Sleeping
The NHF called for better funding for support and a joined-up response to prevent rough sleeping.
In response, the budget has pledged £65m to move rough sleepers into permanent accommodation, and £46m from the Shared Outcomes Fund to provide improved support to individuals overcoming multiple complex needs, such as homelessness, reoffending and substance misuse. The funding is set to be paid for by imposing a stamp duty surcharge of 2% for non-UK residents.
The money pledged should fund up to 6,000 places for people to live in and it was stated that the Shared Outcomes Fund will provide a step change in the approach to support services for the homeless. However, with the budget notably quiet on social care, and the need for better integration of health and social care systems to meet the complex needs of rough sleepers, the money will be a drop in the ocean.
To encourage Local Authority building, the government is cutting the interest on lending to Local Authorities to build social housing by 1%.
There was also an announcement that the benefits freeze will end with a 1.7% increase from April 2020. The national living wage is also set to increase to £10.50 by 2024, and the income before National Insurance Tax is applied is raising to £9,500.
Overall, although the budget offered much less than was requested by the NHF and other housing bodies to meet the needs of the cladding crisis, rough sleeping and delivery of affordable homes, as a whole, the focus from this government on housing and the level of investment were both unexpected and welcome.