Chancellor accepts need for greater investment in social housing stock

The government has accepted that there is a “good case” for extra
investment in social housing after a review of the sector
recommended that at least £1.2bn each year should be ploughed
into providing affordable homes.

In the Budget, chancellor Gordon Brown acknowledged that greater
affordability, more social housing, and incentives to local
authorities to build more houses would all require additional
investment.

He said the government would look at further investment in social
housing in the 2004 spending review in July.

The number of “social houses” built in the UK has fallen from
around 42,700 a year in 1994-5 to around 21,000 in 2002-3 according
to a Treasury-commissioned review of housing supply by Kate Barker,
a member of the monetary policy committee, which was published last
week.

The review recommends that the number of social and affordable
houses be increased by between 17,000 and 23,000 every year at a
cost of between £1.2bn and £1.6bn.

The Chartered Institute of Housing urged the government to
immediately adopt Barker’s upper recommendation of £1.6bn
investment to create 23,000 homes in the social housing sector each
year.

Local Government Association chairperson Jeremy Beecham said that
more cash from new housing developments should be ploughed back
into local services so that “schools, transport and local
infrastructure do not bear the burden unaided.”

The chancellor also confirmed in his budget plans to roll-out
nationally a scheme hailed as the biggest shake-up in housing
benefit history.

Under the project, which has already been piloted in nine
pathfinder areas, private tenants receive a flat rate of housing
benefit, set locally and taking account of income and family size.

Landlords and tenants will know in advance how much they will
receive and tenants, who will get the money directly, will be able
to choose to move to a cheaper property and keep the
difference.

– Barker review available from www.hm-treasury.gov.uk/