What does the 2021 UK Budget announcement mean for UK housing?  

What does the 2021 UK Budget announcement mean for UK housing?  

The recent Budget announcement from Chancellor Rishi Sunak featured a number of important spending decisions relating to housing, building and infrastructure. But what does this mean for the UK social housing sector? 


Here’s a look at the key decisions affecting UK housing, along with reactions from major figures within the industry… 


Recommitment to Affordable Homes Programme 


While not a new policy, the Chancellor re-confirmed that the government will be proceeding with the latest grant funding programme to build more affordable homes in the UK. It was announced some time ago, and both Homes England and the Greater London Authority both named successful bidders as recently as September 2021.  


The Affordable Homes Programme will receive £11.5 billion, with £4 billion earmarked for London and the rest of the UK getting £7.5 billion.  


New £1.8 billion brownfield fund  


Further details on this announcement are yet to come from the newly retitled Department for Levelling Up, Housing and Communities (DLUHC), but the Government has committed at least £1.8 billion in funding for development on brownfield sites. This is understood to include £300 million for local authorities, to help them unlock and develop smaller sites.  


The funding will also cover the cost of regenerating “underused land and deliver transport links and community facilities” – to the tune of £1.5 billion.  


Decarbonising social housing 


As part of a larger package of funding for its Heat and Buildings Strategy, Mr Sunak pledged £800 million for the Social Housing Decarbonisation Fund. This is designed to help social landlords and housing associations to carry out upgrades to make their tenants’ homes more energy efficient.  


How has the housing sector reacted?  


The response to the Budget 2021 announcement has been mixed, with industry figures disappointed that the government has not committed funding to critical polices they’ve been campaigning for.


This includes more money to build new social housing, and for building safety remediation - although the Budget included a new cladding tax rate of 4% on developer profits over £25 million, to help pay for cladding remediation.  


However, there were some positive reactions to the government’s funding commitments. Geeta Nanda, the chief executive of Metropolitan Thames Valley, said: 


“We welcome the confirmation that investment in new affordable homes will be maintained and the increase in the National Living Wage will directly benefit many of our residents. Alongside the £800m commitment to support decarbonisation of social housing, it is good to see that the government has listened to our calls for action on these key issues. 


“However, today is a missed opportunity to have put in place a comprehensive solution to the building safety crisis.” 


The National Housing Federation’s Kate Henderson told Inside Housing: 


“Today’s budget is a welcome commitment of support in key areas, after a year that has seen families across the country struggling to afford the cost of living. 


“Levelling-up is a priority for housing associations, who are ready to play their part in tackling local inequalities and helping communities up and down the country to thrive.” 


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