Autumn Budget and Spending Review submission 2024

Mission: Kickstart growth - how housing associations can help deliver 1.5m new homes

Building social homes is both the key to ending the housing crisis and kickstarting growth. Research from Shelter and the National Housing Federation, carried out by CEBR, shows that building 90,000 social rented homes would result in economic net benefits worth £51.2bn.

Due to current significant financial and regulatory pressure and uncertainty, many housing associations are reducing their development programmes and their expenditure on Section 106 homes.

To turn this around, we are asking for:

• A 10-year rent settlement with annual increases capped at CPI+1% and a fair and consistent approach to rent convergence for those homes below formula rent is needed to rebuild housing association capacity. NHF analysis shows this is on average affordable for social housing tenants. Adjustments to the welfare system should also be made to provide appropriate protections for both existing and future social housing tenants.
• A rapid boost to the Affordable Homes Programme, extending the current programme by one year, with a funding boost, a shift towards social rent, and greater flexibilities around grant rates and regeneration.
• A new long-term Affordable Homes Programme from 2026 for social rent and shared ownership, with minimum funding of £4.6bn per year on average for the first Parliament, on a minimum five-year rolling basis.
• Changes to the scope of the Economic Crime Levy for housing associations.

Mission: Break down barriers to opportunity through safe and decent homes

Housing associations are committed to providing safe, high-quality homes that are fit for the future. But the scale of necessary investment, on average £40,000-50,000 per home, is too substantial for housing associations to meet alone.

With a partnership approach between our sector and the government, we can ensure residents’ safety more quickly, meet these investment challenges and further unlock new development and regeneration capacity.

We ask that the government:

• Provide equal access to the Building Safety Fund and Cladding Safety Scheme to social landlords.
• Underwrite buildings insurance risk for buildings with safety defects.
• Remove VAT from building safety works, extend and expand the relief on Energy Saving Materials and review VAT for all refurbishment works.
• Ensure that the funding commitment to support people to evacuate residential buildings in an emergency supports the most vulnerable.
• Review and prioritise the timeframe for introducing additional regulatory requirements.
• Work with our sector to develop building safety, decency and decarbonisation funding into a new long-term £2bn per year Social Housing Investment Fund.

Mission: Clean energy superpower – housing associations can underpin the Warm Homes Plan

Housing associations are already at the forefront of tackling the twin challenges of the climate crisis and fuel poverty. Housing association homes are more energy efficient than any other tenure and because of our scale we have a unique ability to drive retrofit innovation and supercharge the supply chains that all other housing tenures will draw upon.

To get the Warm Homes Plan underway we recommend the government:

• Quickly roll out Wave 3 of the Social Housing Decarbonisation Fund (SHDF) with a funding boost in line with Labour’s Warm Homes Plan.
• Develop a new round of the Energy Company Obligation and review social housing’s access to it.
• Implement the recommendations of the National Infrastructure Commission’s Second National Infrastructure Assessment, to ramp up the delivery of heat pumps and heat networks alongside a social energy tariff.

Mission: Build an NHS fit for the future – housing associations’ role in rebuilding public services

Supported housing helps half a million people in the community and is a vital part of a sustainable housing, health and social care system. Supported and older persons’ housing relieves pressure on a range of public services and will be essential if we are to build an NHS fit for the future.

We recommend the government:

• Provide emergency revenue funding for housing-related support to local authorities in financial crisis, roll over support contracts for one year, and extend and uplift the Rough Sleeping Initiative and Homelessness Prevention Grant, to ensure vital homelessness and supported housing services can continue to operate.
• Commit to long-term, ring-fenced and increased funding for housing-related support which is held nationally but distributed locally and is at least £1.6bn per year to ensure the continued viability of vital supported housing provision.
• Reinstate the £300m Housing Transformation Fund, or an equivalent, to integrate health, social care and housing and deliver supported housing strategically.
• Commit to 167,000 more supported homes by 2040 and ensure the AHP and rent settlement covers the costs of achieving this.

What housing associations need from the Autumn Budget and Spending Review

Housing associations are well-positioned to be mission-delivery partners of the
government. The recommendations in our submission, taken together, would
create the conditions for housing associations to help deliver the biggest
increase in affordable housebuilding in a generation, accelerate
decarbonisation and future-proof homes, and play a critical role in supporting
public services to rebuild.

This review covers our asks and reccommendations.

Social housing Rent Policy briefing

Housing associations exist to provide safe, good quality homes that are affordable for people in housing need. The discounted rents that social housing tenants pay save them £9bn each year, compared to the amount residents would pay if they were renting in the private rented sector. This also saves the government £6bn per year in lower benefit payments.

This briefing sets out our rent policy asks in more detail.

Affordability of social rent briefing

While housing associations in England are keen to see the existing rent settlement continued, and a return to the prior policy of convergence, they are acutely aware of the ongoing impacts of the cost of living crisis on their residents and of the implications this has for continuing to fulfil their primary social mission, to provide homes that people on low incomes can afford to live in.

This paper examines the affordability implications of our proposed rent policy.