Responding to COVID-19: insight, support and guidance
As has been reported widely, there were a number of positive announcements for housing by Philip Hammond in his Autumn Statement speech. So, amongst the big numbers, what was in it for local authority housing? And what responses might be necessary? Firstly, the key headline:
These measures are added to existing plans:
Until we see the Housing White Paper – we’d hoped to have by now, but maybe we still will this side of Christmas - and detailed plans and prospectuses are published, the final capital investment figures available for house building is difficult to precisely pin down, especially in terms of the 'when', but Mr Hammond has said that he will "double annual capital investment in housing in this parliament" to tackle the "urgent challenge" of unaffordable housing.
In his introduction to the Autumn Statement, Mr Hammond set out the three key challenges to the economy: economic imbalance, lack of productivity and unaffordable housing.
Lack of affordable housing is now explicitly linked to low productivity. For those watching closely since 2010, this is a significant change – the Chancellor is acknowledging there are economic and business drivers for new affordable homes – rather than seeing social and affordable housing as a 'handout', part of the welfare state. Building more affordable housing is now seen as an imperative to boosting UK productivity.
This is a strong position for local authority housing and housing associations to be in - a real vote of confidence in housing providers to deliver the homes the government wants. This is a government that wants the economy to work for everyone – those on low incomes as well as those on higher incomes. Housing associations and local government are now seen as key players in helping deliver this vision.
So, whilst we saw no mention of starter homes in the speech, significant given the emphasis on home ownership of former government ministers, we did see an emphasis on flexibility of delivery for all tenures. And we also saw what seemed to be a major emphasis on local government – whether that be local authorities directly or combined authorities.
There is £1.8bn for the council-led Local Enterprise Partnerships throughout England. There is the progress on combined authorities in England. There is the allocation of resources to Greater Manchester, borrowing powers for London and the prospect of many more devolution deals.
The £2.3bn infrastructure spending explicitly aimed at facilitating new housing was also very significant in this regard. Funding bids will come through local government and will be expected to secure land to build up to 100,000 homes. Follow up announcements from the HCA suggest a strongly competitive bidding process where local authorities will need to demonstrate plans 'ready to go', meeting objectives in up-to-date housing strategies. Now is the time to get your local plan in place, agreed, costed and targeted to put yourself in the best position to get some of those essential roads built. It will be challenging in the face of overall council funding reductions which has led to many strategic housing functions being under-resourced, but there is the opportunity.
Housing associations and registered providers have the ambition and now the opportunity to bid to bring forward some large, brownfield sites to build large numbers of homes (the GLA funding settlement shows the government is particularly keen to ensure more affordable homes in the capital). To do this associations seeking partnerships with councils and combined authorities may fare particularly well. Councils will need to partner with developers and associations to maximise the use of knowledge, skills and capacity to deliver.
What of council delivery? As ever the message is… innovate. Councils have been outstanding in recent times responding to policy pressures by reducing costs, building new council housing under significant constraints, recycling right to buy receipts and setting up new companies and delivery vehicles to supplement development delivery. It has been a great story of diversification.
Here again the message is as positive as might have been expected:
There is much for the housing sector to digest in Mr Hammond’s first Autumn Statement, but the fact that housing providers are seen as key partners trusted to deliver is perhaps the most welcome news of all. For local authorities, the messages are clear: get your strategic house in order to participate in the infrastructure programme and get on with directly delivering: HRA, ALMO, company – through delivery comes the opportunity for more delivery.