Homes Built With Government Growth Deal Funding Will Be Subject To The Right To Buy

Councils with Growth Deal funding from the government will be expected to make any affordable housing they build subject to the Right to Buy, including homes constructed through their privately owned companies. The government has previously announced £12bn of Growth Deal funding between 2015/16 and 2020/21 for Local Enterprise Partnerships to put into new housing, the creation of jobs, and other local projects. However, it has now emerged that any affordable housing built directly by councils will be subject to the Right to Buy, which has come as a shock to some senior council figures. Read more on Inside Housing.

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'Stand Off' Could Stall Ebbsfleet Garden City

Fears are growing that the Chancellor's flagship housing project, the Ebbsfleet Garden City, could stall due to a lack of investment. The scheme, which is designed to address Britain's burgeoning housing shortage in the South East, needs more than £1bn in extra funding to become a reality. Peter Jones, the chairman for the South East Local Enterprise Partnership, said that the Government and European Union have obligated £900,000 to the project which will only take care of "the basic infrastructure." An additional £1.5bn is needed from the private sector to build the 15,000 homes promised and amenities, he continued. Read more on the Daily Telegraph website.

Housing Revenue Accounts – Parliamentary Written Answer

Tim Farron: To ask the Secretary of State for Communities and Local Government what steps his Department is taking to assist local authorities in acquiring necessary skills, partnerships and capacity to utilise the increased borrowing allowed against the Housing Revenue Account (HRA). 

Kris Hopkins: This Government has made available £300 million of extra HRA borrowing to help stock-holding local authorities build new affordable homes. The first allocations of £60 million across 15 local authorities was announced on 7 July alongside a second round of bidding to ensure councils make full use of this opportunity. Each scheme was assessed individually against a range of criteria including value for money and deliverability as well as the track record of the local authority to ensure they had the technical capacity to deliver the schemes or with a partner organisation. We have also encouraged councils to work closely with their local enterprise partnership in support of local growth strategies, to increase the supply of housing locally. (Extract)

Local Growth Fund: Housing Revenue Account Borrowing Programme (2015 to 2016 And 2016 To 2017)

The housing revenue account borrowing programme makes available an additional £300 million borrowing for 10,000 new affordable homes over 2015 to 2016 and 2016 to 2017. This was announced in the 2013 Autumn Statement as part of the Local Growth Fund and is available to local authorities who have a proposal agreed by their Local Enterprise Partnership.

• The prospectus sets out the detail of how local authorities can bid for additional borrowing and sets out the process and timetable for submitting bids.
• The application form sets out information a local authority should provide when applying for the Secretary of State’s consent under Section 25 of the Local Government Act 1988.
• The frequently asked questions document has been compiled to help local authorities that are interested in bidding for additional borrowing under the housing revenue account borrowing programme.

Download the documents from the GovUK website.

Councils Slam Pooling Of New Homes Bonus

Plans to pool new homes bonus money in London have been slammed by the English capital’s councils. George Osborne’s autumn statement announced that £70 million of new homes bonus money will be pooled through the London Local Enterprise Partnership from 2015. The money will not be pooled through LEPs in other parts of the country but will go to councils. London Councils, the umbrella body representing local authorities in the capital, described the move as a £70 million cut for London boroughs. Read more on Inside Housing.

Housing: Construction – Parliamentary Written Answer

Graham Jones: To ask the Secretary of State (1) what assessment he has made of the effect on house building of his plans to transfer £400 million of New Homes Bonus funding to local enterprise partnerships;

 (2) whether the £400 million which is being transferred from local authorities' New Homes Bonus funds into local enterprise partnerships budgets will be counted as local authority budget cuts.

Kris Hopkins: The proposal for local authorities to pool a proportion of their New Homes Bonus in 2015-16 was the subject of a technical consultation carried out between July and September this year. That consultation set out our expectation that authorities would receive the New Homes Bonus they had earned, and that pooling would be local. We are currently considering the responses to the consultation and will announce a way forward in due course. Government support and investment in housing is having an effect. Housing supply is now at its highest since 2008, with 334,000 new homes built over the last three years. In the most recent quarter, housing starts are up by 33% on last year.

Funding Cuts for Local Authorities Could Lead To Fewer New Homes

Town halls might have to shelve house building and rural broadband schemes if the government goes ahead with a £400m cut to local authorities, council leaders warned today. Under government plans, the new homes bonus – where payment is given to local authorities for creating extra housing – will be diverted to local enterprise partnership areas as part of the local growth fund. LEPs are partnerships between businesses and local authorities. £400 million from the NHB will be pooled within LEP areas in 2015/16. The Local Government Association says this represents 35 per cent of the total value of the bonus, which was introduced in 2011. Read more on the LGA website.

Council 'Shocked' At Budget Hole

A county council has claimed a £133m budget hole has increased to £154m over three years, meaning more job losses and service cuts for residents.  Labour-run Nottinghamshire County Council said they had expected a £38m funding cut following George Osborne's spending review, but that had increased to £50m over two years.  It said a further £10m cut in 2016/17 will leave it with a £154m hole.  Council leader Alan Rhodes said the situation had arisen as a result of a proposal to give money the council usually receives from the government for developing new housing - the New Homes Bonus - to the Local Enterprise Partnership instead. "The proposal to transfer the New Homes Bonus to the Local Enterprise Partnership means we have less say in how it's spent.” Read more on the BBC website.

New Homes Bonus Shouldn't Be Used To Fill Local Growth Fund Shortfall

The government's spending review decision to top-slice the new homes bonus in order to provide £400m of the £2bn 2015-16 local growth fund for which Local Enterprise Partnerships (LEPs) are expected to bid has been met with dismay, suspicion and hostility from local authorities.  Funded significantly through the local authority formula grant, the new homes bonus is designed to encourage provision at a time when new home building is experiencing the lowest rates of deliverability (and the highest levels of demand) since the second world war. The £400m amounts to 35% of the total forecast new homes bonus pot for the year. The government have issued a technical consultation with a closing date of 19 September on how this decision can be put into effect. Read more on the Guardian website.

Chancellor Pledges £3 Billion for 'Affordable Housing'

Chancellor George Osborne announced his latest round of cuts during a Spending Review statement to the House of Commons on 26 June. In terms of housing, the Spending Review includes a Government commitment to a 'significant package' of capital spending on housing amounting to £3 billion - the finer details of which will be set out in a forthcoming document called 'Investing in Britain's Future'. This includes, 'certainty that social rents will increase by CPI plus 1 per cent a year from 2015-16 to 2024-25.' Mr Osborne announced the introduction of a local growth fund, to be distributed through local enterprise partnerships, which may be worth £10 billion over five years.  Read more on the HouseMark website.

Government Pledges £500m to ‘Get England Building Again’

The Government will unlock £500 million to help English developers complete “stalled housing projects” and boost the economy, ministers have announced. The Government explained that the Growing Places Fund will be made available to “help boost economic growth by getting the required infrastructure built to enable the creation of new jobs and homes". The Fund – which will be allocated in January – is expected to “put local businesses and organisations in charge”. Ministers say 38 agreed Local Enterprise Partnerships (LEPs) - led by local authorities and major businesses across economic areas – will be able to apply for the funding and then take decisions about what to prioritise locally. The Government explained councils will support these plans with their technical and financial expertise, leaving Local Enterprise Partnerships “free of red tape and better able to focus their attentions on ensuring the funds go to where they will be used most effectively”. Read more on 24dash.