Land Use & Development
Financial Viability of the Social Housing Sector: Introducing the Affordable Homes Programme: Department for Communities and Local Government
HC 465, Report by the Comptroller and Auditor General, Session 2012-13
- National Audit Office (NAO)
- TSO (The Stationery Office)
'Financial Viability of the Social Housing Sector: Introducing the Affordable Homes Programme: Department for Communities and Local Government (HC 465)' examines the Affordable Homes Programme which is aimed at delivering housing below the market price.
The development of the new funding model for affordable rent and home ownership was led by the Department for Communities and Local Government and the Homes and Communities Agency. The new Programme will be delivered by housing associations, local authorities and other housing providers, who were able to bid for Programme funding during 2011.
The new model means the Department pays less grant per home than under previous schemes (£20,000 compared with £60,000 under the previous programme), while housing providers borrow more and can charge higher rents.
The new scheme represents a reduction of 60% in the average annual spending on affordable homes over the four years of the Programme: from 2011-12 to 2014-15, compared to the three years up to March 2011. The Programme will increase the providers' financial exposure, with the sector facing challenges in securing bank financing for capital investment and the cost of supporting both future and existing debt. Providers have committed themselves to building some 80,000 homes for the £1.8 billion of Government investment, compared to the initial target of 56,000.
Key risks of the Programme remain:
nearly a fifth of contracts with housing providers remain to be signed;
more than half of the planned homes are not currently due to be delivered until the final year of the Programme; and
some providers are concerned that they may not be able to charge rents at the levels they originally agreed.
|Format||Paperback||Published||04 Jul 2012|
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