A week after the government revealed what will be cut to pay for its pledge of £1.5bn extra for new homes the shock waves are still being felt around the housing world.
As Inside Housing reports today, the losers include ‘stunned’ almos facing cuts in decent homes funding, growth areas who say losing funding amounts to ‘robbing Peter to pay Paul’ and a squeeze on parts of the the Homes and Communities Agency’s budget.
Yesterday, the cuts were the subject of a rare Times leader on social housing. Today London Councils has written to housing minister John Healey warning that 80,000 homes in the capital could miss out on vital improvements.
In that context it’s easy to forget that £930m out of the £1.5bn is actually coming from cuts in other departments rather than cuts in housing programmes - a rare acknowledgment of housing’s importance in the general scheme of things.
It probably feels worse because, with a few exceptions, this is pretty much the first time in ten years that housing budgets have been cut. Labour took power in 1997 committed to sticking with Conservative spending plans that involved deep cuts in the new homes budget but bolstering investment in the existing stock by releasing accumulated capital receipts.
But it’s just a taste of what lies ahead in what the Institute for Fiscal Studies says could be eight years of pain for the public sector. With both parties pledged to stick to spending plans on health, schools and overseas aid, it says spending on other services will have to fall by 16.3% over the next spending review period between 2011 and 2014.
Cuts like that could take housing into new territory that not even those old enough to remember the early 1980s have experienced before.
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