Social housing ‘to be hit with £8bn cuts’
Social housing could see cuts of around £8 billion as part of the comprehensive spending review on Wednesday.
Reports have suggested up to 80 per cent of the funding for building new social housing could be axed.
These emerged at the Conservative Party conference earlier this month. Housing minister Grant Shapps said capital investment has not succeeded in producing the required number of affordable homes.
Some housing associations also said they have been modelling for a future with no grant funding.
The National Housing Federation said it believed ministers are planning cuts of at least 50 per cent.
It has calculated this would mean the government will only be able to fund 243 extra affordable homes across London and the south east, on top of those already planned, by March 2015.
Federation chief executive David Orr warned cuts on this scale could trigger a double dip recession, due to the importance of London and the south east to the national economy.
‘The impact of cuts of this level would lead to the building of affordable housing effectively grinding to a halt over the course of this Parliament,’ he said.
‘Such a slump in affordable house building in London and the south east would not only be bad news for millions of people on waiting lists in the region, but it would be a hammer blow to the regional economy – which should be the powerhouse of any expected economic recovery.’
Chancellor George Osborne has insisted Britain will become stronger as a result of the cut backs.
Reports over the weekend suggested school budgets and healthcare will be protected from the worst of the £83 billion of expected cuts. Large infrastructure projects, such as Crossrail and the Merseyside Gateway, will also be spared.