Building could be grounded by Homes and Communities Agency’s failure to issue contracts
Landlords fear delays over affordable rents
Social landlords fear the government’s £1.8 billion affordable rent programme will be delayed because contracts have not yet been issued.
The first contracts for the four-year scheme were due to be signed by housing providers in July, according to the Homes and Communities Agency’s framework document - but they have not yet been sent out.
Housing associations bidding for the scheme told Inside Housing they were concerned the HCA might send contracts out and still expect them to be turned around by the end of July.
Keith Exford, chief executive of Affinity Sutton, said: ‘Boards won’t have time to receive and consider advice on it [the contract].’
Other housing providers are concerned that the fact they have not received the contract will lead to a delay in the start of the affordable rent development programme, which has received bids totalling £3.6 billion.
Under the programme, social landlords will provide most of their homes at an ‘affordable rent’ at up to 80 per cent of market rates, and raise rents on a proportion of their re-lets to the same levels.
Dick Mortimer, development director at Family Mosaic, said the 45,000-home association could be forced to wait until its September board meeting before starting work on its programme to build 3,844 homes, unless it reaches an agreement with the HCA by the time the board meets on 18 July.
Dale Meredith, development director at Southern Housing Group added that there could be a hiatus in development in the final year of the programme if the HCA sticks to its plan of not making grant payments after 31 March 2015.
He said: ‘Anybody thinking of completing a building in the second half of 2014/15 will be very worried about whether to start, because if something went wrong it would find itself with no grant.’
A select group of housing associations has seen a draft version of the contract and is talking to the HCA about it.
Some housing associations are unconcerned about the timetable for signing contracts.
Paul Tennant, chief executive of Orbit, said: ‘As I understand it there is ongoing dialogue with how the contract is shaped and signed.
A spokesperson for the HCA said: ‘We have not set a specific date by which contracts need to be signed.’
An HCA board meeting to sign off the national programme will go ahead this week as originally expected.