With the right interventions at next month’s Spending Review, housing associations can help deliver change

Housing associations, whose founding social purpose makes them indispensable partners to resolve this crisis, stand ready to play their part. Our members see the transformational impact of having an affordable and secure place to call home every day.

We estimate that social housing saves residents around £18bn in lower rents each year, including £12bn of reduced welfare costs.

But our sector wants to do so much more. Following years of cuts to revenue and capital funds from 2010 – alongside the introduction of additional, unforeseen cost pressures – social landlords’ balance sheets are under severe pressure.

The safety and quality of existing homes will always be housing associations’ top priority, but delivering investment alongside building the new homes we need will require a step change in support from the government.

“This is a real opportunity for the government to kick-start economic growth, job creation and improved living standards through social housebuilding”

Housing associations understand that the government faces significant fiscal pressures, and that public services across a range of areas require urgent investment. Our members face tough choices of their own right now.

In London, where housing pressures are at their greatest, affordable housing starts fell by 90% last year because of the pressure on balance sheets and the urgent need to invest in existing homes. As our recent campaign highlighted, supported housing is on the brink of a financial crisis.

Labour’s manifesto recognised that rebuilding the financial capacity of housing associations and local authorities is necessary to enable them to increase supply. Next month’s Spending Review provides the opportunity to deliver on that ambition, laying the foundations to ramp up supply to meet the 1.5 million new homes target, including the biggest boost to social and affordable housing in a generation.

The housing strategy that accompanies it should outline a long-term, joined-up and outcomes-based blueprint to resolve the housing crisis.

This is a real opportunity for the government to kick-start economic growth, job creation and improved living standards through social housebuilding, allowing housing associations to implement the change the government has a mandate to deliver.

We have been assured by the level of detailed engagement from ministers and senior officials that they understand how all elements of the financial package are required to rebuild the capacity of social housing providers, unlocking their ability to borrow by leveraging private finance.

The National Housing Federation and housing associations have been clear about the importance of a long-term, above-inflation rent settlement. We have made a strong case for a fair and consistent return to rent convergence, which would unlock an additional £18bn in private borrowing, enabling the sector to build at least another 92,000 affordable homes over the next decade.

With ambitious grant support to unlock investment in greener, warmer homes, we can continue to invest in the quality of our existing homes. Our research shows that had our sector had equal access to government support for building safety, the £3.8bn costs of remediating unsafe buildings could have funded an additional 91,000 new affordable homes.

“With ambitious grant support to unlock investment in greener, warmer homes, we can continue to invest in the quality of our existing homes”

And investment in supported housing – a vital national resource that saves the public purse £3.5bn per year – is also essential if ministers are to deliver on their ambition to create an NHS fit for the future, halve violence against women and girls, and reduce record homelessness.

Once the sector’s financial capacity has been restored, housing associations will then be able to bid in a new, long-term and ambitious Affordable Homes Programme to build the homes we need. The recent announcement of funding for the new programme is very welcome and clearly demonstrates ministers’ commitment to the sector. It is encouraging that this was described as a “down payment” ahead of further investment at the Spending Review.

With the right interventions at the Spending Review, housing associations can act as mission-delivery partners for the government. The full package of support would enable them to build the social and affordable homes we need while continuing to invest in quality and services.

It would allow the government to deliver on the ambitions laid out in the Plan for Change agenda.

And most importantly, it would provide hope for those bearing the brunt of the harshest effects of the housing crisis, including the 165,000 children in temporary accommodation, who will otherwise continue to be let down by a failing system.

Kate Henderson, chief executive, National Housing Federation