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At a glance: the key Budget 2021 announcements for UK housing

Rishi Sunak gave his latest Budget speech, alongside a departmental Spending Review. But what were the important policies for the UK’s social housing sector? Peter Apps summarises the key lines

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Chancellor Rishi Sunak delivered his Budget and a Spending Review today (picture: Alamy)
Chancellor Rishi Sunak delivered his Budget and a Spending Review today (picture: Alamy)
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Rishi Sunak gave his latest Budget speech, alongside a departmental Spending Review. But what were the important policies for #UKhousing? Peter Apps summarises the key lines

  • A £1.8bn brownfield fund: The closest thing to new money for housing in the Budget was the brownfield fund, which was trailed in the press over the weekend. Background documents said the money will include £300m to combined and local authorities to “unlock” smaller sites, alongside £1.5bn to provide funding “to regenerate underused land and deliver transport links and community facilities”. Expect further details from the Department for Levelling Up, Housing and Communities (DLUHC) in due course.

 

  • A cut to the Universal Credit taper rate: As trailed in The Sun this morning, Mr Sunak’s final announcement was an 8% cut to the rate at which benefits taper off as claimants earn money from work. The precise mechanics of this are complex but in essence, Universal Credit will be cut by 55p rather than having 63p in every £1 over the work allowance. This means low-income families in work will keep more of their benefits and the change will be introduced “within weeks”.

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  • Money for homelessness and rough sleeping: The government will spend £640m on projects to reduce homelessness and rough sleeping – which Mr Sunak carefully presented as an 85% increase on 2019 but appears to be a reduction on last year (when funds were boosted as a result of the pandemic). This money will be for projects such as the Rough Sleeping Initiative, which invests in “locally led, tailored interventions to move rough sleepers into secure accommodation” as well as the delivery of 6,000 homes under the Rough Sleeping Accommodation Programme and other projects.

 

  • Cladding tax rate to be set at 4%: The government announced plans for a tax on developers to help pay for cladding remediation in February and today Mr Sunak confirmed the rate: 4% on profits over £25m. This helps pay for the £5bn Building Safety Fund – but there was no new money announced and no further announcement on the promise of loans for residents in medium-rise blocks.
  • ‘Reconfirming’ an £11.5bn Affordable Homes Programme: Mr Sunak referred to the latest programme of grant funding – which has been long announced and is under way, with £4bn available in London and £7.5bn for the rest of England. This programme saw successful bidders so far named by the Greater London Authority and Homes England in September.

 

  • Heat pumps and energy efficiency measures: The Budget documents contain details of plans announced earlier this month to spend £450m on heat pumps and £800m on the Social Housing Decarbonisation Fund, among other measures.

 

  • What was missing? Policies that housing bodies have called for that were not delivered included boosts to Local Housing Allowance rates, additional funding for building safety remediation and more money to build new social housing. There had been some fears in the sector of new cuts – such as a rent cut – given the need to balance the books, but this did not come to pass. The Budget documents contain no additional announcements about the plans for further pilots of the Right to Buy extension to housing association tenants, suggesting that the policy’s long death may finally be complete.

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