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Housing Infrastructure Fund disadvantages Northern areas

The government’s Housing Infrastructure Fund (HIF) is benefiting Southern areas at the expense of the North of England, exclusive analysis by Inside Housing has shown.

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Castlefield, Manchester (picture: Getty)
Castlefield, Manchester (picture: Getty)
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The Housing Infrastructure Fund is benefiting Southern areas at the expense of the North of England, exclusive @insidehousing analysis has shown #ukhousing

Analysis from Inside Housing has revealed that as a result of a new formula applied to the funding that channels money more towards areas of ‘high affordability’, Northern local authorities have access to a far smaller pot when compared with Southern authorities.

Inside Housing has collated information from all the authorities that have applied for money from the fund, which aims to build infrastructure to unlock the delivery of new homes, and applied the Ministry of Housing, Communities and Local Government’s (MHCLG) formula for geographical targeting.

This formula is intended to ensure that government funds go to the least affordable areas of the country. It is calculated using the Office for National Statistics’ ratio of median house prices to median workplace-based household income.

All those local authorities above the median ratio can access 80% of funds, while those below the median can only access 20%.


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Inside Housing’s analysis has applied this formula directly to the HIF forward funding pot, worth £4.6bn, dividing the 44 combined authorities which bid for money into the 61 local authorities where projects would be built.

Of these, 27 were not deemed to be under high affordability pressure and so could bid for only 20% of the pot. All 12 of the Northern local authorities that applied for funding were in this group.

The analysis also showed that those 27 bid for around £2.2bn between them but will only have access to £920m, or 42% of what they have asked for.

Meanwhile, the 34 other local authorities, which are largely Southern, have bid for around £4.1bn and have access to £3.7bn, or 90% of the funding they have requested.

The government has already awarded HIF money to 11 projects, of which one, a plan to build a link road in Carlisle for £102m, was in the North of England. Last weekend the government announced £600m of HIF allocations, all of which went to Southern areas.

Inside Housing’s work follows analysis by the lobbying group Key Cities last year which already showed that the funding formula systematically disadvantages Northern areas, with only four local authorities in the North of England included in the group considered ‘unaffordable’.

An MHCLG spokesperson said: “This year alone we’re investing over £7.2bn, an extra £1.1bn from last year, to support housebuilding right across the country.

“We want to ensure funding reaches the areas where homes are hardest to afford, so communities get the quality housing they deserve.”

Click here for more on the North-South funding divide