Explanatory Memorandum from the Department
of the Environment, Transport and the Regions (EST 98A)
PART II—COMMENTARY ON THE SUPPLY ESTIMATES
CLASS
VI, VOTE 1: HOUSING, CONSTRUCTION,
REGENERATION, COUNTRYSIDE
AND WILDLIFE,
ENGLAND
More details can be found in the Annual Report:
chapters 3, 4, 5 and 6 and Tables A1, A9, A11, A14, A15, B1-B23
and C3:
| Total Vote
|
|
| £000 |
|
| Final net provision 1996-97 | 7,621,723
|
| Provision sought 1998-99 | 6,685,646
|
| Change | -936,077 |
| Change (Per cent) | -12 Per cent
|
| |
| Final net provision 1997-98 | 7,285,606
|
| Provision sought 1998-99 | 6,685,646
|
| Change | -599,960 |
| Change (Per cent) | -8 Per cent
|
|
Class VI Vote 1 has been formed by the merger of the former
Class VI, Votes 1 and 2.
Programmes which were part of the previous Housing and Construction
Vote in both previous years are payments relating to the Housing
Corporation, Housing Revenue Account Subsidy, the renewal of private
sector housing, homelessness, housing management and mobility,
gypsy sites, rent and leasehold services, research and publicity.
The Estates Renewal Challenge Fund and payments to the Valuation
Office for right to buy work were added in 1997-98.
Programmes which were part of the previous Regeneration and
Countryside and Wildlife Vote in both previous years are the Single
Regeneration Budget, European Union agency payments, European
Regional Development Fund projects not funded by or in advance
of receipts, countryside and wildlife bodies and research and
publicity.
Changes in 1998-99, part from the merger, are the addition
of: Rural Transport development fund grants from what is now Class
VI, Vote 2; the New Deal for Communities; and ERDF projects not
funded by or in advance of EC receipts for transport projects.
However, there is a reduction in the SRB section following the
Urban Development Corporations being wound up on the 31 March.
No grant-in-aid is required to fund them for the subsequent non-operational
period of three months.
Individual Sections where the level of provision has changed
significantly are:
| Section B—Housing Corporation
|
|
| £000 |
|
| Final net provision 1996-97 | 1,109,802
|
| Provision sought 1998-99 | 734,660
|
| Change | -375,142 |
| Change (Per cent) | -34 Per cent
|
| |
| Final net provision 1997-98 | 789,264
|
| Provision sought 1998-99 | 734,660
|
| Change | -54,604 |
| Change (Per cent) | -7 Per cent
|
|
Annual Report 1998—Chapter 3, paragraphs 3,20-3.24; Figures
3a and 3c; Tables B1 and C3
The change of provision from 1996-97 was governed largely
by pressure on housing programmes overall in order to meet government
spending targets, as determined in 1996 PES settlement. The change
from 1997-98 relates largely to reduced demand for tax relief
grant as that is phased out.
| Section C—Housing Revenue Account (HRA) subsidy
|
|
| £000 |
|
| Final net provision 1996-97 | 679,779
|
| Provision sought 1998-99 | 589,180
|
| Change | -90,599 |
| Change (Per cent) | -13 Per cent
|
| |
| Final net provision 1997-98 | 696,840
|
| Provision sought 1998-99 | 589,180
|
| Change | -107,660 |
| Change (Per cent) | -15 Per cent
|
|
Annual Report 1998—Chapter 3, paragraphs 3.25—3.28;
figure 3d
The fall in demand is due to a variety of factors affecting
the overall claims submitted by local authorities. The main cause
is an unexpected fall in long-term interest rates.
| Section D—Other housing
|
|
| £000 |
|
| Final net provision 1996-97 | 40,806
|
| Provision sought 1998-99 | 80,371
|
| Change | +39,565 |
| Change (Per cent) | +97 Per cent
|
| |
| Final net provision 1997-98 | 43,172
|
| Provision sought 1998-99 | 80,371
|
| Change | +37,199 |
| Change (Per cent) | +86 Per cent
|
|
Annual Report—Chapter 3, paragraphs 3.18-3.19 and 3.31-3.38;
Tables 3a and 3e
1996-97 was the first year of the Estates Renewal Challenge
Fund (ERCF). The ERCF increase from last year to 1998-99 (£26.778
million) partly reflects the general development of the programme,
but also occurs as a greater proportion of the programme is paid
in post-transfer dowries to the future landlords.
Homelessness grants also contribute £5.564 million to
the increase on this Section. It reflects an extension of the
Rough Sleepers' Initiative to relieve homelessness beyond Central
London, to which it was previously limited.
| Section E—Construction
|
|
| £000 |
|
| Final net provision 1996-97 | 26,542
|
| Provision sought 1998-99 | 23,110
|
| Change | -3,432 |
| Change (Per cent) | -13 Per cent
|
| |
| Final net provision 1997-98 | 27,359
|
| Provision sought 1998-99 | 23,110
|
| Change | -4,249 |
| Change (Per cent) | -16 Per cent
|
|
Annual Report 1998—Chapter 4
The reduction almost all relates to construction research
and is due to the sale of the Building Research Establishment
which carries out the majority of projects. The sale resulted
in a change in payment method which meant that payments which
would have been made in 1998-99 were brought forward to 1997-98.
| Section G—Single Regeneration Budget grants in aid
|
|
| £000 |
|
| Final net provision 1996-97 | 523,442
|
| Provision sought 1998-99 | 435,471
|
| Change | -87,971 |
| Change (Per cent) | -17 Per cent
|
| |
| Final net provision 1997-98 | 549,690
|
| Provision sought 1998-99 | 435,471
|
| Change | -114,219 |
| Change (Per cent) | -21 Per cent
|
|
Annual Report 1998—Chapter 5, paragraphs 5.20-5.27; Figures
5a and 5h-5j; Tables B2-B19
The fall in provision from the last two years to this year
largely reflects the wind-up of the Urban Development Corporations.
This accounts for £190 million of the fall between 1996-97
and 1997-98. But this is partially offset by an increase in grant
in aid to the Urban Regeneration Agency (£57.006 million),
to the Greenwich Millennium project (£28 million) and to
the Docklands Light Railway (£33.33 million) in 1997-98;
and the reduction of £168.711 million between 1997-98 and
1998-99 which was offset in part by increases in grant in aid
to the Urban Regeneration Agency (£38.192 million), to the
Greenwich Millennium project (£7 million) and to the Docklands
Light Railway (£19.5 million).
| Section H—Other regeneration
|
|
| £000 |
|
| Final net provision 1996-97 | 8,867
|
| Provision sought 1998-99 | 20,763
|
| Change | +11,896 |
| Change (Per cent) | +134 Per cent
|
| |
| Final net provision 1997-98 | 8,362
|
| Provision sought 1998-99 | 20,763
|
| Change | +12,401 |
| Change (Per cent) | +148 Per cent
|
|
Annual Report 1998—Chapter 5, paragraphs 5.39-5.40, 5.42,
5.47-5.49; Figures 5a and 5r
The increase in 1998-99 is largely due to over £12 million
being made available for a new grant regime—the New Deal
for Communities.
Annual Report 1998-Chapter 5, paragraphs 5.28-5.34; Figures
5k-5o
The increase in provision from 1996-97 to 1998-99 reflects
an increased number of projects where it is known that EC receipts
will not be received or will only be received after expenditure
is necessary. However, the reduction in provision between 1997-98
and 1998-99 is due to additional provision being taken at Winter
Supplementary Estimates in 1997-98 to cover an unanticipated problem
in the timing of the receipts from the EC.
| Section N—HRAS (rent rebate element)
|
|
| £000 |
|
| Final net provision 1996-97 | 3,302,334
|
| Provision sought 1998-99 | 2,948,498
|
| Change | -353,836 |
| Change (Per cent) | -11 Per cent
|
| |
| Final net provision 1997-98 | 3,148,277
|
| Provision sought 1998-99 | 2,948,498
|
| Change | -199,779 |
| Change (Per cent) | -6 Per cent
|
|
Annual Report 1998—Chapter 3, paragraphs 3.25-3.28; Figures
3a and 3d
Demand for the rent rebate element of HRAS is dependent on
various economic factors, but the main factor is a greater than
expected fall in rent rebate caseloads, possibly as a result of
the upturn in the economy.
Annual Report 1998—Chapter 3, paragraphs 3.15-3.16; figure
3b
The reduction in provision in 1998-99 is due in part to a
rise in the number of claims by local authorities for mandatory
Disabled Facilities Grant later in 1997-98 (extra provision was
provided at the Spring Supplementary Estimate) though this extra
demand may be repeated in 1998-99. The defective housing grants
programme continues to be wound down and few eligible cases remain.
|
