The Affordable Homes Programme since 2015 – Report Summary

This is a House of Commons Committee report, with recommendations to government. The Government has two months to respond.

Author: Committee of Public Accounts

Related inquiry: The Affordable Homes Programme since 2015

Date Published: 7 December 2022

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The Department is unlikely to meet its housebuilding targets – falling short by 32,000 homes from its original 2016 and 2021 Programme targets. The 2021 Programme is struggling to meet its public target of ‘180,000 new homes should economic conditions allow’. It is currently forecasting to achieve 157,000 new homes against that target and there are considerable risks ahead, including construction inflation, of which the Department does not seem to have a grasp.

The Department estimates it will spend £20.7 billion between 2015 and 2032 to provide 363,000 new grant-funded affordable homes. Through the 2015 and 2016 Programmes, the Department forecasts that 206,000 new grant-funded homes will be built. There is a clear demand for more social homes for rent, a tenure which is the only real affordable option for many people. Homes for social rent provide the highest value for money, but it is a ministerial decision that half of homes to be built under the 2021 Programme are for ownership rather than rental. And yet the Department has not calculated potential savings from reducing the number of people in temporary accommodation which is costly to the taxpayer.

As well as the total of homes the Department has sub targets for different categories of housing which it is also struggling to meet. For the 2021 Programme, the Department is set to miss its targets to deliver 10% of homes in rural areas and may struggle to deliver 10% of homes as supported homes (where support, supervision or care is provided alongside).

The Department does not focus support to local authorities with the highest housing needs. It specifies an overall target for new homes that local authorities should see built in their area but does not use the Programme to help individual councils meet these targets. Local authorities lack strong powers to shape development in their local areas as they face penalties if they do not approve enough development proposals put forward by housing providers to meet their overall targets.

The Department has also not quantified potential savings by providing homes that could reduce local authorities’ spending on adult social care. On net-zero, the Department’s thinking was not advanced when it set up the 2021 Programme. It did not set any standards for homes to be net-zero, which may lead to expensive retrofitting occurring in the future. The Department fails to publish transparent data on where homes are built by local authority, or information about the type or size of homes, making it difficult to hold the Department to account.