England: PM pledges £2bn to help housing associations deliver tens of thousands of homes

Prime Minister Theresa May is to announce £2 billion in new funding to give housing associations the long-term certainty they need to deliver tens of thousands of new affordable and social homes.

As the first Prime Minister to address the National Housing Federation summit, she will pledge this morning to work in partnership with the associations to get more people on the housing ladder and make sure those who can’t afford their own place also have somewhere they’re proud to call home.

Mrs May will tell the summit in London: “You said that if you were going to take a serious role in not just managing but building the homes this country needs, you had to have the stability provided by long-term funding deals. Well, eight housing associations have already been given such deals, worth almost £600 million and paving the way for almost 15,000 new affordable homes.

“And today, I can announce that new longer-term partnerships will be opened up to the most ambitious housing associations through a ground-breaking £2 billion initiative. Under the scheme, associations will be able to apply for funding stretching as far ahead as 2028/29 – the first time any government has offered housing associations such long-term certainty.

“Doing so will give you the stability you need to get tens of thousands of affordable and social homes built where they are needed most, and make it easier for you to leverage the private finance you need to build many more.”

In return, the Prime Minister will call on housing associations to use their close ties with local communities, their expertise as property managers and their ability to ride out the business cycle “to achieve things neither private developers nor local authorities are capable of doing”. She is expected to say: “Today, I’m asking housing associations to use the tools we have given you. Not just to build more homes, though of course more homes are needed. But to take the lead in transforming the very way in which we think about and deliver housing in this country.

“Rather than simply acquiring a proportion of the properties commercial developers build, I want to see housing associations taking on and leading major developments themselves. Because creating the kind of large-scale, high-quality developments this country needs requires a special kind of leadership – leadership you are uniquely well-placed to provide.

“Given the right tools and the right support, you can act as the strategic, long-term investors in the kind of high-quality places this country needs. To put it simply, you get homes built. And I want to work with you to transform the way we do so.”

The Prime Minister will also urge housing associations to use their “unique status, rich history and social mission” to change the way tenants and society as a whole view social housing.

She will say: “For many people, a certain stigma still clings to social housing. Some residents feel marginalised and overlooked, and are ashamed to share the fact that their home belongs to a housing association or local authority.

“And on the outside, many people in society – including too many politicians – continue to look down on social housing and, by extension, the people who call it their home.

“We should never see social housing as something that need simply be ‘good enough’, nor think that the people who live in it should be grateful for their safety net and expect no better.

“Whether it is owned and managed by local authorities, TMOs or housing associations, I want to see social housing that is so good people are proud to call it their home. Our friends and neighbours who live in social housing are not second-rate citizens.”

David Orr, chief executive of the National Housing Federation, said the Prime Minister’s announcement was “extremely welcome”.

“This represents a total step change. For years, the way that money was allocated meant housing associations couldn’t be sure of long-term funding to build much-needed affordable housing,” he said.

He said that by changing the way the funding was allocated, ministers had given “long-term confidence and confirmed that we are trusted partners in solving the housing crisis, building new homes and communities”.

Responding to the planned address, CIH deputy chief executive, Gavin Smart, said: “The Prime Minister’s announcement is an important recognition of the vital role played by housing associations, and social landlords generally, in building new homes and providing people with a place to live that they can be proud to call home.

“Long-term certainty will give housing associations the confidence they need to invest. And long-term partnerships will enable more housing associations to take the lead in developing their own land and reduce their reliance on private developers, helping to boost the numbers of new homes we build as a nation.

“But, as the Prime Minister recognises in her speech, it’s crucial that government investment helps housing associations to build the right kind of homes at the right prices. In practice this means building more homes at the lowest social rents – which is often the only truly affordable option for people on lower incomes.”

Brian Cronin, group chief executive of Your Housing Group, said: “Like the government we want to change the nature and perception of the social housing sector, by creating property journeys for residents, which are more attuned to the lives they lead. Having a good quality rented home, managed by a professional dedicated landlord, can create a more flexible, less onerous tenure, at a lower cost for the tenant. Our aim is for our residents to be proud to rent. We’re investing over £50m in the next five years in our social housing offering and we’re committed to improving the professional landlord service we provide.”