Government’s new approach needs more clarity

Having received the formal contract from the HCA outlining what the JV North consortium needs to deliver by 2021 in the Shared Ownership Affordable Homes Programme, our next challenge is already underway.

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While the challenge of investing a third of a billion pounds (£87.3m comes from the HCA) to deliver nearly 3,000 homes is a big one, we are keen to get started and take confidence from our record of building a home a day over the past decade under various Housing Corporation and HCA schemes.

The grant is welcome, so too is the Government’s new stance that acknowledges home ownership is not the only answer; ministers and officers have clearly listened to the sector and that is very encouraging.

The extent of the challenge facing the country was reaffirmed in the ‘housing in crisis’ rallying call delivered in the White Paper.

Even though it’s disappointing such a statement is necessary in 2017, it was helpful in making the wider public fully aware of the extent of the problems.

Yet this is only part of the challenge.

While we have grant and now acknowledgment that flexible tenures are vital, conversely more uncertainty has been introduced around rent settlement.

The 1% rent decrease sent shockwaves through the sector leading to the delay and shrinking of building, business plans being ripped up and large scale redundancies made to ensure landlords remain viable.

Given the Government estimates this four-year cut imposed in 2016 will hit associations’ rent income by £1.6bn come 2020/21, the need for assurance is ever more important.

Together with the complete lack of clarity around the Local Housing Allowance cap means that for many RPs they will not be in a position to deliver what many consider to be the most needed properties: safe, warm, comfortable, appropriate accommodation for the elderly.

Experience demonstrates that in order to be successful extra care schemes need to be of a sufficient size to achieve the required economies of scale.

Projects of this magnitude, with such uncertainty around, will simply not be delivered and that creates a huge problem for an ageing population, local authority social services, the housing sector and of course the Treasury.

We welcome the new listening tone but urge Government to take this one step further and provide additional clarity in these two fundamental areas so housing associations can make informed decisions and long-term investments.

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