Welsh draft Budget allocates £81m in extra capital funding for social rent homes

The “primary focus” for the housing and local government portfolio will be on social homes, the Welsh government said, as it strives to meet its the target of delivering 20,000 homes for social rent during the current Senedd term.

Earlier this week, it announced an extra £10m for social housing for 2024-25 in a bid to reach this goal.

An extra £57m in financial transactions capital is set to be provided in 2025-26 for the Help to Buy scheme, while retrofit will receive £3m. A further £2m of capital funding will be allocated to Leasing Scheme Wales, a programme that allows property owners to lease homes to their local councils.

The independent living programme, a scheme to fund housing adaptations, will receive an additional £5.5m of capital funding.

The draft Budget also included £3.7m to speed up planning decisions and digitise planning services.

The Welsh government said capital spending plans “will exceed £3bn for the first time at the draft Budget stage”, which will enable “substantial investments in the school estate, NHS infrastructure, housing and public transport”.

Mark Drakeford, Wales’ finance secretary and former first minister, said: “This is Budget for a brighter future, delivering an extra £1.5bn for our public services and priorities, helping to put Wales firmly back on the path of growth after 14 difficult years.

“This is in stark contrast to the last couple of years when we have been forced to make some very difficult and painful decisions.”

Stuart Ropke, chief executive of Community Housing Cymru, said: “To steer Wales out of the housing and cost of living crises, we need a dual focus on building the affordable homes so urgently needed and preventing more people from reaching crisis. Today’s draft Budget is an important step forward on both fronts.
“As housing associations build approximately 70% of social homes in Wales, the extra £81m capital funding allows us to continue to make progress at pace on building the new homes so urgently needed.”

Mr Ropke added that the increase in the Housing Support Grant meant that “support providers will be better placed to continue to run high-quality services, and pay staff fairly for the important work they do”.

The biggest increase in funding is going to health and social care, which will receive “more than £600m in extra revenue and capital funding” to help first minister Eluned Morgan deliver on her pledge to cut NHS waiting times.

“This draft Budget offers a real opportunity to start to rebuild and reinvigorate our public services. It delivers increases to all departments and a significant boost in capital funding, meaning more investment in the very fabric of our nation – in our school and NHS estate, in housing and in public infrastructure,” Mr Drakeford said.

Crucially, Welsh Labour needs to reach an agreement with another political party to pass the Budget, as it is one seat short of a majority in the Senedd.

Heledd Fychan, finance spokesperson for Plaid Cymru, said in an interview with Radio Wales Breakfast today that her party did not want to make a deal.

Plaid Cymru ended its co-operation with Welsh Labour earlier this year over concerns about former first minister Vaughan Gething’s leadership.

The draft Budget will now be scrutinised by members of the Senedd before a final vote in March.