Autumn Budget 2024: reaction from the sector

Landlords and trade bodies

Kate Henderson, chief executive of the National Housing Federation: “Today’s Budget demonstrates the government’s commitment to social housing, recognising it alongside the NHS and schools, as part of the vital infrastructure of our country.

“With the delivery of new social homes at risk due to funding constraints, a £500m top-up to the Affordable Homes Programme is hugely welcome and something we’ve been urgently calling for to prevent a collapse in delivery. We also support the government’s decision to review Right to Buy discounts. With record levels of overcrowding and child homelessness, it is vital we protect our existing social homes.

“We are pleased to see some progress on funding for building safety work in social housing. However, additional long-term funding is key to ensure money is not diverted from existing residents and new social housing. We also look forward to working with the government on a new rent settlement consultation. With our sector facing financial pressures due to decades of cuts, this will provide long-term certainty for social housing providers and transparency for residents.

“The £3.4bn kick-start for the Warm Homes Plan is a welcome first step towards the government’s manifesto commitment of £13.2bn, helping to tackle fuel poverty and the climate emergency. 

“While there is much for social housing providers to welcome in today’s Budget, it is disappointing not to see funding for supported housing, which is currently in crisis, with three in five providers forced to close schemes in the last year."

Fiona Fletcher-Smith, chair of the G15 and chief executive of L&Q: “There is much to appreciate in this Budget, especially the £500m pledge to the AHP. We are also pleased with the government’s promise to support the remediation of social homes to remove dangerous cladding, which was previously mostly available to private landlords.

“However, the introduction of a five-year rent settlement for social housing providers at CPI+1% [Consumer Price Index plus 1%] falls short of what is urgently needed. Not-for-profit housing associations require a minimum 10-year settlement to help ensure the long-term stability and confidence necessary to meet the government’s ambitious target of delivering 1.5 million homes during this parliament. We look forward to setting out more detail on this in the forthcoming consultation on a long-term rent settlement.”

Mark Washer, group chief executive of SNG: “The chancellor is right to put housing at the heart of her first Budget – it has the greatest potential to drive the economic growth and social progress she wants to achieve.

“Plans to agree a long-term rent settlement are very welcome. This is a firm indication that the government is serious about addressing the national housing crisis by giving housing providers the certainty they need to build more new homes and invest in existing homes. We also welcome the decision to invest in planning officers and in the remediation of dangerous cladding.

“The additional funding for the Affordable Homes Programme is also welcome, and we look forward to working with the government ahead of the Spending Review to support the delivery of a new much-needed long-term housing strategy.”

Mark Perry, chief executive of Vivid: “These announcements indicate the government understands the pressures the sector’s facing and we should take some comfort from this. Of course, having to wait for the outcome of the Spring Spending Review linked to the next Homes England AHP is not ideal given the ambitious housing target for this parliamentary term, but in any event it’s vital this future funding programme is significant and has flexibility.”

Bjorn Howard, group chief executive of Aster: “We’re encouraged by the social rent consultation announced in the Budget. A five-year settlement will help create some certainty. It means we can better plan for the long term for vital things like our investment programmes in our existing homes so they’re the best quality they can be, while continuing our work to support our customers with their financial well-being.

“Further support for social housing is good news, and we welcome every government measure that helps address the housing crisis. Today’s additional funding for the Affordable Homes Programme is another positive step forward and we hope it’s a sign of greater things to come in the Spring Statement. It’s also encouraging to see the funding for 300 new planning officers, recognising the pressures local authorities are under when it comes to managing the applications for much needed affordable homes.

“Support for every type of tenure is essential if the country is to deliver a safe, quality home for everyone. This includes shared ownership, which is an underutilised route to owning a home, and community-led housing projects. Schemes like these which allow local voices to be heard during their design will be an important part of the plan to create truly affordable homes. Collaboration will be critical, and we will continue to play our vital role in supporting housing delivery.”

Lee Bloomfield, chief executive of Manningham Housing Association: “The chancellor’s confirmation of £500m of new funding for the Affordable Homes Programme is certainly a positive – increasing it to £3.1bn – but, given the additional money will deliver only 5,000 of the 1.5 million new properties ministers have committed to provide over the next five years, it is merely a drop in the metaphorical ocean.

“The promised five-year social housing rent settlement will offer a degree of much-needed financial stability for housing associations, with the possibility of a 10-year settlement after a consultation process.”

Matthew Walker, chair of PlaceShapers: “We strongly welcome measures that will immediately lead to more safe, secure, affordable homes and begin to alleviate the nightmare of 1.29 million households waiting for them. 

“The immediate priority now must be to meet government confidence in the sector by showing we’ve done all we can to stretch our capacity to build the new homes we need to address escalating housing demand and the crisis in temporary accommodation. 

“We have already shared with the housing minister examples of how members could use the additional £500m now in the Affordable Housing Programme to swiftly move ahead with work, which will immeasurably improve the lives and homes of people who have already been waiting decades for their communities to be transformed due to lack of funding.

“Any gap in funding for new affordable homes would have meant schemes that are ready to go would face significant delays, taking us further from the government’s target of building 1.5 million homes over this parliament.”

A spokesperson for Sage Housing: “As England’s largest provider of affordable new homes, we welcome the chancellor’s announcement of further government investment into the sector alongside commitments around rent settlements. 

“These will bring long-term certainty and encourage further investment from institutions such as pension funds, which will be vital if we are to address the chronic undersupply of affordable housing in the UK. We look forward to playing our part.”

Ian McDermott, chief executive of Peabody: “The measures announced today are a step in the right direction. The consultation on longer-term rent certainty for councils and not-for-profit housing associations is particularly welcome. 

“The additional public investment to help fund social homes is a positive signal of intent. And we’re pleased to see help for people on low wages, as well as support for our local council partners. Unsuitable and expensive temporary accommodation, overcrowding and the homelessness emergency are shared challenges for us all.

“For as long as I can remember, social and supported housing has been treated as a cost by governments.

Looking ahead to the Spending Review next year, it’s time for that to change.

“It’s time for social housing to be recognised as vital infrastructure for the country – an investment in the future, a way to secure significant social and economic benefits, and essential for inclusive growth.”

Jonathan Higgs, chief executive of Raven Housing Trust: “Today’s Budget signals an important step in tackling the urgent issue of homelessness.

“Currently, over 1,400 households are on the [Reigate and Banstead Borough] Council’s waiting list – a rise from 1,300 at the end of last financial year – and over 1,800 households approached the council last year due to being threatened with homelessness.

“Last year, only 213 allocations into social housing were possible across the borough, highlighting the gap between demand and available affordable housing. We are committed to bridging this gap by working alongside the council to offer sustainable, quality housing options that prevent homelessness and support the community’s most vulnerable residents.

“The main drivers of homelessness in Reigate and Banstead are the end of private tenancies, evictions by friends or family, and an increase in those required to leave Home Office accommodation. Addressing these underlying issues, alongside boosting affordable housing supply, is critical to prevent further escalation. We urge the government to build on today’s commitments with sustainable, long-term funding that meets the needs of the community and tackles the complex factors behind these numbers.”

Elizabeth Froude, group chief executive of Platform Housing Group: “We are pleased to see spending being increased to deliver much-needed housing in today’s Autumn Budget announcement by the government. However, the sector still needs longer-term income certainty and support for decarbonisation and energy improvement of existing homes which we hope will be confirmed in next year’s Spring Budget.

“While we understand the chancellor’s need to balance the budget, the increase in employment costs will put further financial pressures on the sector in a period where our income will increase very little next year, with much to be absorbed in terms of increasing regulatory and legislative obligations and will undoubtedly impact on our ability to recruit additional colleagues to support these areas.

“We will continue to work with the government and its various departments to facilitate growth and our housebuilding mission, but will find it harder to do so without further risking erosion in financial strength or reducing the scale of other deliverables.”

Paul Dolan, group chief executive of Riverside: “We welcome the chancellor’s focus on affordable housing and taking the first steps towards achieving the government’s mission of building 1.5 million new homes in today’s Budget.

“The £500m boost to the Affordable Homes Programme will help with delivery in the short term, but the acid test will come in next year’s Spending Review when long-term funding for the AHP will be decided.

“As one of the biggest developing housing associations, we stand ready to work with the government to achieve its housebuilding mission. However, we need the long-term financial certainty to match our commitment through a 10-year rent settlement and increased funding.
“We welcome the new investment in building safety and in homelessness prevention to ensure our customers can live in safe and secure homes.”

Tracy Harrison, chief executive of the Northern Housing Consortium: “We’re pleased that there’s been a strong focus on housing in the Labour government’s first Budget, recognising the importance of a home that everyone can afford. The measures announced before the Budget are all good first steps, but there is much to do before we will see a real impact in communities across the North.

“The Spending Review will be critical. To make the biggest difference in the North, the government must provide long-term investment to build new social homes and unlock brownfield land, make existing homes greener, warmer and safer, including those in the private rented sector, and regenerate communities across the North.  

“The government is continuing to deepen devolution, with more areas set to receive integrated settlements, increasing local control and supporting a more joined-up approach to spending. This will help make sure investment delivers real change for Northern communities and is something which should be expanded further in coming years.

“We are pleased to see a commitment to the Warm Homes Plan, but need further clarity on levels of investment in social housing. Investment in the North of £500m per year for the next five years and £1bn for the following five years would kick-start supply chain growth and create thousands of good green jobs.”

Priya Nair, chief executive of The Housing Finance Corporation: “It’s encouraging to see a new five-year social housing rent settlement of CPI+1%, with 100 new planning officers. This will boost social housing stock and enable councils to invest for the future, especially with the reduction in Right to Buy discounts to protect existing homes.

“Ms Reeves’ promise that the government will invest more than £5bn to deliver their housing plan is a much-welcomed move. Though there still remains the question of whether this will be enough to tackle the UK’s acute housing crisis.

“To truly make progress, the sector must seek new partnerships and innovative financing, combining public funds with private investment to meet ambitious housebuilding targets. This approach also applies to sustainable housing, where collaboration is key to achieving climate goals.

“The government should introduce incentives for private sector investment in green projects to accelerate progress toward net zero. Ultimately, it’s time for the government to view housing as vital national infrastructure and invest more in affordable housing and housebuilding initiatives.”

Charities

There was still much concern from charities that too many people will struggle this winter, that private renters will be let down by the choice to keep Local Housing Allowance rates frozen, and other groups will be disproportionately left out or affected by the spending plans.

Paul Kissack, chief executive of the Joseph Rowntree Foundation: “Today’s actions alone won’t be enough to fix the foundations for millions who struggle winter after winter in devastating hardship. The chancellor is right that change must be felt. The people who needed to feel the most change are those living in and at risk of hardship. 

“Limiting the devastating impact of deductions is a good step. There was also welcome investment in social homes, help for carers to work and care, and a rise in the minimum wage.

“It’s deeply worrying that we haven’t seen changes to social security that will seriously bring down hardship. In particular private renters will feel let down by the choice to keep Local Housing Allowance frozen, [which] means that it will become further out of step with local rent levels, which have soared in recent years. 

“People receiving sickness benefits also face a fearful future at a time when almost two-thirds of those experiencing destitution have a long-term health condition. The government has failed to explain how they will save £3bn from the benefits bill and will offer no certainty and more anxiety rather than the respect they deserve.” 

Polly Neate, chief executive of Shelter: “With homelessness at record levels and a temporary accommodation bill in the billions, we desperately need investment in genuinely affordable social homes. The government’s announcements to top up the Affordable Homes Programme and limit Right to Buy are the first steps in delivering these.

“A chronic shortage of social homes combined with rocketing private rents is tearing communities apart, pricing families out of their local areas and pushing over 151,00 children into homelessness. Families are forced to live out of suitcases, stuck in grotty homeless accommodation for years. 

North of the English border, Alison Watson, director at Shelter Scotland: “Having declared a housing emergency, it’s clear that the Scottish government must back words with actions.

“It is vital that any capital funding which becomes available as a result of the chancellor’s investment plans is in turn used by Scottish ministers to deliver social homes here, but we also need to see growth in the capital budget over a sustained period to support continued investment.

“Delivering more social homes remains the single most effective way to tackle the housing emergency in Scotland, and only the Scottish government can decide how much of its budget it commits to that endeavour.

“However, we can’t ignore the role that austerity has played in exacerbating Scotland’s housing emergency. The freeze on Local Housing Allowance and the two-child limit has forced thousands into poverty; they will continue to do so as it seems the chancellor has chosen to keep them in place.”  

“Building social housing saves the taxpayer money, boosts jobs, reduces the burden of poor housing on our NHS and, crucially, will end homelessness for good. The money freed up by today’s changes to fiscal rules should now be used at the Spring Spending Review to deliver the 90,000 social homes a year this country needs.”  

Carole Easton, chief executive of the Centre for Ageing Better: “Amid the spending cuts and tax rises of this Budget, it is vital that this government holds true to their missions and their long-term vision. We need this government to consider the 50+ age group in all its areas if it wants to grow the economy, reduce pressures on public services and lower the numbers of people ageing in poverty, damaging their health in dangerous housing and unable to access essential services.

“Funding to tackle economic inactivity by reaching people not usually in touch with the employment support system is welcome and desperately needed, particularly for 50 to 65 year olds who account for half of the economically inactive due to long-term illness or disability in this country.

“But if this funding is to help the government hit their ambitious target of 80% employment rate, the country needs to see a significant increase in employment rates for two age groups: 18 to 24 and 50 to 64. Plans are already underway for a Youth Guarantee.

“Now we need a similar ambition to drive up the employment rate at the older end of the labour market, with much higher service standards for 50+ jobseekers and innovation funds to support service providers to achieve them. The scale of capital investment announced in this Budget will require people to deliver it, that means the retention of the skills and experience of older workers who are key to the construction sector is essential. 

“The benefits of closing the employment gap between 50+ workers and other age groups is clear: it would contribute towards a £9bn annual boost to the economy. The consequences of failing to do so are also clear: people in their 60s already have the highest rates of poverty of any adult age group and their numbers are set to swell when the state pension age rises to 67 by the end of this parliament.

“The Autumn Statement brings welcome news of funding which could help deliver a sizeable amount of desperately needed new social and affordable housing. We have to make sure that these homes are the right kind of homes that can support residents of all ages; we need these homes to be built to high levels of accessibility and not exacerbate the ongoing crisis of poor-quality housing.”

Law firms

Legal experts told Inside Housing that the government is still ignoring issues around Section 106, and that local authorities will need support to upskill their development teams and access to additional funding.

Jonathan Cox, partner and head of social housing at Anthony Collins: “The decision to top up the Affordable Housing Programme with funding to the value of £500m is welcome, but 5,000 additional affordable homes is nowhere near enough to meet demand for affordable and social housing after years of shrinking supply. All eyes will be on what the AHP will be for 2026 onwards.

“There is a systemic problem here that the government has so far chosen to ignore. Private sector property developers have been used to operating on 40% profit margins when selling Section 106 agreements to housing associations, and few are willing to accept less. Many housing associations have stopped bidding for such agreements because they don’t stack up financially. Planning reforms – in particular the removal of ‘hope value’ for development land – could make a difference, but even then it would seem unlikely that developers would voluntarily drop their prices further.

“Fundamental changes are needed, and many housing associations and other registered providers of social housing believe developers should be forced to sell their Section 106 agreements at cost (based on the cost of the build alone). If a figure can’t be agreed, then it should be adjudicated upon by an independent body in a similar way to fair rent legislation. Alternatively, local authorities could take a leaf out of Harrogate Borough Council’s book and set the price that registered providers are required to pay for affordable housing in Section 106 agreements in the local area.”

Louise Drew, partner and head of the building communities team at Shakespeare Martineau: “This Budget is a welcome breath of fresh air. With changes to Right to Buy, the introduction of a rent cap and a boost to the Affordable Homes Programme, the new government has proven it is not pandering for votes, but actively creating sound policies to fix a neglected, broken system.

“It’s impossible to predict whether these changes will be enough to solve all the sector’s woes, but they are a positive start and focus on a long-term solution that is flexible to change, while still providing security, certainty and sustainability for the sector.

“This government seems to finally understand that any housing strategy must be designed to last longer than the average six-month lifespan of the average housing minister under their predecessors. If this approach continues, the sector will thank them for it.

“Right to Buy has been widely criticised this year, with many calling for its scrappage. Some may say the government is being cowardly by not taking this stance, however, Right to Buy provides many people with their only opportunity for homeownership. It’s right that an attempt should be made to fix it before getting rid of it completely.

“Between its implementation and the end of March 2023, over two million homes were purchased through the scheme. However, the financial pressures faced by local authorities have meant a huge number of these haven’t been replaced with new stock, leading to a bigger deficit, longer waiting lists and overwhelmed councils.

“It’s hoped that reducing the discount and allowing local authorities to retain the full receipt from any sales will allow councils to get a head start on creating a sustainable housing pipeline to replace stock at the rate it is being lost.”

Matt Cowen, senior associate at Winckworth Sherwood: “The sector will be heartened to see a short-term injection of £500m into the current Affordable Homes Programme, as well as a proposed five-year CPI+1% rent settlement, providing longer-term certainty on rents for RPs [registered providers] and those looking to invest into the sector. The proposed reforms to Right to Buy, reducing discounts and enabling councils to again keep 100% of receipts will also be well received by many across the sector.

Charlotte Cook, partner at Winckworth Sherwood: “The Labour government has unleashed a welcomed new wave of council house development. It is long overdue and of fundamental importance with the current temporary accommodation crisis facing councils. But it is not without its challenges.

“Local authorities have lost much of the expertise they once had when they built, owned and managed large property portfolios. That will need to be rediscovered and re-energised. Many local authorities do have development companies and it would be sensible for the government to allow those to access any future funds.

“Many local authorities are already actively buying back good-quality homes that were sold under the Right to Buy. If this funding is used to accelerate this, there is the risk that local authorities may find themselves under fire for rewarding tenants twice – first under the Right to Buy discount and then buying homes back at much higher market value.

“Right to Buy has been enormously successful, enabling thousands of people to purchase their council home. But it has decimated local authority housing stock due to the restrictions on use of Right to Buy receipts to build new homes. Allowing local authorities to retain receipts is vital and welcomed.”