Affordable Homes Programme set to receive £1bn top-up

News21.10.2410.15 AM by James Riding

A £1bn top-up to the current Affordable Homes Programme (AHP) is expected to feature in next week’s Budget, it has been reported.

Chancellor Rachel Reeves (centre) and housing secretary Angela Rayner (right) have reportedly agreed a top-up to the AHP (picture: Alamy)

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Affordable Homes Programme set to receive £1bn top-up #UKhousing

A £1bn top-up to the current Affordable Homes Programme is expected to feature in next week’s Budget, it has been reported #UKhousing

Deputy prime minister and housing secretary Angela Rayner has been handed “almost £1bn” to help landlords build social housing, The Times reported.

The funds will be released over the next 18 months to support the final year of the current AHP, which was set by the previous government and runs until 2026.

Allies of Ms Rayner reportedly saw the top-up as “a down-payment on far bigger sums” in next Spring Spending Review, which will set out the scope of Labour’s next five-year grant funding programme for affordable housebuilding.

Reports also suggested that Ms Rayner will announce her long-trailed reworking of Right to Buy rules along with the Budget on 30 October. Existing tenants will have to pay “tens of thousands of pounds more” to own their homes as discounts are lowered from up to 70% of purchase prices to closer to 25%.

The policy will be restricted to tenants who have lived in their home for 10 years, up from three. In addition, Ms Rayner is reportedly considering scrapping the Right to Buy for new build homes.

The government has pledged to lower the discounts offered to council tenants to help them buy their home in order to slow the rate at which social homes are lost every year.

A total of 24,392 social homes were sold off in England in 2022-23, while just 9,561 new social homes were completed. Ms Rayner has pledged to build enough social rented homes to stop this net loss by April 2026.

The new AHP funding is said to have been easier to agree with the Treasury as chancellor Rachel Reeves is changing the government’s fiscal rules to free up billions of pounds for investment in infrastructure.

Approvals under the current AHP have slowed since the general election was called earlier this year. Last month, Peter Denton, chief executive of Homes England, explained that “four years into five” of the current programme, “we are coming towards the end of that deployment period” and “there is limited capital that remains uncommitted”.

A multi-year AHP is set to follow in the Spring Spending Review in early 2025, at which Ms Rayner is expected to press the chancellor for “billions of pounds more”.

Clare Miller, chief executive of Clarion housing association, said the indications from government “are really positive”.

She said: “It is clear there is a good understanding of the barriers social housing providers face in building new homes and we very much welcome all the measures to tackle these discussed to date. Now is the time for an overarching, long-term plan for housing that encompasses these measures, and gives us the certainty we need in order to build more homes and keep delivering for our existing residents.”