City Hall to shift cash into Housing Zones
The mayor of London is set to shift up to £200m from the capital’s Affordable Homes Programmes into Housing Zones, over fears City Hall could miss its housing targets.
The Greater London Authority (GLA) wants to re-allocate funding from Boris Johnson’s £1.3bn Housing Covenant because the mayor may fall short of his aim to complete 42,000 affordable homes by 2018.
The government and the GLA have already agreed that £150m of unallocated funds in City Hall’s 2015/18 housing budget will be “re-profiled”, with the cash going towards Housing Zones. Mr Johnson is now expected to agree to allocate a further £50m, although a final decision on this has not been made by the mayor.
Minutes from the GLA’s Housing Investment Group say that government policies, including the 1% social rent reduction and the extension of the Right to Buy, has led to “uncertainty” over whether social landlords and house builders can meet their targets through the mayor’s affordable housing programmes.
City Hall officials believe that by giving £200m of the unallocated funds to Housing Zones, they can “maximise the housing delivery of all tenures in London”. This would leave £80m still available for continuous bidding for affordable housing programmes.
It is not clear why GLA officials think that Housing Zones will deliver more homes than the affordable housing programmes, but the minutes claim that the zones introduce “innovative thinking and flexible approaches”.
City Hall has already announced 20 Housing Zones, at a cost of £561.8m, expected to deliver 53,000 homes.
Officials believe the reallocated cash would fund 10 new zones, delivering at least 25,000 additional homes by 2026. A total of 6,000 of these would be affordable housing – defined as sub-market rent or low-cost homeownership – that would start on site by 2021.
Mark Miles-Lea, commercial director at Amicus Horizon, said: “I’m sure housing associations will be looking to get a slice of the Housing Zone funding but it depends on how the GLA will allocate money to [different tenures].”
According to the minutes, the government agreed that £150m of City Hall’s 2015/18 affordable housing budget will be shifted into the Housing Zones as part of the Spending Review this month.
They reveal that the Housing Investment Group is recommending the London mayor to approve the re-allocation of a further £50m, in order to shift a total of £200m to Housing Zones across the capital.
JARGON BUSTER
Housing Zones: A central government and City Hall-led scheme to provide funding for strategic interventions to speed up development, as well as an agreement giving certainty over planning permission.
Mayor’s Housing Covenant budget: The Greater London Authority’s £1.3bn fund to help build 42,000 affordable homes for sale and rent. It contains the 2015/18 programme for affordable housebuilding, as well other funds for care and supported housing, and hostel spaces for young people.
