Shapps publishes framework for flagship affordable homes programme

The Housing Minister has fleshed out how the government’s flagship affordable homes programme will operate for 2011-15 with the publication of a framework document.

The document – published jointly with the Homes & Communities Agency – sets out how the programme will support the delivery of up to 150,000 new affordable homes.

A total of £4.5bn is to be made available over the next four years, and the framework document invites providers – whether local authorities, housebuilders and developers, affordable housing providers and local community groups – to bid for investment.

The HCA said £2.2bn of funding is currently uncommitted and available to fund eligible projects. However, providers will be asked to submit proposals covering the entire four-year period – in contrast to the previous funding model of continuous market engagement.

In a written ministerial statement, Grant Shapps said the new Affordable Rent model – a key element of the programme – would “make public subsidy go further while also enabling local authorities and providers to target support where it is most needed.”

This model will allow landlords to make homes available to new tenants at up to a maximum of 80% of gross market rents. Providers will also have the ability to convert a proportion of their social housing to affordable rent. The rights of existing tenants will not be affected.

The HCA said: “The framework makes clear that proposals must meet local priorities, with pro-active discussions between local authorities and providers key to success. The HCA – through its enabling role – will act as a bridge between local authorities and providers to help deliver homes in line with local needs.”

Pat Ritchie, the agency’s chief executive, added: "This new approach gives increased flexibilities for local authorities and providers to plan ahead and deliver much needed affordable homes. At a time when funding is tight, this new way of operating will allow us to do more with less resources, but it will rely heavily on effective working partnerships, which is where the HCA will play a significant part."

A copy of the framework document, which sets out how the HXA will assess the bids, is available here. Proposals must be submitted by 3 May 2011.

In other announcements, Decentralisation Minister Greg Clark has launched a consultation on a technical revision to Annex B of Planning Policy Statement 3, “to make clear that Affordable Rent falls within the definition of affordable housing for planning purposes”.

The Housing Minister has also – “to give providers more certainty over future income” – confirmed that the existing inflation-linked formula for annual rent increases in social rented housing will continue to apply throughout the 2011-15 period.