How seriously does the Government take housing? The fate of the Affordable Homes Programme is the first test

Three months ago, in the run up to the general election, David Cameron announced housing as one of the Conservatives six campaign priorities. It followed years of rising anxiety among voters about the issue. In that speech the Prime Minister promised voters he would “build more homes that people can afford”. A month later, as you can see below, he stood on the steps of Downing Street, pledging that the next five years would in part be about “the homes I want to build”. The Conservative manifesto committed the government to delivering 275,000 additional affordable homes.

Today, Shelter supporters have begun writing to George Osborne, asking the Government to keep their word– and to protect and boost investment in new affordable homes in the Budget and Spending Review. 

In particular, Shelter are asking the Chancellor to at the very least protect the Affordable Homes Programme from any further cuts for the rest of this Parliament. This is something you will hear more about from us, as well as from some of the country’s most high-profile business voices, in the near future. 

 So why do we care?

The Affordable Homes Programme is the last vestige of public investment in new homes. It is imperfect in lots of ways. But the £1bn spent on it is vital to the supply of new affordable homes in this country. As Rachael outlined this week, it delivers desperately needed new affordable homes to rent for working people who can’t afford the sky-high costs of private renting.  And it builds ‘part-buy, part-rent’ homes for young families who can’t afford full ownership, but want to buy a stake in their home.

In total, it funds around 75% of all affordable homes that get built each year and, astonishingly, last year it accounted for half of all homes built in England in total.

Sadly, it is very likely under threat. As a non-protected department, the Department of Communities and Local Government is facing huge spending cuts. Ministers and civil servants are currently scouring it for significant savings. And when they did so in 2010, they cut investment in new affordable homes by 60%, dramatically reducing the supply of social rented homes.

There are also rumours in the sector that funding from it could be diverted away from affordable homes to support the governments ‘Starter Homes’ initiative – homes that simply aren’t affordable for working people on typical incomes.

Cutting or undermining the Affordable Homes Programme now would lead to higher rents, more homelessness and a bigger housing benefit bill for the Treasury. Even more people than now would find it harder to afford a decent, stable home they can call their own.  After an election in which politicians of all parties promised to make the housing crisis better, not worse, voters would surely take a very dim view. 

Compared to every other major area of public life, our investment in new homes is woeful – and has been for a generation. Indeed, we are about to spend over five times more renovating two houses – The Houses of Parliament – than we do building homes for our own population.

Of course, Budgets are tight across government. The private sector has a responsibility to build homes too. But it cannot do so if left on its own. If the government takes the housing crisis seriously, it simply has to put its money where its mouth is. The simplest truth is this: the Prime Minister simply cannot meet his pledges on affordable housing by cutting funding for affordable housing.

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 This government has a huge opportunity to be the one which solves England’s housing crisis – recapturing the spirit of the great post-war Conservative governments (above and below).

After years of inaction by successive governments of all kinds, and with the economy recovering, it could roll up its sleeves and be the party that ended a crisis threatening the hopes, dreams and aspirations of millions of people across the country.

But with the election gone, the time for talk is over – and the time for action has begun. The fate of the Affordable Homes Programme will be the first big test. We can’t protect it without your help, so please join Shelter’s campaign.

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