Beckett and Blears welcome Pre-Budget Report 'boost' for social housing » Housing » 24dash.com

Communities Secretary Hazel Blears and Housing Minister Margaret Beckett have welcomed proposals in the Pre-Budget report that will support families and business through the current tough financial times and lay the ground work for future economic recovery.

Included in today's PBR are plans to bring forward £775m housing and regeneration capital spending that will support the construction industry over the next two years, the period when it needs the Government spending support most.

This will help preserve jobs and skills in the sector for the upturn whilst delivering home improvements and energy efficiency measures that will benefit thousands of families.

The Chancellor has also outlined plans to extend the wide range of support the Government is putting in place to make sure that hard working households who suffer a loss of income always have the option to stay in their homes, and that repossession is always a last resort.

Communities Secretary Hazel Blears said: "In the current climate it is right that we bring forward spending to support the economy now. Our priority is making sure that individuals and families as well as business have the practical support they need to protect them against the effects of this downturn and ensure we are well placed to make the most of the upturn when it comes.

"That means helping people stay in their homes and jobs, helping local businesses stay afloat and easing the burden wherever possible.

"We will use the flexibility in our spending to accelerate the delivery of our priority  programmes - delivering more social housing, ensuring existing stock is decent, warm and energy efficient, continuing to drive economic regeneration and support local economies."

Housing Minister Margaret Beckett (pictured) said: "We are determined to do everything possible to provide real help now to homeowners facing tough times, and that means doing all we can to ensure repossession is always a last resort.

"It is our priority to make sure that hard working homeowners who suffer a loss of income through no fault of their own have the option to stay in their homes. The new measures announced today will expand the support available to those who need it most.

"Everyone needs to do their bit to help families avoid the traumatic impact of repossession, and we expect lenders to do more to build on work already underway to help their customers."

The £775 million funding will be used to support the following programmes:

• Bringing forward Decent Homes work - £250m will be available to fund improvements in 25,000 homes. These properties will benefit early from home improvements including measures to make homes more energy efficient. £130m will be available for planned improvements in 2008-09 and £120m brought forward to 2009-10. This will mean that we are able to further reduce the number of non-decent social homes by providing new boilers, windows and loft insulation as well as improving kitchens and bathrooms ahead of schedule.
• Major Repairs to council housing - Council tenants will benefit as £175m is brought forward from 2010-11 to 2009-10 to carry out repair and maintenance work. This acceleration of upgrade work to council housing will mean that in some cases councils will be able to avoid doing piecemeal repairs and instead start on major replacement programmes.
• New homes for social rent - £150m will be available in 2008-10 for the provision of around 2,000 new homes for social rent in addition to the £400m (for around 5,500 new homes) brought forward as part of measures announced in September.
• Regeneration projects - £100m funding will be brought forward to complete key transport projects in the Growth Areas and support regeneration projects which might otherwise not go ahead in the current market. This will help maintain the momentum of key projects in the regions and national regeneration priorities.
• Regional Development Agencies - The Government is working with RDAs and regional partners to consider how they may bring forward up to £100 million from future years to support priority projects in the regions.

Other measures outlined in the PBR include:

• Support for those at risk of repossession - The Government has today announced further steps to help families at risk of repossession. These include: bringing forward the Government's £200 million Mortgage Rescue scheme to start early in a number of local authority areas. More than 60 councils throughout England will be 'fast tracking' the set up of the Mortgage Rescue scheme and will start taking applications from the beginning of December; enhancing the Mortgage Rescue scheme to cover vulnerable families at risk of repossession because of additional loans secured on their home. Often families are more likely to default on these loans because of higher interest rates.
• Business rate relief - Certain businesses will be given more time to pay backdated business rates tax arrears. Eligible businesses who are faced with backdated liabilities, such as the recent example in ports, will be able to spread payments over a number of years instead of paying one immediate lump sum.
• Empty Property rate relief - From April, there will be a temporary increase in the threshold for empty property rate relief, so that empty commercial properties with a rateable value below £15,000 - an estimated 70 per cent of empty properties - will be exempt from empty property rates. A three-month exemption will still apply for empty commercial properties with rateable values above £15,000, and a six-month exemption is still in place for empty industrial properties.
• Devolution to city-regions - Building on the sub-national review, we will agree a package of devolutionary measures with city-regions to increase their ability to drive forward sustainable economic growth. Building on the successful multi-area agreements, these new agreements will give participating authorities greater freedoms to better adapt to their particular economic circumstances. For example, working with employers, city-regions could have the opportunity to exert greater influence over skills provision in their areas. The Government intends to announce new agreements with at least two forerunner city-regions at Budget 09.

Chartered Institute of Housing Chief Executive, Sarah Webb, said: “Many of today’s announcements will provide much needed support to people at risk of losing their homes, unable to access finance or on waiting lists for social housing.

"It also offers some assistance to housing providers operating in a particularly tough climate.  However, while this stimulus package is important in the short term, questions remain unanswered around the long-term challenges facing housing.  In order to make the most of any new money, it must go hand-in-hand with new approaches to supply and affordability.

"The problems with current development models for affordable and market housing are not going to be solved by finance alone.  We look forward to working with government, the Homes and Communities Agency and the Tenant Services Authority to make sure that the brought forward investment announced today translates in to more homes.”

Shelter chief executive Adam Sampson welcomed the Pre-Budget Report, but added: "Some of these measures are welcome, but the Chancellor's failure to increase the amount of money for social housing means the Government will not achieve its three million house building target, or ease the hardship of the five million people on council house waiting lists.

Mr Sampson said the announcement on ISMI, the three months repossession grace period, and injection of cash for Mortgage Rescue Schemes and debt advice will help some homeowners.

But he added: "If Mr Darling really wants to make a difference to struggling households he should be making sure lenders allow homeowners to switch to interest only mortgages, extend the repayment term, put outstanding debt onto the mortgage and take a repayment holiday."