Healey unveils £250 million package to build 3,400 new affordable homes

A £250 million funding package to provide 3,400 affordable homes was announced by Housing Minister John Healey today.

Housing associations and other bodies throughout England will be handed the cash for building projects in a move which ministers hope will create around 5,000 jobs.

It comes a day after it was announced that 47 councils would receive a share of a £127 million Government funding pot for 2,000 new council homes.

That money will be matched by councils, bringing the total amount of cash pledged for affordable homes in the last two days to £500 million.

In June, Prime Minister Gordon Brown committed £1.5 billion for house-building on top of the £600 million announced in the Budget in April.

At the time ministers confirmed the extra money was not new cash, but would come from a reordering for priorities within the Department for Communities and Local Government and underspends in other Whitehall departments.

Today Mr Healey said the two projects combined would provide 5,400 cheap homes and create around 10,000 jobs.

"We are ready to use the power of Government and the benefit of public investment to help the country pull through recession by building the homes people need and creating the jobs that keep people in work," Mr Healey said.

"The £250 million funding I am announcing today will help tackle the shortage of affordable homes across the country, so associations can build the homes that families need.

"It will also provide a much needed shot in the arm for construction jobs."

Around a fifth of the new homes will be for first-time buyers, with the rest being used for low-cost rentals.