Call for housing budget to be protected

The nation’s affordable housing crisis will plumb new depths after the election, unless the three major parties commit to protecting the housing budget, the country’s housing providers have warned.

The National Housing Federation and Home Builders Federation, the trade bodies for housing associations and private developers in England, fear that cuts of 25 per cent to the housing budget - as implied in the Budget - will have dire consequences for affordable housing provision - as well as the industry.

Cuts on this scale would mean:

• 574,000 planned affordable homes may not be built in the period up to 2020.

• 287,000 jobs in construction and related fields could be lost or not be created.

• First time buyers will see vital support disappear.

• The Government target to build 1million affordable homes, and 3million homes overall by 2020, could be missed by 20 years.

• 1.4million people may be added to housing waiting lists, which are already at record levels.

Given the impact big cuts in spending would have on affordable house-building, the Federation and HBF say that housing should be viewed in the same ‘untouchable’ terms as health and education by the political parties, and protected from cuts.

A smaller overall budget would also impact the private market as there would be less scope for schemes such as HomeBuy Direct, currently acting as a lifeline for many first time buyers to get on to the housing ladder, and so hit younger people hard whilst mortgage availability remains constrained.

National Housing Federation chief executive David Orr said: “Unless all three main parties commit to protecting the housing budget after the election, we could see affordable housebuilding falling off a cliff – with almost 600,000 planned affordable homes not being built.

“The Government believes that we need around 240,000 new homes every year. But if the housing budget is cut by 25 per cent the number of new homes being built annually could plummet to just 100,000 homes for the foreseeable future.”

He added: “As bad housing is closely linked to poor health and poor educational attainment a failure to protect the housing budget from the post-election spending cuts could lead to many people needlessly suffering from a triple whammy effect. Therefore, we call on all the main political parties to commit to protecting the housing budget.”

Stewart Baseley, executive chairman of the HBF said. “We already have a chronic shortage of housing in this country that is having significant social and economic implications. It is imperative that public spending to support affordable house building is maintained post election if the crisis is not to plunge to new depths.”