William Eichler Thursday, March 20, 2025

Overstretched finances threaten 1.5m housebuilding target

Overstretched finances threaten 1.5m housebuilding target image
Image: Jevanto Productions / Shutterstock.com.

The pressure on social housing finances at the local level could undermine the Government’s ambition to build 1.5 million houses this parliament, council chiefs warn.

A Local Government Association (LGA) survey looking at the financial stability of Housing Revenue Accounts (HRAs) revealed that 72% of all respondent councils with an HRA are 'very' or 'fairly' likely to draw down on reserves to balance budgets for 2025/26.

All of the survey respondents said they would likely increase council housing rents with 67% also expecting to reduce real terms spending on supervision and management, and 57% on repairs and maintenance.

While the Government is consulting on a long-term rent settlement for the sector and is offering CPI+1% over five years, only 38% were confident that this would allow them to invest in planned new build programmes.

The survey also found that only 61% of respondents said that they were ‘very’ or ‘fairly’ confident that this settlement would allow then to balance their budgets.

The LGA is calling on the Government to use the Spending Review to restore over £600m in lost revenue due to the rent cap in 2024/25 and to provide a long-term rent settlement that supports financial stability for HRAs.

It added that without immediate support local authorities would struggle to finance new affordable homes, undermining the Government’s plans to build 1.5 million homes over the next five years.

SIGN UP
For your free daily news bulletin
Highways jobs

Youth Engagement Worker

Wakefield Council
Grade 7 SCP 19 £16,030.50 - Grade 7 SCP 23
What will be expected from me? Wakefield, West Yorkshire
Recuriter: Wakefield Council

Family Hub Support Worker

Wakefield Council
£14,299.00 - £15,768.50, Grade 6
We are seeking two Family Hub Support Workers to support our Children and Young People Service Team. Wakefield, West Yorkshire
Recuriter: Wakefield Council

Youth and Community Development Support Worker

Wakefield Council
JNC 5 £25,580 - JNC 6 £25,919
Are you passionate about making a difference to our citizens and the district that they reside in? Wakefield, West Yorkshire
Recuriter: Wakefield Council

Care Assistant

Wakefield Council
£17,560.14 - £17,839.86, Grade 4
We are looking for an experienced Care Assistant as part of our Flanshaw Lodge Care Team. Wakefield, West Yorkshire
Recuriter: Wakefield Council

Development Management Officer - Flood WMF2963e

Westmorland and Furness Council
£42,839 - £44,075
This role supports the Council’s range of flood and coastal risk management functions Barrow in Furness, Cumbria
Recuriter: Westmorland and Furness Council
Linkedin Banner