The Prime Minister delivered a major speech on the economy on 30
June promising to "Build, Build, Build" but there was little detail
of any significant new money for social and affordable housing
other than confirmation of the £12billion allocated to a 5 year
Affordable Homes Programme from 2021 as previously announced in
the March 2020 Budget.
The Prime Minister emphasised the need for bold and urgent
action to respond to the "vertiginous" drop in GDP caused by the
coronavirus and promised a 'New Deal' based on major infrastructure
investment to create jobs and increase productivity across the
whole country, delivering on the Government's 'levelling up'
agenda. He also announced the intention to bring forward
shortly "the most radical reforms of our planning system since the
end of the second world war".
The Key points of the Prime Minister's speech
were:
- A promised "New Deal" to deliver jobs, skills and
infrastructure and to "build back better" in the wake of
coronavirus, for the benefit of all parts of the country.
- £5bn of infrastructure investment will be "brought forward";
more detail has been provided on how money allocated in the Budget
will be spent, but there does not appear to be any new money.
- An announcement of major reforms of the planning system,
including greater flexibility to convert commercial properties into
homes.
- Confirmation of the £12 bn Affordable Homes Programme announced
in the Budget.
- Included in the Affordable Homes Programme will be a 1,500
homes pilot of "First Homes" to be sold to first time buyers at a
continuing 30% discount.
- Further details of spending plans are expected to be announced
by the Chancellor shortly and a National Infrastructure Plan will
be published in the Autumn.
The Prime Minister's speech itself was relatively light on
detail, particularly about the housing and planning implications
but some further information was provided in Government press
releases issued to coincide with the speech.
Infrastructure
The Government will invest £5bn to accelerate infrastructure
projects, including:
- £1.5bn this year for hospital maintenance and improvements
- £100m this year for 29 road investment projects
- £1bn for school rebuilding, starting this year and £760m for
repairs and upgrades to schools and FE colleges
- £142m for digital upgrades and improvements to courts, £143m
for prisons.
- £900m for a range of 'shovel ready' local growth projects and
£96m for town centre investment.
These announcements appear largely to be confirmations that sums
allocated in the March Budget will be spent as planned, together
with some further details set out in an accompanying press release on how
they will be spent.
A second
accompanying press release from No10, primarily
dealing with planning reform, gives more information on measures to
support homebuilding, including on the deployment of the £12bn
allocated to the Affordable Homes Programme in the March
Budget.
Proposed changes to the planning system
include:
- Reform of the Use Classes Order to allow more changes of use of
commercial premises without the need for local authority consent,
including changes from commercial to residential use;
- Builders will no longer need a normal planning application to
demolish and rebuild vacant and redundant residential and
commercial buildings if they are rebuilt as homes;
- Property owners will be able to build additional space above
their properties via a fast track approval process, subject to
neighbour consultation;
- The Government will publish a Planning Policy Paper in July
setting out plans for comprehensive reform of the planning
system.
Measures announced to support home building
include:
- Confirmation that £12bn will be allocated to the Affordable
Housing Programme, as announced in the March Budget, to support
delivery of up to 180,000 new affordable homes for ownership and
rent. The briefing appeared to say that this would be spread over 8
years; however, MHCLG has subsequently clarified that it is for a
five-year programme, as the Budget announced. There is as yet no
detail of what proportion of the Affordable Homes Programme will be
available for social rented housing or any detail of regional
allocations. We expect such details will be included in the Homes
England prospectus when published but there is no date for this as
yet.
- A 1500 homes pilot of First Homes to be included in the
Affordable Homes Programme. First Homes will be sold to first time
buyers at a 30% discount which will continue when the home is
resold;
- Allocations are announced from the £400m Brownfield Land Fund
to support the delivery of around 24,000 homes;
- £450m is to be added to the Home Builders Fund to support
smaller developers access finance.
Click here to read the full text of the Prime
Minister's speech