Budget 2017 housing announcements

The Budget contained a number of housing-related announcements, including changes to Universal Credit, an update on Voluntary Right to Buy and the Government’s expanded housing programme.

22 November 2017

Changes to Universal Credit

The Chancellor announced changes that will make a huge difference to the thousands of tenants struggling on Universal Credit.

  • The seven day wait will be removed from the start of a Universal Credit claim, which effectively gives claimants an extra’s week’s money and reduces the amount of time they will wait.
  • Universal Credit claimants will also now continue to receive Housing Benefit for two weeks, which will help prevent tenants falling into arrears.

These are welcome changes and combined are likely to relieve some of the difficulties tenants and housing associations have faced since the start of the Universal Credit roll-out.

We will continue to work with our members and the Government to better understand how Universal Credit can be further improved for people on low incomes.

Voluntary Right to Buy

The Budget has confirmed the Government’s intention to proceed with a large-scale regional pilot of the Voluntary Right to Buy (VRTB) scheme in the Midlands.

A pilot in the Midlands, where there is a range of different housing markets, will provide valuable learning ahead of a roll-out of a national scheme.

We are keen to explore how untried elements of VRTB will operate, including portability and one-for-one replacement. These are critical pillars of the original agreement and are vital in boosting the nation’s housing supply.

We will work closely with members across the pilot area as more detail emerges, building on the learning from the original pilot, which highlighted the sector’s ability to collaborate with the Government and deliver for tenants.

Government housing programme

The Chancellor also announced details of the Government’s housing programme, which includes £15.3bn of new investment and support. This consists of:

  • Confirmation of an extra £2bn investment in affordable housing, including for social rented homes
  • £1.1bn for a new Land Assembly Fund
  • An extra £2.7bn for the Housing Infrastructure Fund
  • A further £630m for infrastructure and remediation on small sites
  • A further £1.5bn for the Home Building Fund targeted at SMEs
  • The creation of £8bn worth of new guarantees to support a range of housebuilding
  • Up to £1bn more HRA headroom for councils in high demand areas. 

In addition to extra investment and support, the Chancellor indicated a renewed focus on ensuring the planning system is supporting the delivery of the new homes we need. Planning reform is crucial to delivering the necessary step change in supply and we will be analysing the proposals in detail as well as engaging proactively with the consultations and reviews announced.

Taken together, today’s package of measures are a good signal of intent from the Chancellor. However, for a budget that had been trailed as ‘the housing budget’, today’s announcement fell short on the measures needed if the country is going to reach the Government’s target of 300,000 new homes each year.

It had been confirmed before today’s announcement that we had secured much of what we were calling for in our Budget 2017 submission – the rent settlement from 2020, an additional £2bn for affordable housing, and the scrapping of the LHA cap. However, there was nothing in this statement about the Government taking action on increasing access to land, which is needed if we are going to significantly increase supply.