Government to cut Right to Buy discounts at Budget to boost council housing

26 October 2024, 00:38 | Updated: 26 October 2024, 07:28

Mortgage Rates Affected By Latest Interest Rate Rise
The government has unveiled a major housing package . Picture: Getty

By Flaminia Luck

The government has unveiled a major housing package aimed at tackling the shortage of affordable homes and boosting social housing availability.

Listen to this article

Loading audio...

The Budget will reportedly deliver more affordable housing, ensure social housing is available for those who need it and turbocharge the delivery of 1.5 million homes as the Chancellor commits to rebuilding Britain.

The housing package announced on Saturday will deliver up to 5,000 new affordable social homes with £500 million in new funding for the Affordable Homes Programme - bringing total investment in housing supply to over £5 billion - and supporting the delivery of 33,000 new homes through £128 million for housing projects across the country.   

Meanwhile, the stock of social housing will supposedly be increased through a new five-year social housing rent settlement that will give the sector more long-term certainty on funding and allow them to invest in tens of thousands of new homes.

The existing stock will also be protected by reducing Right to Buy discounts so that thousands more council homes remain in the sector.

Labour Party Conference 2024 - Day Two
Rachel Reeves said: “We need to fix the housing crisis in this country". Picture: Getty

Chancellor of the Exchequer, Rachel Reeves said: “We need to fix the housing crisis in this country.

"It’s created a generation locked out of the property market, torn apart communities and put the brakes on economic growth.

“We are rebuilding Britain by ramping up housebuilding and delivering the 1.5 million new homes we so badly need”.

UK housing, Folkestone, Kent.
UK housing, Folkestone, Kent. Picture: Alamy

'Broken'

Deputy Prime Minister Angela Rayner said: “We have inherited a housing system which is broken, with not enough homes being built and even fewer that families can afford.

“This is a further significant step in our plan to get Britain building again, backing the sector, so they can help us deliver a social and affordable housing boom, supporting millions of people up and down the country into a safe, affordable and decent home they can be proud of.

”The £500 million to deliver thousands of new social and affordable homes is a top-up to the existing Affordable Homes Programme and comes ahead of the Government’s Housing Strategy due in the Spring."

Leeds Social housing, UK
Leeds Social housing, UK. Picture: Alamy

The Government will set out details of new investment to succeed the 2021-26 Affordable Homes Programme at the Spending Review.

This will lay the foundations for the manifesto commitment to deliver the biggest increase in social and affordable housebuilding in a generation, and to support councils and housing associations to build their capacity and make a greater contribution to affordable housing supply.

It will deliver a mix of homes for sub-market rent and home-ownership, with a particular focus on delivering homes for Social Rent.

The Government will also consult on a new 5-year social housing rent settlement, which caps the rents social housing providers can charge their tenants, to provide the sector with the certainty it needs to invest in new social housing.

Read more: Rape crisis service cuts ties with charity amid row over single-sex services

Read more: 'You brought so much joy': Nicole Scherzinger and Naomi Campbell pay tribute to Liam Payne

The intention would be for this to increase with Consumer Price Index inflation figures and an additional 1%.

The consultation will also seek views on other potential options to give greater certainty, such as providing a 10-year settlement.

These measures to increase affordable housing come alongside changes to the Right to Buy scheme, which will protect existing social housing stock to meet housing need and deliver a fairer and more sustainable scheme.

England’s existing social housing supply is depleted every year by the scheme while also disincentivising councils to build new social housing.

aerial view of housing estate, North Berwick, East Lothian, Scotland, Uk
aerial view of housing estate, North Berwick, East Lothian, Scotland, Uk. Picture: Alamy

Discounts will be reduced alongside greater protections for newly-built social housing and councils will be able to keep 100% of the receipts generated by a Right to Buy sale.

This will enable councils to scale-up delivery of much needed social housing whilst still enabling longstanding tenants to buy their own homes.

The £128 million will support the delivery of new housing projects – including up to 28,000 new builds currently blocked by river pollution – cleaning up our rivers in the process - 3,000 energy efficient homes across the country and 2,000 new homes in North Liverpool.Meanwhile the £56 million investment at Liverpool Central Docks will also deliver office, retail, leisure and hotel facilities alongside the new homes.

As well as demonstrating our brownfield-first approach, it will transform Liverpool’s former docklands into a thriving waterfront neighbourhood. 

Kate Henderson, Chief Executive of the National Housing Federation, says:"We strongly welcome the £500m top-up to the affordable homes programme. This vital injection of funding, which we’ve been urgently calling for, will support housing associations to continue to deliver much needed affordable homes in the immediate term and prevent a collapse in delivery.

"We share the government’s ambition to build 1.5million homes over this parliament and stand ready to deliver the social homes needed, which is why we welcome a consultation on a new rent settlement.  This will provide both transparency for residents and long term certainty and financial stability for social housing providers. We also support the government's decision to review right to buy discounts.

"To achieve the affordable homes needed across the country, alongside this short term top-up, we look forward to a new long term housing strategy announced at the next spending review, including a significant boost in funding for social housing."

More Latest News

See more More Latest News

The Home Secretary has previously written to tech giants including X, Meta, TikTok and Google calling for them to remove harmful content or ‘risk a second Southport’.

‘A total disgrace’ that extreme content viewed by Southport killer still on social media, says Yvette Cooper

x

Raid on abattoir leads to human trafficking arrests

It was the third time Giorgia Meloni's far-right government tried and failed to process migrants in the non-EU country.

Meloni’s offshore migrant detention scheme fails for third time as Italy forced to take back asylum seekers

m

Killer nurse Lucy Letby's legal team to announce 'new medical evidence' from panel of experts

Barclays logo high street bank sign outside branch of Barclays bank in the Shropshire town of Ludlow, England

Barclays apologises for IT glitch that 'left people homeless' and says services are back to normal

A 61-year-old man has been arrested on suspicion of the murder of Lamduan Armitage in 2004

Man, 61, arrested over 2004 death of Thai woman found dead in stream in Yorkshire Dales

The man hit the waitress with a plate. Picture: Social media

Man arrested after Nando's worker slapped in face with plate by customer

A man uses a cash point machine outside a branch of Barclays...

Barclays customers facing third day of problems due to ongoing IT issue

President Trump Signs Executive Orders In The Oval Office

Trump risks trade war as China, Canada and Mexico vow to respond to string of trade tariffs

Ukrainian President Volodymyr Zelenskyy, right, shakes hands with U.S president-elect Donald Trump, left, before a bilateral meeting at the Elysee Palace, December 7, 2024 in Paris, France.

US wants Ukraine to hold elections after potential ceasefire with Russia, Trump envoy says

The plans were announced by Home Secretary Yvette Cooper

Owning AI tech to create child sex abuse images to become criminal offence as reports of depraved pictures soar

A man and a woman have been arrested after two young children died in a crash in Essex on Saturday evening.

Man and woman arrested over death of young boy and girl after ‘hit and run’ crash

General view of a Barclays bank in Moorgate as reports state...

Barclays tells customers to go to friends, family or food banks after people left ‘homeless’ amid IT glitch

London, England, 1st Feb 2025.  Tens of thousands of the far right converged around Whitehall this weekend to protest against the incarceration of Tommy Robinson who has been in isolation in HMP Woodhill for over 13 weeks.

Six arrests made as thousands of Tommy Robinson supporters march through London

Trump says US airstrikes 'killed many' ISIS terrorists

'We will find you and we will kill you' - Trump says US airstrikes have 'killed many' ISIS terrorists hiding in caves

Four people died after a car crashed into a building in Colchester city centre.

Four people dead after car crashed into city centre building in ‘serious collision’ in Colchester