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03 May 2013

£400m funding boost for affordable homes in Wales by 2016 - Jane Hutt

Press release from Welsh Government:

A £400m funding boost to increase the supply of housing in Wales will help realise the Welsh Government’s ambitious plans to deliver 7,500 new affordable homes by 2016, Finance Minister Jane Hutt announced today (Friday 3 May).

Despite UK Government budget cuts, since 2011 the Welsh Government has taken a number of major steps to boost investment in affordable housing.

Along with the private finance that these initiatives facilitate, the Welsh Government’s contribution will total around £160m, and includes:

  • In 2011/12 £18.1m extra allocated to boost the supply of social housing and £3m extra for physical adaptation and disabled facilities grants.
  • In 2012/13 £29m extra allocated to boost the supply of social housing – delivering 464 new affordable homes, £1m extra for Independent Living Grants, £5m extra for the West Rhyl housing project, and £10m in 2012/13 for the new Houses into Homes initiative to bring empty properties back in to use – this has already brought at least 450 houses back in to use with the first wave of interest-free loans.
  • In 2013/14 and 2014/15 £16.7m extra to enable use of public sector land for housing, building on the Ely Mill model.
  • The Welsh Housing Partnership, which enables four Registered Social Landlords to use Welsh Government funding to lever investment by the Principality Building Society to provide affordable rental housing across Wales. The Welsh Government will be investing £21m between 2010/11 and 2014/15 in this initiative, supporting a total investment of over £100m, delivering up to 900 homes.

The Minister today announced plans are being finalised for a new innovative mechanism for financing social housing – which will enable investment of up to £140m over the next few years to deliver around 1,100 new homes.

The Minister will announce further capital funding allocations across a number of sectors next week.

Addressing a housing finance conference in Wrexham, Finance Minister Jane Hutt said:

“Due to the UK Government’s economic policies, the UK economy has hardly grown since 2011 and remains smaller than it was in 2008. Growth prospects for Wales are likely to remain subdued for some time to come.

“The combination of changes in the banking sector, falling Government capital budgets, welfare reform and the wider economic malaise has been particularly challenging for the social housing sector over the last few years.

“As a Welsh Government, we are determined to use the tools currently at our disposal to support the housing sector in Wales by boosting the supply of affordable housing in tough times.”

The Minister said the Welsh Government is responding to these challenges through the Wales Infrastructure Investment Plan. Published a year ago and regularly refreshed, the Plan aims to sharpen our prioritisation, improve investment planning and boost the resources available for infrastructure investment to the benefit of the Welsh public & private sectors.

Jane Hutt added:

“The £400m extra investment in housing is already delivering real results. It will help ensure we meet our ambitious target of creating 7,500 new affordable homes by 2016 – while also boosting growth and creating jobs & training opportunities.

“Every time we invest in housing we are also investing in jobs, skills, and communities at a time when tackling poverty and creating jobs is at the top of the Welsh Government’s agenda.

“Attracting finance through more traditional means has become a significant challenge in today’s economy. That’s why we are committed to finding innovative ways to make our available funding go further.

“The tax regime in the property sector is also a key issue. Last week and this week I have been meeting with leading home builders, businesses, and other representatives of the construction and property industries. I want to hear their views on the current operation of Stamp Duty Land Tax, and the potential for reform when this tax is devolved."