Finding the money to Build Britain’s Future

So where’s the money coming from for the Building Britain’s Future policies announced today?

The government says that some PFI contracts got cheaper recently… money had been set aside thinking the poor economic climate would stay poor, but it wasn’t needed. There’s also been a raid on some departments’ “underspends”.

But on the biggest spend – the £1.5bn to boost social housing – the biggest loser is the Department of Communities and Local Government itself.

Around £750mn is coming from “reprioritising” its own budget. Within that £750mn around £500mn is coming from the Homes and Communities Agency.

It was formed last year, the DCLG’s website explains, to:

“join up the delivery of housing and regeneration under one roof, bringing together the functions of English Partnerships, the investment functions of the Housing Corporation, the Academy for Sustainable Communities, and key housing and regeneration programmes previously delivered by Communities and Local Government, including the Thames Gateway, Housing Market Renewal, Decent Homes.”

Very similar work to the sort of thing the government is promoting today. The Tories will be studying this one very closely to see what lessons it has for raiding government budgets.

Another interesting development in today’s housing announcements might be the quiet rebirth of council housing. Well, maybe.

The government says it’s interested in letting councils keep 100 per cent of their rent payments – the government has been taking 60-80 per cent of the rents. That could revive a housing sector that was almost dead on its feet.

Only 500 council homes were built last year compared with 50,000 housing association homes. There is some concern that most councils have disbanded the offices and expertise that would allow them to get back in the house building game. There’s a more detailed statement coming on this tomorrow.