The DLUHC has surrended £1.9bn of funding for the housing crisis, roughly a third of the housing budget, after failing to find projects to spend it on
As UK housebuilding continues to stagger in the UK, many will be surprised to hear that £1.9bn of funding for the housing crisis was returned to the Treasury by the Department of Levelling Up, Housing and Communities (DLUHC).
Rising interest rates and post-pandemic housing market uncertainty were identified by the DLUHC as reasons for the lack of successful investment.
The money surrendered was budgeted for 2022-23 and included £255m meant to fund new affordable housing and £245m meant to improve building safety.
A freedom of information request made by government expert Jack Shaw uncovered the initial figures, which were then reported on by the Guardian.
Shaw said: “The government is experiencing significant challenges investing in housing because of a perfect storm in market conditions.
“But the decision to delay housing investment or withdraw it altogether as a result of lower than anticipated spending will mean fewer homes are built.”
Figures indicate significant underspending
The DLUHC underspent by more than £600m on the affordable housing programme in the year, with £363m being “re-profiled” for later years and £1.2bn of money designated for Help to Buy also returned to the Treasury.
It is unclear if this money will be re-invested in affordable housing, as the Help to Buy scheme has now ended, meaning that money cannot be “re-profiled”.
Returning the funding for the housing crisis has been met with severe criticism
Shadow housing secretary Lisa Nandy commented: “The Conservatives have simply given up trying to solve the housing crisis that they helped create.
“Not content with slashing housebuilding by scrapping housing targets, stalling on renters’ reform or rowing back on their promises to leaseholders, ministers are either too incompetent or too out-of-touch to consider it a priority to fix dangerous buildings or build new affordable homes in the middle of a housing crisis.”
But the DLUHC defended their record on housebuilding
A DLUHC spokesperson said: “These are multi-year funding programmes that are being spent flexibly – meaning some money can be moved into future years depending on demand and the wider economic climate.
“We have a strong record on housebuilding – with more than 2 million homes delivered since 2010. Our target of delivering 300,000 homes per year remains and we are fully committed to funding and delivering our programmes that help us meet that target, including the £11.5bn Affordable Homes Programme.”
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