Chancellor Rachel Reeves unveiled her Autumn Budget last Wednesday, among the announcements contained within it were measures to boost growth, additional funding to tackle fuel poverty and investment to create hundreds of new planners, however, there was no mention of funding for supported housing, the decision on rent convergence was delayed to the New Year and ECO scheme cut. Here we share opinion from across the social and affordable housing sector, public sector and construction industry.
Measures to boost growth in the capital welcome, but further policy action needed to support London Borough’s facing town hall finances
Cllr Claire Holland, Chair of London Councils, said: “London is a crucial part of the UK economic engine and we welcome the measures announced that will help us boost growth in the capital and contribute to national prosperity.
“Government investment in transport infrastructure is essential for accelerating growth in London and supporting the delivery of new housing. We have consistently made the case for the DLR extension to Thamesmead, along with the Mayor of London and business leaders. We are pleased to see the Chancellor backing delivery of this vital project, which will help unlock thousands of new homes and jobs.
“Greater fiscal devolution and local empowerment is critical to addressing the crisis in council finances and stalled growth. We welcome confirmation that London will be able to introduce an overnight accommodation levy. This is something we have long called for and we look forward to working with the Government and the Mayor on the design and implementation of the levy, in order to ensure this is a success for Londoners and our tourist industry.
“It is vital that a fair portion of the revenue raised from any levy is retained locally by boroughs, so those parts of the capital experiencing high volumes of tourism have the resources they need to invest back into their area in order to manage pressure on services and support growth, with the remaining funds invested across the capital to support pan-London services and local growth opportunities.
“We have repeatedly called for reform of the council tax system, but this must be done in a way that gives local authorities more freedoms and flexibilities rather than fewer, and maintains the principle that revenues raised locally are retained locally. We will be looking at the Government’s proposal for a council tax surcharge on higher value properties in more detail and will continue to make the case for an approach that is fair and empowers local authorities.
“In the face of the urgent challenges for London’s economy and town hall finances — particularly housing and homelessness pressures — we know that further policy action is needed at a national level. We will keep working with the Government to restore stability to budgets, sustain local services, and help drive growth in our communities.”
Welcome steps towards tackling cost-of-living crisis, but lack of funding for supported housing disappointing
Kate Henderson, Chief Executive of the National Housing Federation commented: “The Budget contains welcome steps to tackle the cost-of-living crisis, with removal of the two-child benefit cap— which we have long been calling for — set to lift thousands of families out of poverty.
“We had expected the Government to announce how rent convergence, which equalises historical differences in rents over time, will be reintroduced. This policy is both fair for tenants and vital in ensuring the social housing sector has enough income to maintain existing homes and build new ones. However, this decision has now been delayed. We look forward to hearing the Government’s decision on this in January, which will enable housing associations to put in strong bids for funding through the Social and Affordable Homes Programme and deliver on the Government’s housebuilding ambitions.
“It’s positive to see an additional £1.5bn to tackle fuel poverty through the Warm Homes Plan and we look forward to seeing the detail on this. However, it is disappointing not to see any funding announced for supported housing, with many schemes closing across the country due to years of cuts and rising costs. We will work with the Government to protect this vital resource.
“Housing associations remain committed to delivering a decade of renewal for social and affordable housing.”
Support for households facing fuel poverty welcome, however announcements on rent convergence and support for struggling sectors such as supported housing missing
Gavin Smart, Chartered Institute of Housing chief executive, said: “The Budget contains welcome steps to tackle the cost-of-living challenge, with the removal of the two-child limit — which CIH has long called for — set to lift thousands of families out of poverty. This is an important milestone and a clear signal of the government’s commitment to supporting those facing the greatest hardship.
“However, without changes to the benefit cap and local housing allowance (LHA), too many families will still struggle to afford their rent or meet basic living costs. The benefit cap continues to restrict support for households most in need, while frozen LHA rates leave renters facing unmanageable shortfalls. Without action, these pressures risk undermining the positive impact of ending the two-child limit and could leave families facing rising arrears, overcrowding, and homelessness.
“With the need to boost supply more urgent than ever, we had hoped the government would confirm how social rent convergence will be reintroduced. We are pleased, however, to see a renewed commitment to this policy, as set out at the Spending Review. Rent convergence is vital to ensuring social landlords have the income required to maintain existing homes and build much-needed new ones. Delaying final confirmation until January creates uncertainty for providers already working to tight statutory rent-setting timelines and risks slowing progress.
“Clarity early in the new year — with a level set that enables meaningful convergence — will allow providers to plan confidently and bid into the Social and Affordable Homes Programme, supporting the government’s wider housebuilding ambitions.
“A significant missed opportunity in today’s Budget is the lack of support for critical supported housing schemes, which are becoming increasingly difficult to sustain. These services provide vital support to some of the most vulnerable people and prevent far higher costs falling on health, social care, and the justice system. Targeted investment would protect a sector that is essential to both prevention and long-term public service efficiency.
“On energy, we welcome the Chancellor’s recognition that direct action was needed to reduce bills after years of persistently high costs that have forced many into impossible choices. However, cutting billions of pounds previously allocated to making homes permanently warmer risks weakening the long-term solution to fuel poverty and putting supply chains and jobs at risk.
“We now need the government to publish its Warm Homes Plan, setting out how the £14.7bn in capital funding will be allocated, confirming future energy efficiency standards in both rented sectors, and taking further steps to make clean heating more affordable.
“In summary, we welcome the Government’s recognition that affordable housing plays a central role in tackling the cost-of-living crisis. But new homes take time to deliver, and action is needed now. Strengthening the social security system, supporting essential supported housing, and providing long-term certainty for social landlords must all be part of a comprehensive approach to reduce poverty, improve affordability, and sustain a resilient housing sector.”
Chancellor right to focus on cost of living
Jonathan Layzell, Chief Executive at Stonewater, commented: “The Chancellor has rightly focused this Budget on tackling the cost of living. It is the necessary precursor to improving economic growth.
“So often that growth begins at home, and we need to build many more. The announcement of £48m for 350 new planners is a welcome step to unblock the system.
“Taken with the £39bn Social and Affordable Homes Programme announced earlier this year, the sector is well positioned to support the Government’s target of 1.5 million new homes.
“However, we would have liked to have seen the Warm Homes Plan published, as we know energy prices are one of the key factors impacting the cost of living for households across the country.
“We urge the Government to prioritise publishing the Warm Homes Plan as soon as possible, and to provide a long-term funding commitment of at least ten years. This stability is essential to unlock the supply chain investment needed for a sustainable, large-scale retrofit programme — one that cuts energy bills and eases pressure on the NHS by preventing illnesses caused by poor-quality homes.
“Stability in funding is vital. Not only does it allow us to build more homes, but it also helps us support existing customers feeling the strain of the economic climate.
“We also need to make sure investment reaches every community. Clear mechanisms are vital to address the housing crisis in rural areas, where the need is acute and delivery costs are high. We continue to ask the Treasury to ringfence a proportion of the Social and Affordable Homes Programme funding for rural locations where existing large-scale models simply do not work.
“Stonewater stands ready to work with the government to deliver these critical priorities. Success hinges on translating broad funding pledges into targeted, practical policy action.”
Commitment to tackling the UK’s housing crisis
Phil Andrew, Orbit Group Chief Executive said: “Given the positive housing measures announced in the Spending Review, it came as no surprise that the budget focused on driving other areas of economic growth. However, we remain confident in the Government’s continued commitment to tackling the UK’s housing crisis. Whilst it’s a positive sign that the OBR predicts that net additions will rise sharply in 2029-30, it’s also a firm reminder that making an impactful difference will take perseverance and time. We must continue to work together to deliver much-needed homes over the long term. At Orbit, we remain committed to playing our part, having recently increased our new-build and regeneration commitment to 7,000 homes by 2030, an increase of over 20%.”
We’ll keep making the case for rent convergence at £3 to make social housing financially sustainable
Andy Hulme, Chief Executive of The Hyde Group, commented: “We warmly welcome the decision to end the two-child benefit cap. This is the right thing to do at a time when more than 4.5m children are estimated to be living in poverty and 1.6m children are affected by the two-child benefit cap.
“We have published research highlighting that England’s 4.3 million social homes provided at least £87bn last year of benefits to the economy, including £18.5bn in savings to the NHS.
“Ahead of the decision on rent convergence in January, we will keep making the case for the value that social housing unlocks for society and the economy to underline the need to make social housing more financially sustainable as the government seeks to build 180,000 social rent homes over the next decade.
“Successive caps and cuts have reduced rents for social homes by 15% over the past decade, at a time when investment needs have grown and social landlords are spending record sums on repairs and maintenance. We would have been able to invest more per year in our customers’ homes and services if the standard rent formula had been maintained since 2016.
“The current absence of rent convergence means that rents at around half (45%) of the social homes we provide are below where they should be.
“We will continue to engage with government to advocate for rent convergence to be reintroduced at £3 a week to provide further resources over the next decade to invest in customers’ homes and to help build new affordable homes.
“Re-introducing rent convergence creates fairness for residents and is crucial because, in the long-run, social rent homes across England which do not meet formula rent become financially unsustainable for social housing charities to continue providing.”
Welcome Warm Homes Plan boost — disappointed no funding for supported housing after one in three provides close scheme
Paul Dolan, CEO of Riverside said: “Over the past 15 years child poverty has grown and now almost one in three children are living in relative poverty with 60% of Universal Credit claimants affected by the policy in work. Scrapping the two-child benefit cap will help to prevent homelessness and improve the lives of hundreds of thousands of children by lifting them out of poverty.
“We are pleased to see the financial boost for the Warm Homes Plan which will create warmer, energy efficient homes and improve the health and wellbeing of residents. Riverside has been able to deliver energy efficiency improvements to thousands of homes across the country, and we’re keen to continue this work with government.
“However, we are disappointed that no funding for supported housing has been announced. We are deeply concerned about the perilous state of supported housing and homeless prevention services such as floating support. Last year, one in three supported housing providers had to close schemes because of funding pressures. We are now awaiting the government’s long-term homelessness strategy, and we hope that long-term ring-fenced funding for supported housing is forthcoming to prevent future closures.”
Time to listen to the built environment sector
Allan Wilen, Economics Director at Glenigan, commented: “We all knew the Chancellor needed to ensure the Government’s finances appear on a firm footing, and she made the most of the situation to do so. It is welcome that the Chancellor also reiterated the Government’s commitment to £120bn of capital investment previously set out in the Spending Review. But it’s vital the Government rapidly delivers on these commitments and does not damage already fragile investor confidence, both for the UK construction sector’s survival and to ensure stronger UK productivity and economic growth. That, for me, has to be the primary objective.
“The situation’s pretty serious, as much as it’s been downplayed. Without increased investment, the UK will not secure the economic and productivity growth needed to deliver a rise in living standards and to improve the Government’s own finances over the longer term. There is a danger that the plethora of new taxes announced by the Chancellor may deter private sector investment and frustrate other government objectives.
“The new property tax on higher value homes, whilst targeting the top end of the property market, could have a disproportionately disruptive impact on the wider housing market. This could deter new house construction, especially in parts of the UK such as London, where property prices are highest. This will throw a spanner in the works regarding the Government’s ambitious housing target, especially when there’s an increasing movement of people looking to live in the capital.
“Drawing on what I’ve heard from those at the frontline of UK construction and real estate, Stamp Duty has been repeatedly raised as a distinct blocker to shifting the current stagnation within the property market. For a government looking at all opportunities to balance the books yet deliver a fluid and prosperous residential market, it must be time to listen to the built environment sector and look at some of the current measures that are stifling buying and selling movement in the property market and, in turn, deterring related investment.”
STA disappointed that housing targets not covered in Labour’s Budget announcement
The Structural Timber Association (STA) is disappointed to see that the Labour party’s previous commitment to building 1.5 million new homes was not a focus in the budget announcement made by Chancellor of the Exchequer, Rachel Reeves.
The UK Government is already far behind on its commitments, building just 208,600 homes in the 2024/25 financial year, which was a 6% decrease on the previous year. While it has been stated that the Government would not target annual interim targets, there will need to be a significant increase in the following years. The increased use of structural timber is an effective means of achieving the commitments safely and effectively, with its speed of build and offsite benefits unrivalled by any other building material.
Andrew Orris, CEO of the STA, said: “The housebuilding industry has bolstered its structural timber capacity, building on an already well-positioned industry, however, the Government must drive the increased use of homes built with structural timber if its target of 1.5 million homes by 2029 is to be achieved. As an association and an industry, we believe this should have been a stronger focus within the budget announcement. My question to the Government is how do you plan to achieve this?”
Plan to reduce energy bills welcome
Hamid Salimi, Residential Product Manager at Daikin UK commented: “Daikin welcomes the Government’s plan to reduce energy bills by an average of £150. Bringing down the cost of electricity will undoubtedly ease the cost-of-living crisis. This will make low carbon heating and cooling more affordable and encourage households and businesses to make the switch.”
Energy Company Obligation move disappointing
Jeff House, Director of External Affairs and Policy at Baxi, said: “The ending of the Energy Company Obligation (ECO) is a disappointing move as it currently represents a significant proportion of the annual heat pump market. We acknowledge that there will be additional funding deployed through the Warm Homes Plan to address fuel poor housing. But £1.5bn over three years is a reduction compared to ECO’s £1.7bn a year. We await with interest the Warm Homes Plan which we hope offers further clarity.”
