POLICY DEVELOPMENTS IN OTHER PARTS OF THE UK
UK
Budget concessions on Universal Credit
Chancellor Philip Hammond announced a series of changes to Universal Credit in his Autumn Budget, including the scrapping of the seven-day waiting period, making advances easier to get and allowing continued payment of housing benefit for two weeks after a universal credit claim. There was also another delay to the roll-out.
However, the chancellor turned down pleas for a lifting of the benefit freeze, which means that Local Housing Allowance for private tenants will stay the same until 2020 regardless of what happens to rents.
Instead he extended the Targeted Affordability Fund for areas of high rent pressure with funding worth £430m by 2022/23.
The Budget also confirmed the u-turn on the LHA cap for social and supported housing announced shortly after the October issue of WHQ went to press.
See welfare reform feature
McVey returns to DWP
Esther McVey succeeded David Gauke as work and pensions secretary in a January reshuffle of the Cabinet at Westminster.
As a minister of state at the DWP between 2013 and 2015 she was a strong defender of the bedroom tax. She lost her seat at the 2015 general election before returning to parliament in 2017.
ENGLAND
Stamp duty eliminated for first-time buyers
The big announcement for England in the Budget was the abolition of stamp duty on purchases worth up to £300,000 (or the first £300,000 of homes worth up to £500,000) by first- time buyers.
This was presented as part of Theresa May’s drive to restore the ‘dream of home ownership’ and ministers argued it would mean 95 per cent of first-time buyers would pay no stamp duty.
Critics argued it would inflate house prices and benefit people who could have afforded to buy anyway.
Elsewhere in the Budget, the chancellor confirmed the extra £2 billion for affordable homes promised by the prime minister in her Conservative conference speech in October but the small print revealed that it would come from reallocating money previously allocated to starter homes and other programmes.
Fire safety culture must change, says review
Fire safety regulations are ‘not fit for purpose’ and guidance is ‘complex and unclear’, according to the interim findings of an independent review of the building regulations and safety set up in the wake of the Grenfell Tower fire.
The review chaired by Dame Judith Hackitt called for ‘action by the entire industry and the parts of government that oversee it’ and for a ‘universal shift in culture’.
The interim findings did not make specific recommendations, for example on sprinklers, but set a ‘direction of travel’ for the final report.
Housing sees ups and downs of reshuffle
England has a full Cabinet minister with housing in their title for the first time in almost 50 years following the reshuffle in January.
Sajid Javid remains as secretary of state but of the Ministry of Housing, Communities and Local Government rather than the Department for Communities and Local Government.
The rebranding was intended as a signal that the UK government is treating the issue with the same importance as it enjoyed in the 1950s and 1960s.
However, no sooner was the new name confirmed than Alok Sharma, the housing minister, was reshuffled after just seven months in the job.
Appointed just before the Grenfell Tower re, he had spent much of his time listening to tenants ahead of a social housing green paper.
Sharma, who becomes a work and pensions minister, was replaced by prominent Brexiteer Dominic Raab.
SCOTLAND
Government increases affordable housing budget
The Scottish Government announced a 28 per cent increase in its Affordable Housing Supply Programme for 2018/19 in its Draft Budget in December.
Some £523 million of the money, 70 per cent of the total, is capital funding mainly for new social housing, an increase of £147 million on 2017/18.
Holyrood said spend per head through the Affordable Housing Supply Programme is more than three times higher than in England, at £555 compared to £165.
The Draft Budget also introduced a new relief on Land and Building Transaction Tax (LBTT) for first-time buyers of homes bought for up to £175,000. The Scottish Government said that would mean 80 per cent of first-time buyers would be taken out of LBTT altogether.
NORTHERN IRELAND
Watchdog criticises approach to homelessness
The Northern Ireland Housing Executive’s strategy to reduce homelessness has had ‘limited success’, according to the government’s financial watchdog.
The Northern Ireland Audit Office said homelessness had cost the public purse £300 million between 2012 and 2017 and statutory homelessness had increased by 32 per cent to affect almost 12,000 households in 2016/17.
The report said the NIHE was unable to fully demonstrate the impact of its work in reducing homelessness.
Problems included weaknesses in analysis, interpretation and presentation of data, with a lack of evidence as to why statutory homeless acceptance rates are higher than in other UK jurisdictions.
WELSH GOVERNMENT
Right to Buy Bill approved
The Bill abolishing the Right to Buy in Wales gained final approval in the National Assembly in December, paving the way for it to go forward for Royal Assent.
The Abolition of the Right to Buy and Associated Rights (Wales) Bill was introduced in March with the aim of protecting the stock of social housing.
The legislation allows at least one year after Royal Assent before final abolition on existing properties. However, to encourage investment in new homes, the rights will end for homes that are new to the social housing stock, and therefore have no existing tenants, two months after Royal Assent.
Housing and regeneration minister Rebecca Evans welcomed a measure that she said would ‘safeguard the investment made in social housing over many generations’ and give social landlords the confidence to invest in new homes.
She also paid tribute to her predecessor: ‘I would also like to say how pleased Carl Sargeant would have been to see the Bill reach this final stage. He believed passionately in protecting our social housing stock for those who need it most and worked extremely hard to bring this legislation forward. I am delighted to be able to help steer it through its final stages and on to the Welsh Statute book.’
See feature, Remembering Carl Sargeant
Minister welcomes 6% rise in affordable homes
Local authorities reported a 6 per cent increase in affordable housing provision in 2016/17 with 2,547 homes delivered across Wales.
Housing associations delivered 93 per cent of these (2,378 homes), which was also an increase of 6 per cent.
Local authorities delivered 5 per cent (121 social rented homes) while the other 2 per cent came from other providers, including low-cost home ownership homes delivered by local authorities via section 106 agreements.
Overall, the number of affordable homes delivered with capital grant funding increased by 3 per cent to 1,810 while the number delivered without grant rose 16 per cent.
Some 689 of the homes were built on public land, a decrease of a fifth on 2015/16.
Land transaction tax threshold raised
Buyers of homes in Wales worth up to £180,000 will pay no tax once Land Transaction Tax starts in April, finance secretary Mark Drakeford announced in December.
The increase on the previous threshold of £150,000 came in the wake of England’s abolition of stamp duty for first-time buyers on homes worth up to £300,000.
The increased thresholds in the new devolved Welsh tax will apply to anyone buying a home, including first- time buyers.
Welsh Government said the changes would mean:
- No one will pay more than under the rates announced in the Draft Budget in October
- The average buyer in Wales will pay more than £500 less tax than under stamp duty land tax
- 90 per cent of buyers in Wales will either pay the same or less tax than under stamp duty land tax
- around 80 per cent of first-time buyers in Wales will pay no tax – the same proportion which will benefit from the chancellor’s first-time buyer stamp duty land tax relief in England.
Watchdog urges action on homelessness prevention
More work is needed to prevent homelessness despite good progress so far, says the Wales Audit Office (WAO).
A report by the financial watchdog says that much of what causes homelessness is outside the control of councils and Welsh Government and is influenced by decisions at Westminster.
However, it says local authorities can do more to improve their services and found considerable variation in how councils are responding to their new prevention duties in the Housing (Wales) Act.
The WAO also found that, while Welsh Government grant funding had supported local authorities to implement their new duties, overall funding on homelessness and housing advice services has fallen in real terms.
And while national data shows successes in preventing homelessness, the WAO says ‘the levels of successful prevention work is beginning to decline and the numbers threatened with homelessness and requiring temporary accommodation are growing’.
Final Budget due
All eyes were on the Supporting People budget as the National Assembly prepared to vote on the Final Budget for 2018/19 as WHQ went to press.
The budget has been ringfenced until now but in October Welsh Government set out plans for Flexible Funding Pathfinders under which seven local authorities would have 100 per cent spending flexibility over ten funding programmes next year including Supporting People, Homelessness Prevention and other non-housing programmes.
In the same month, the Draft Budget was published with no distinct budget line for Supporting People for 2019/20. Ministers said no decisions had been made but critics argued this was a breach of the budget deal between Welsh Government and Plaid Cymru that protected funding for two years.
Cymorth Cymru was contacting AMs ahead of the vote to express its concerns and highlight evidence of what happened in England when the ringfence was removed.
PUBLICATIONS 8 TO LOOK OUT FOR
1) Evaluation of Extra Care Housing in Wales
Sheffield Hallam University for Welsh Government, October 2017
www4.shu.ac.uk/research/cresr/sites/shu.ac.uk/files/eval-extra-care-housing-wales.pdf
2) Ending Rough Sleeping: What Works? An international evidence review
Crisis, December 2017
3) After Brexit: housing the nation
Bevan Foundation with Community Housing Cymru, December 2017
www.bevanfoundation.org/publications/brexit-housing-nation/
4) UK Poverty 2017
Joseph Rowntree Foundation, December 2017
www.jrf.org.uk/report/uk-poverty-2017
5) Room to improve: The role of home adaptations in improving later life
Centre for Ageing Better, November 2017
www.ageing-better.org.uk/publications/room-improve-role-home-adaptations-improving-later-life
6) Local authority direct provision of housing
University College London for Royal Town Planning Institute, December 2017
www.rtpi.org.uk/media/2619006/Local-authority-direct-provision-of-housing.pdf
7) The Land Question: fixing the dysfunction at the root of the housing crisis
Civitas, November 2017
civitas.org.uk/publications/the-land-question/
8) Priced Out: Affordable Housing in England
Institute for Public Policy Research, November 2017