Source · Select Committees · Public Accounts Committee
Recommendation 11
11
Not Addressed
We asked the Department about the number of homes designated for social rent, given social...
Conclusion
We asked the Department about the number of homes designated for social rent, given social rent is the most affordable for tenants; and the type of tenure most needed. We stressed the human impact that a lack of homes for social rent has. A lack of homes forces people to live in hostels or private accommodation in which they move around every few years; leading to children having to move school or travel long distances. The Department commented that it was acutely aware of housing pressures across the country and the associated impact on people, but it said that it must maximise what can be achieved from its available resources. It said that while the 2016 and 2021 programmes were very large capital investments, they alone are not sufficient to completely eliminate the housing pressures faced.28 As part of its 2021 business case, the Department modelled the economic benefits of the Programme compared to costs, by tenure and region.29 The Department told us that getting into the high 2s, 3s, 4s and 5s indicates a very strong benefit-cost ratio and an excellent use of public money.30 Compared to other housing tenures, social rent has the highest benefit cost ratio, at 3.4.31
Government Response Summary
The government acknowledges the need for Social Rent homes and mentions existing policies, but disagrees with the recommendation to assess demand.
Government Response
Not Addressed
HM Government
Not Addressed
3. PAC conclusion: We are concerned that the number of homes being built for social rent is not enough to meet demand. 3. PAC recommendation: The Department should assess how much demand there is for social rent and set out how it will use the Programme to better meet this. 3.1 The government disagrees with the Committee’s recommendation to make an assessment of demand. However, the government will continue to maximise delivery of social rent through a mixed tenure programme. 3.2 The government acknowledges the need for Social Rent homes to support functioning communities, with the right homes in the right places. That was the reason for bringing social rent homes into the scope of the programme in 2018. As the NAO’s report notes, the government already directs the delivery of homes for social rent to unaffordable areas1. The programme’s design incentivises the delivery of social rent homes in areas where they are needed the most through its value for money assessment of bids The government’s recent consultation on national planning policy invites views on how policy can be strengthened to enable local authorities to give greater importance in planning to social rent2. 3.3 The government recognises that there is a demand for homes for social rent across England. However, it is for LAs to assess affordable housing need in their area. In practice, housing developers and LAs often prefer housing developments to include a balance of ownership and rental tenures to promote a mixed tenure community. For this reason, the government believes that the Affordable Homes Programme must continue to support a range of different tenures. 3.4 The government will work with the delivery agencies to confirm the 2021 programme’s capacity to deliver homes for Social Rent as a part of the review cited above in response to recommendation 1. The government will confirm the programme’s ability to deliver an increased proportion of homes for social rent to Parliament at the same time as confirming the programme’s overall delivery targets.