Cladding group blasts government ‘magic money tree’ over £8.6bn homes fund

Ministers have hailed the “largest single investment in affordable housing in a decade” with the promise of more than 100,000 new homes in England. But cladding crisis campaigners have accused the government of finding the “magic money tree” while leaving leaseholders facing soaring bills to fix fire defects in their homes.

Some 119,000 homes will be delivered under their £8.6bn Affordable Homes Programme, with 57,000 set aside for home ownership, 29,600 for social rent and a further 6,250 affordable rural homes.

The investment has angered leaseholders who have been demanding the government pay bills to fix fire defects in their homes, said UK Cladding Action Group’s Ritu Saha.

“It is disappointing,” said the Bromley leaseholder. “The magic money tree is there when the government wants it to exist. Some of these developers and housing associations are forcing leaseholders to pay 100 per cent of the cost of fixing these buildings and the same firms are going to get £8.6 billion of taxpayer funding to do more of the same. Where’s the accountability? Where’s the justice for leaseholders? It’s really shocking.

“Nobody is denying that the country needs more homes. But the point is that by refusing to make the existing homes safe, the government is actually putting a huge chunk of these properties out of circulation.”

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The Big Issue’s Stop Mass Homelessness campaign is calling on the government to increase social housing stock as part of its nine-point plan to tackle an oncoming homelessness crisis in the months ahead.

Just 6,566 social rent homes were built in England between March 2019 and April 2020, according to official government statistics, despite long-standing pleas from charities and campaigners for more following years of neglect.

But housing experts have warned the scheme has little chance in delivering the homes the country desperately needs. The Local Government Association has previously said 100,000 social rent homes are needed annually to meet demand for the most affordable form of housing.

Polly Neate, chief executive of Shelter, said the announcement represented a “lightbulb moment for social housing” but said “more ambition” is needed to solve the housing emergency. Neate added: “The government has recognised that social housing is the answer – so they now need to invest more and get it built.”

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Housing expert Tom Murtha, a part of social housing organisation Shout, also said the impact of the programme, which runs until 2026, could be limited by the loss of social homes through Right to Buy, demolitions and sell-offs.

“So it’s not even adding to the current stock of social rent homes,” said Murtha. “My simple answer is it’s a small increase in what the government’s been giving in the last two or three years, but it’s nowhere near enough to meet the demand that everyone recognises is there.”

“Both governments in Scotland and Wales have stopped the Right to Buy so clearly their priority is social rent and meeting the needs of those that are homeless and others. That’s not the priority of the government in England.”

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Renting union Acorn told The Big Issue that homes built under the affordable homes banner remain out of reach for many. Affordable housing can include starter homes, shared ownership but not all are priced at 20 per cent below local market value as social rent homes are intended. As a result, the Affordable Housing Commission concluded last year that many “are clearly unaffordable to those on mid to lower incomes.”

“Affordable housing is all well and good, but we have repeatedly seen that the government’s definition of affordable does not match with reality,” said an ACORN spokesperson. “The government can’t pretend that they are taking the affordability crisis seriously when they are continually doing their best to inflate the housing market and ignoring renters.”

However, the government has promoted the economic merits of the programme as well as tackling the housing crisis, claiming housebuilding efforts would generate £26bn in private and public investments as well as supporting up to 370,000 jobs across the country.

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Almost £5.2bn of the fund will be delivered outside London by government body Homes England. The Greater London Authority (GLA) will deliver homes in London.

London mayor Sadiq Khan announced almost 30,000 homes would be built in London with the £3.46bn investment over the next five years. However, Khan has boasted that almost 60 per cent of homes in the programme will be for social rent.

“Creating more opportunities for home ownership is central to this government,” said housing secretary Robert Jenrick. 

“This huge funding package will make the ambition of owning a home a reality for families by making it realistic and affordable.

“We are also ensuring tens of thousands of new homes for rent are built in the years ahead, including social rent, so those on the lowest incomes can enjoy good quality, secure rented homes, built and managed by reputable providers.”

Hundreds of thousands of people are at risk of losing their homes right now. One UK household is being made homeless every three-and-a-half hours.

You can help stop a potential avalanche of homelessness by joining The Big Issue’s Stop Mass Homelessness campaign. Here’s how:

• Read our nine-point plan to Stop Mass Homelessness
• Sign the petition to add your voice to our campaign to Stop Mass Homelessness
• Join the conversation and share your support using the hashtag #StopMassHomelessness