The investment, which had been reported widely yesterday ahead of the Spending Review, is the “biggest cash injection” into social and affordable housing for around 50 years, Chancellor Rachel Reeves said in her statement today.
She continued on to say that this would be “direct government funding to support housebuilding, especially for social rent”.
Reeves added that Blackpool, Preston, Sheffield and Swindon already have plans to bring forward bids to build homes in their communities.
“Our planning reforms have opened up the opportunity to build; now we must act to make the most of those opportunities, and a plan to match the scale of the housing crisis must include social housing, which has been neglected for too many decades, but not by this Labour government and so… we are taking action,” she said.
In documents, the investment in social and affordable housing will reach £4bn per year in 2029-30.
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The government will also be providing £950m of investment in the fourth round of the Local Authority Housing Fund, which is the largest investment in the fund to date, so local authorities in England can “increase the supply of good-quality temporary accommodation and drive down the use of costly bed and breakfasts and hotels”.
It comes after Reeves confirmed that the government would end the use of hotels to house asylum seekers in the Spending Review.
Govt to allow greater financial investment in housebuilding
Reeves continued on to say that the government would be catalysing additional private investment to boost housebuilding, so its envelope of financial transactions has been increased to £9.6bn over the Spending Review period.
Financial transactions allow the government to invest alongside the private sector through equity investments, loans and guarantees.
She said: “Last autumn, I enabled greater use of financial transactions to support investments in our infrastructure, alongside strict guard rails that ensure that money is spent wisely through our public financial institutions.
“So, in line with that commitment, I am providing an additional £10bn for financial investments, including to be delivered through Homes England, to crowd in private investment and unlock hundreds of thousands more homes.”
In Spending Review documents, the Treasury confirmed £4.8bn in financial transactions from 2026-27 to 2029-30 to boost housebuilding.
