The Housing Corporation announced that housing associations have exceeded Government efficiency targets for the second year. Figures from the annual efficiency statements for 2005/06 show the sector performed well against Government targets. Housing associations delivered on all three categories identified for savings by the Government's 2004 spending review, meaning efficiency gains of £318 million.
With the Corporation's emphasis on efficiency and continuous improvement, the statements represent gains that can be both identified and quantified.
Looking forward, the sector is also predicted to hit all Government targets set for 2006 to 2007. By 2008 the Government expects the sector to deliver savings of at least £355 million.
The Housing Corporation is also carrying out a thematic review, looking in more detail at how housing associations have performed. Results are to be published in January 2007.
The 450 largest housing association groups in England complete annual efficiency statements.
The statements require associations to report on their performance on workstreams including: capital works; management and maintenance; and commodity groups. Performance in relation to new supply workstreams is gathered and reported on separately.
The turnover for the sector reported in the 2005 Global Accounts totalled £8.3 billion. Therefore the efficiency gains achieved in 2005/06 represent 3.8% of the sector's turnover.
The Communities and Local Government Select Committee published the findings of its investigation into the new "planning gain supplement" (PGS).
PGS is a proposed tax on development, based on the increase in land value after planning permission is granted. The proceeds would be used to fund infrastructure.
The Select Committee recommended that low-cost homes should not be exempted from PGS. The housing association movement generally expressed disappointment at the recommendation, which could affect the delivery of 2000 affordable homes a year.
The National Housing Federation (NHF) added its concerns to the debate. The NHF supports the principle of PGS and agrees that it could help to raise much-needed funds for infrastructure. The Federation warned, however, that applying PGS to housing association homes would be "taking money from one part of the public purse to pay another."
David Orr, Chief Executive of the NHF, said: "We support the principle behind planning gain supplement, that land value rises can be captured to benefit the wider community.
"But allowing local authorities to apply it to housing association homes built with public funds would be madness - they'd be raiding money already set aside for affordable housing.
"Our modelling shows that if the supplement is set at 20% and applied to housing associations, it could reduce the number of new homes built by 2000 a year. Surely this isn't what the Government wants.
"Some people argue that policy makers don't need to go to the trouble of making an exemption for housing associations as affordable housing deflates land values. This assumption is simply wrong. The evidence shows that even when new developments include an affordable housing element, land values rise significantly after planning permission."
