Housing Minister John Healey gave the green light for work to begin building over two thousand new council homes that will help create over five thousand jobs in the construction industry.
Despite the recession this is the biggest council house building programme for almost two decades. Forty seven councils, covering every region of the country, will receive a share of £127 million Government funding to help build these homes. They will match funding, bringing the total investment to over £250 million. Mr Healey said that construction will begin on the first sites before the end of the year and he will announce a second wave of projects in the autumn.
Of the new council homes announced, 80% will be built to standards well above that required by Building Regulations, helping to cut CO2 emissions and reduce energy bills.
All bids were subject to tough testing. They had to represent value for money, help meet specific local housing needs and be able to begin construction before March 2010. Crucially only bids for the construction of new council homes for rent were eligible.
In total 51 councils submitted bids. Bids from four councils were considered not to represent value for money and the Minister has asked the Homes and Communities Agency (HCA) to work with these councils to strengthen their bids for consideration later this month, or for resubmitting bids in round two.
The Housing Minister also confirmed a further boost for affordable housing, with almost £250 million to provide 3,400 affordable homes and create around 5,000 jobs. Every region of the country will receive funding which is shared between 43 housing associations and other bodies operating across 97 local authority areas.
The two announcements add up to a half billion to provide 5,400 new affordable homes, creating around 10,000 jobs.
The Homes and Communities Agency (HCA) has received 132 completed submissions from a range of construction and development companies, to the Pre-Qualifying Questionnaire (PQQ) for a panel being set up to develop its sites, which can also be used by Local Authority partners for developing their land.
The Delivery Partner Panel framework will exist for three years and be split into three regional clusters - Northern, Central and Southern panel - each with 6 to 12 members. Panel members will cover the full range of development activity including, but not limited to:
Panel members will be responsible for securing sales of completed homes either themselves or by working with partner organisations.
The majority of the submissions were made by construction and developer companies with around a fifth of submissions from RSLs, and a small number from a mix of consultancies and other organisations.
The bids are assessed by the HCA and an invitation to tender is then issued to the shortlisted organisations. There will be up to 20 firms shortlisted for each panel.
Of the bids received, 29% expressed an interest in all three regional clusters, 45% expressed an interest in two and 45% had a preference for one regional cluster only.
Housing Minister John Healey announced that ten stalled development projects have been given the go-ahead to receive the first wave of Government cash to get building work on 740 homes back on track. Construction workers on the first project will be back on site from next month.
Mr Healey also pledged to make apprenticeship schemes and local recruitment a condition for securing Government support through the Prime Minister's £1.5 billion Housing Pledge, announced in Building Britain's Future in June.
The 10 housing schemes will receive over £10 million to complete 740 new homes. The projects have cleared a detailed assessment by the Homes and Communities Agency through the £1 billion Kickstart programme.
Nine of the ten projects given the go-ahead are run by developers with established apprenticeship schemes.
The Minister also launched the second round of the Kickstart programme and announced the new requirement of all firms bidding for funds to offer apprenticeships and jobs to local people.
Homes and Communities Agency Chief Executive Sir Bob Kerslake said:
"Kickstart isn't just about unlocking more homes - it will also be the catalyst that delivers a much-wider set of benefits to local communities, including job opportunities, apprenticeships and accommodation for vulnerable people.
"This first set of successful bidders is just the start - we'll now be working through the remaining bids with the aim of finalising all the allocations for this first round in the next two months to ensure that schemes start-on-site by March 2010."
The Kickstart support involves tough terms - almost half the money from this must be repaid within five years, over one third will go to housing associations and others to help them manage the affordable housing, and less than one fifth consists of direct grant to support developers. Only developers who have accepted a realistic current market price for their land were eligible for Government investment. All of these projects have gone through a rigorous assessment before getting the green light.
This funding will only be used to make projects that have been mothballed in the current economic climate viable, and is only being provided where developers cannot get support from other sources. It will boost development funding available, reduce levels of risk associated with projects and help support demand from homebuyers through measures such as Homebuy Direct.
