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Where do we go from here?
Northern Ireland’s social housing sector calls for clarity on the country’s long-term housing strategy and funding pipeline, following a drastic cut to the budget for new social homes
STRATEGY
Seamus Leheny
CEO, Northern Ireland Federation of Housing Associations
Seamus Leheny
CEO, Northern Ireland Federation of Housing Associations
Issue 74 | October 2024
Housing is a hot topic of conversation in Northern Ireland, with increasing political and media debate. A growing housing waiting list, combined with a lack of appropriate funding to keep pace with rising homelessness and those seeking social housing, has brought us to where we are today.
The initial capital budget for 2024/5 given to the Department for Communities will only allow for up to 400 new social homes to be started in 2024/5. The number of social housing new starts over the past four years has been as follows: 2,403, 1,713, 1,956 and 1,506. This is an average of 1,894 over the past four years.
The Minister for Communities, Gordon Lyons MLA, recently outlined that the target he had set for social housing new starts in 2024/5 was 2,000 homes. The anticipated budget capital budget provided to his department will only allow for up to 20% of that target to be met.
“This budget, passed by the Executive collectively, has dramatically reduced the number of new social homes which can be started this year.”
Drastic cut
This drastic cut to social housing new builds frustrates the policy direction of the Executive, including the ‘New Decade, New Approach’ commitment for a Programme for Government which included as an outcome a “specific focus on ensuring every household has access to a good quality, affordable and sustainable home”.
The funding cut also undermines the policy direction set out in the Homelessness Strategy 2022-27 and the draft Housing Supply Strategy. Further, the inevitable consequence of this decision will be increased homelessness and people staying longer in temporary accommodation, adding pressure on the NIHE, health and education budgets.
The reality is that Northern Ireland urgently needs more social housing. However, this budget, passed by the Executive collectively, has instead dramatically reduced the number of new social homes which can be started this year.
Department for Communities target for social housing new starts in 2024/25 prior to budget announcement
average number of social homes started each year over the past four years
number of new social homes that can be built in 2024/25 with the allocated budget
Value for money
Housing associations can deliver in excess of 2,000 new social homes per annum, all they need is for the government to provide the green light with adequate funding. The current model for financing new social housing in Northern Ireland is effective and provides value for money for public expenditure. This is because for every £100 provided from the public purse via the SHDP, housing associations can raise an additional £84, thus ensuring we can deliver as many new homes as possible every year.
The NIHE has established a new build target of 2,300 social homes per annum from 2024/25 and has projected a new build requirement of 24,992 homes for the period 2023–2028. The housing association sector here can deliver these targets, but without an adequate budget to help fund, these targets are unlikely to be met.
“Housing associations can deliver in excess of 2,000 new social homes per annum, all they need is for the government to provide the green light with adequate funding.”
“If this is not addressed, the Assembly is effectively waving a white flag and accepting that we cannot realistically provide housing for our citizens in need.”
Multi-year budget
What’s critically needed is that the Executive delivers a multi-year budget in tandem with a Programme for Government that has housing as a standalone outcome. This can give housing associations a pipeline of funding that can help deliver and plan a strategic outcome for new build social housing that gives certainty.
At present, housing associations plan their new build developments on estimated budgets but with no real certainty due to annual standalone budgets. Housing associations are exposed in any shortfalls, such as what they are facing this year, with an expected decrease in new build starts of 73% year on year (1,508 in 2023/24 versus an estimated 400 in 2024/25).
Everyone I speak to in the government acknowledges the challenges facing housing. But in reality, the housing waiting list and the social housing budget are going in very different directions, and at a rapidly increasing pace.
While figures showed an 18% increase in the number of applicants on the waiting list over the past 10 years, the budget available for new build social housing is shrinking and recent decisions will lead to at least a 73% reduction in the number of new build homes compared to last year.
If this is not addressed, the Assembly is effectively waving a white flag and accepting that we cannot realistically provide housing for our citizens in need. In the first quarter of this year alone more than 850 applicants presented as being in housing need; but as things stand, we will be building less than half that number of homes over a whole year.
An appropriate housing supply strategy provides the perfect foundation for people, communities and the economy to thrive and this is a key objective for me to achieve, but for now, we lack basic clarity on how and where any strategy will take us.
