1. Successful places with homes and jobs A NATIONAL AGENCY WORKING LOCALLY Affordable Housing Seminar East Midlands Councils Graham Dobbs Head of Area HCA 19 June 2013

2. Contents  Current delivery context  Delivery and 2013 Budget Announcements  Focus on AHP and AHGP  HCA role in Investment, Land, Market Interventions and Regulation  Conclusions

3. Current delivery context  Continued limits on public funding  Focus on growth  Localism  Risk – diversification and complex environment  HCA activity focused on five key areas: –Affordable housing –Market interventions –Public land –Economic Assets Programme –Regulation

4. 2012/13 Delivery  A strong year of delivery  HCA has met or exceeded all core targets: –114 ha of previously developed land back into productive use –323,000 sqm of new employment floor space created –£944m of private sector investment attracted –Exceeded housing delivery targets: 26,635 completions and 41,142 starts  Support of partners was key  New programmes & initiatives are foundation for strong delivery in 13/14

5. Budget 2013  Significant new investment channelled through the HCA –Help to Buy –Build to Rent –Affordable Homes Guarantees Programme  Builds on success of existing programmes  Increased Resource but focus on –Returnable Investment –less on Gap or Grant Speed of delivery is vital to maximise the impact of this investment on the economy.

6. 2013 Budget announcement - HCA ProgrammeBudget extra Impact Build to Rent£800mAdditional due diligence & bidding round 400% increase & extra year to 2015/16 Help to Buy£3.75bNew homes purchase programme to 2015/16 Affordable Homes Guarantee £225m100% increase to existing programme – extended bidding round & timeline to 2016/17 Local Infrastructure Fund- tbcMove from single initiative for 8 large sites to open bidding round to incl sites >1500 & EZ. Total£4.775b

7. Growth in value of capital programmes … Programmes have doubled in value during the SR

8.  Growth in number of Capital Programmes – CSR2010- Budget 2013 5 funded programmes plus 1 unfunded programme c/fwd 6 funded programmes 18 funded programmes plus 5 unfunded programmes Successful Places with Homes and Jobs

9. Supporting local growth: Housing, LEPs and Cities  Importance of housing and construction in helping drive economic growth is well recognised  HCA activity supports growth at a local level  Working with Local Enterprise Partnerships and Core Cities that identify housing, land and regeneration as growth priorities, and to develop joint investment models  Supporting the delivery of Enterprise Zones  Supporting local partners bidding for the Regional Growth Fund Our investment and expertise support local aspirations and deliver economic growth.

10. Our delivery role: Affordable Homes 2011-15  £4.8bn for up to 170,000 new homes  Up to £300m care and Support Specialised Housing Fund  Bringing up to 10,600 empty homes back into productive use  £2.1bn programme of investment in Decent Homes  TPF, Homelessness Change, Mortgage Rescue  Meeting locally identified needs  Influencing RP Business Plans – generating capacity We are helping to deliver the Government’s ambitions to build up to 170,000 new affordable homes, improve existing homes, and assist first time buyers

11. Affordable Homes Programme 2011-15 The role of Local Authorities  Articulate a clear vision and ambition for their area.  Assets delivery of affordable homes  Need continuous and meaningful ongoing dialogue with providers  Nominations to new homes  Agreement to conversions and new supply as ‘affordable’ rent or Affordable Home ownership  Maximise cross subsidy solutions e.g. land, S106, New Homes Bonus, HRA etc.  Maximise funding opportunities – government initiatives – flexibility/innovative

12. Affordable Homes Programme 2011-15 What next…  Continued Contract and Programme Management of Affordable Homes Programme –Quarterly review – delivery certainty, clarity on forecasts, final push for 100% scheme profiles –Significant emphasis on Starts by September 2013  Prepare for new programmes –Help to Buy – contracting with developers - Underway –Empty Homes 2 – Announcement 20 th June –Care and Support Specialised Housing – Announcement imminent –Build to Rent – shortlist announced and due diligence started –Local Infrastructure Fund – Assessment phase, announcement imminent –Affordable Homes Guarantees – Due diligence phase

13. Affordable Homes Guarantees Programme - The Basics  Combined funding up to £450m (£225m Autumn Statement, £225m 2013 Budget) – including London  To deliver up to 30,000 new affordable homes – both Affordable Rent and Shared Ownership  Completion by March 2017 but preferred delivery by 2015  Grant alongside guarantees and asset management flexibilities  Expectation that guarantees will drive good VFM for available grant

14. Affordable Homes Guarantees Programme - Prospectus and requirements  Bids required for named, firm sites  Scheme grant rate (not average payment rate)  Registered Providers – classified to the private sector  Schemes must start on site by March 2015  End date for completion March 2017 BUT significant proportion March 2015  s.106 must be delivered at nil grant  Products - Affordable Rent & Affordable Home Ownership  Design and Quality 2007 standards

15. Affordable Homes Guarantees Programme – Timeframe  Deadline for submission of bids – 21 May 2013  Assessment of bids – May-June  National aggregation & liaison with debt guarantee delivery partner – 26 June – 5 July  HCA Board & Ministerial sign off – Early July 2013  Announcement of allocations – Mid July 2013  Appetite – Those whose AHP allocations were scaled back?

16. Our delivery role: Market interventions  Increasing private sector housing starts through equity loans and other market interventions –£1bn Build to Rent –£570m Get Britain Building –£225m unlocking large scale sites –S106 mediation  £10bn Guarantees – linked to £500m AHP funding for new housing delivery  Increasing HCA loan portfolio – c.£1bn  £3.5bn Help to Buy to support aspiration

17. Our delivery role: Land  Bringing surplus public land to market to drive housing growth  HCA land development and disposal plan – land for 14,000 new homes by 2015  Enhanced role for HCA – additional £290m funding announced in Autumn statement  Pioneering ‘Build Now, Pay Later’ approach of deferred payment  Supporting central government in its land disposal We are using new ways to increase the supply of public land and speed up development

18. Our delivery role: Economic Assets  Supporting local economic growth through the development of assets  A major £700m asset portfolio – land, property and joint venture companies  Nationally important sites – Enterprise Zones  £120m invested and 100,000m 2 employment floor space in 12 months since programme established  100 more sites to be disposed in next 12 months We are a key delivery partner in Government’s ambition to make the best use of public assets to benefit communities

19. Regulation: a challenging environment  Sector is becoming more complex and challenging –Changing mix of funding sources –Welfare system changes –Diversification –For-profit providers –Bond finance  Regulator needs to keep pace  Regulatory Judgements – vast majority of providers meeting the standards

20. Conclusions  Public finance remains constrained; complex and challenging operating environment  Housing, land and construction as key drivers of local economic growth  But Budget builds on HCA success of existing programmes – more to come?  Risks and opportunities – needs partnership working by LA/RP/Developers/Govt. Dept. to maximise investment opportunities?  Future programmes ‘Bidding’?  Challenge or Opportunity? We are innovative, flexible and commercial in our approach to delivering public value and responding to challenges.

21. Keeping in touch  homesandcommunities.co.uk  // /HCA_UK  /homes-&-communities-agency