Report on the work of the 2021 Affordable Housing Investment Benchmarks Working Group

Affordable Housing Investment Benchmarks have successfully supported the delivery of the Affordable Housing Supply Programme for a number of years.  While local government and a number of sector organisations had been requesting a review of the current set of assumptions for a couple of years, the Scottish Government convened a working group in March 2021 to assess whether these now required adjustment in order to provide confidence and certainty to ongoing Programme delivery.

The purpose of the group

The group comprised officers from the Scottish Government, COSLA, the Association of Local Authority Chief Housing Officers (ALACHO), the Society of Local Authority Chief Executives (SOLACE), Local Authority Directors of Finance, the Scottish Federation of Housing Associations (SFHA) and the Glasgow and West of Scotland Forum of Housing Associations (GWSF) (Annex A).  It was established with the following purpose:

• to assess whether adjustments are required to the current set of benchmark assumptions which underpin the grant-funded element of the Affordable Housing Supply Programme to account for inflation, additional quality measures (that is those set out in the 2020-21 Programme for Government, future enhancements to the energy performance of buildings, and the installation of automatic fire suppression systems), and any other factors agreed by the group as meriting consideration
• to consider the timeframe over which the new set of Affordable Housing Investment Benchmark assumptions should be in place (if adjustments are required)
• to consider the potential impact that the group’s recommendations would have on the number of homes that could be delivered through the grant-funded element of the Affordable Housing Supply Programme, and    
• to consider the criteria which should be applied when appraising project proposals which are seeking investment in excess of the relevant Affordable Housing Investment Benchmark.    

The review was undertaken over the period March to June 2021, and drew upon a range of information and material submitted by members of the group to support the work.  A timeline of events is contained in Annex B.