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

Good homes and strong communities play a significant role in creating a more successful country with opportunities for all to flourish through increased wellbeing, and sustainable and inclusive economic growth.  ‘Housing to 2040’ – the Scottish Government’s first ever long-term national housing strategy – sets out a vision for what housing will look like, and how it will be provided to the people of Scotland, no matter where they live and what point in their life they are in.  The strategy sets out a new ambition to deliver 100,000 affordable homes by 2032.  This ambition will not only make an important contribution to achieving the Housing to 2040 vision but will also bring benefits across the ‘National Performance Framework’.  The delivery of the shared outcomes within the National Performance Framework is supported by a strong commitment of all partners for collaborative working between national and local government to invest in the delivery of a greater number of affordable and particularly social homes.

The planning and delivery of affordable housing is focussed on meeting local needs by supporting the ‘right homes in the right place’.  Local authorities, as both the statutory housing and planning authority, are responsible for assessing their housing requirements, ensuring a generous supply of housing land and enabling the delivery of both market and affordable housing.  The ‘Local Housing Strategy’ sets out the authority’s strategic vision for housing, taking into account both national policy objectives and local priorities, based on need and demand evidence.  As well as its strategic response to national outcomes and national housing priorities, the Local Housing Strategy sets out the approach to meeting other statutory housing responsibilities, including fuel poverty, house condition and homelessness.  It also provides people with a vital opportunity to have their say and influence the future delivery of housing and housing related services in their communities.

The 2001 Housing (Scotland) Act places a statutory requirement on local authorities to prepare a Local Housing Strategy which encourages equal opportunities.  In addition, the Equality Act 2010 and the Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012, 2015, and 2016 introduce duties that public bodies are legally required to meet in the exercise of their functions.  Local Housing Strategy guidance makes clear that local authorities should ensure that equality is central to all housing and housing services delivery and that the Local Housing Strategy should include a statement that reflects the local authority’s commitment to addressing inequalities in housing and should provide details on how this will be achieved.  Local authorities are expected to demonstrate how findings from an Equality Impact Assessment have translated into priorities and outcomes in the Local Housing Strategy.   

Strategic Housing Investment Plans are prepared by local authorities annually and set out the key development priorities in each local authority area.  These are directly informed by the relevant Local Housing Strategy priorities and are developed in consultation with key stakeholders.  Each Strategic Housing Investment Plan is approved by local Elected Members and:

• reinforces the role of the local authority as the strategic housing authority
• reinforces the importance of the outcomes and targets set out in the Local Housing Strategy, and
• identifies the projects which will be included in the Affordable Housing Supply Programme annual Strategic Local Programme Agreements.

Affordable Housing Investment Benchmarks

The Affordable Housing Supply Programme aims to increase and accelerate the supply of affordable homes in communities across Scotland – it supports local authorities in delivering their affordable housing priorities by providing quality homes in mixed communities that fit local need.  The grant funding which is available through the Programme primarily supports the delivery of social rented housing, homes for mid-market rent, and the provision of housing for low cost home ownership.

When applying for grant assistance to deliver affordable housing, councils and RSLs (‘grant applicants’) are required to self-certify that the amount of funding that they are requesting is the minimum required for a project to be financially viable for their organisation.  The amount of grant requested is then compared with the applicable Affordable Housing Investment Benchmark (which should be agreed with the relevant grant provider[1] before progressing to tender stage) to determine how the funding application will be assessed.  Projects that can be delivered with grant funding at or below the relevant benchmark follow a streamlined application and approval process, with projects which are seeking grant funding in excess of the relevant benchmark following a more detailed value for money assessment.  Benchmark assumptions are not therefore grant rates or grant ceilings.