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Affordable: A Smarter Way to Showcase Affordable Housing

Affordable: A Smarter Way to Showcase Affordable Housing

Rhiannon Harrop-Griffiths 03 Apr 2025
For decades, the UK has failed to provide enough affordable housing, leaving millions on waiting lists and living in unsuitable accommodation (there are c.1.29 million households in England[1], 139,000 in Wales[2] and 100,000 in Scotland[3] on housing waiting lists). Such situations create instability in terms of education, employment and social wellbeing. A reliance on temporary accommodation can have adverse physical and mental health implications for residents whilst also adding further pressure to already stretched local government resources.
The need to increase affordable housing delivery is recognised in policy across the UK:
  • The next Labour Government will deliver the biggest boost to affordable, social and council housing for a generation, as supported by their target to deliver of 1.5 million homes over the Labour government term (Angela Rayner, 2023)
  • The estimated annual additional homes are split almost equally between affordable housing (social housing or intermediate) and market housing. This represents an average of approximately 3,500 (48%) affordable homes per year (Future Wales 2040)
  • Scottish Government is committed to delivering 110,000 affordable homes by 2032 (Affordable Housing Supply Programme, Scottish Government)
An implication of the greater emphasis on affordable housing provision being pushed at the national level (across the UK, but particularly England following the election of the Labour Government) is that the weight that this is being afforded in determining planning applications and appeals is increasing. In October 2024, Inspector A. McGlone allowed two appeals for housing in Tamworth and Lichfield[4] (two applications for the same development which fell across the boundary of two local planning authorities), concluded there is a demonstrable need for housing and that this is “only greater than the housing registers and a national affordable housing crisis… Therefore, there would be no dis-benefit of providing affordable homes in this location, particularly as an insufficient provision of affordable homes affects people” (para 81).
What is also increasingly recognised is the benefits provided by affordable housing delivery. In reaching their decision on the Tamworth / Lichfield appeal the Inspector noted “being able to live in a good home is a foundation for everyday life. Homes provide stability and offer financial security, help physical and mental health, reduce social mobility and adverse effects on children’s education and development” (para 81).
The same sentiment was shared by Inspector J P Longmuir for a scheme in Southampton that will provide 84 dwellings, 35% of which will be affordable[5]: “the affordable housing would also contribute to the social objective, particularly as 35% of the dwellings would be affordable which is a significant proportion. This would help towards the pressing local need and support the wellbeing of the community as a whole” (para 102) (Lichfields emphasis).
Whilst private sector affordable housing providers and local authorities are usually well aware of these benefits, many planning applications fail to articulate the scale of the need for affordable housing or the magnitude of the benefits of its delivery. This means that they can be downplayed in the exercise of planning balance for the application.
Given the significant need to boost housing delivery and the importance of emphasising the case for the provision of affordable housing, Lichfields is pleased to launch Affordable. This new product is designed to identify the need for and benefits of affordable housing delivery. Its release comes just a week after the Chancellor in England announced a £2 billion injection of new grant funding to deliver up to 18,000 new social rent and affordable homes – a timely launch for a product that can be used to provide a robust evidence base to demonstrate the case for such accommodation. Indeed, Affordable could be also used to as part of bids to access some of this newly announced funding.
Affordable builds on our extensive experience in working with both housebuilders and local authorities with regards to affordable housing – both in terms of supporting the case for development and identifying opportunities to maximise the benefits of affordable housing to councils and local communities. The benefits identified are far ranging and include economic benefits for the local authority in respect of savings for temporary accommodation, the NHS in respect of improved health, and residents in respect of improved job opportunities, reduced fear of crime, and living in safe and secure housing. An example infographic is provided below.
Although the most recently published affordability data in England and Wales (released on 24 March 2025) has pointed towards a slight reduction in the housing affordability ratio, this has had no discernible impact on the need for affordable housing. Whereas the England, Wales and Scotland Governments have all set ambitious targets, either for overall housing delivery to increase at a significant rate or for affordable housing to account for a higher proportion of overall delivery, homelessness continues to rise to record levels and social and affordable homes only account for around 16% of the total housing stock in England[6].
We welcome the fact that some decision makers are now recognising the acute shortfall in affordable housing provision and the acute need to boost supply, and that this has translated into increased weight being given to the provision of affordable housing in planning applications and appeals. However, there is much more that can and should be done to demonstrate the case for affordable housing delivery and the wider benefits it provides. Affordable provides robust evidence that is underpinned by the latest statistics and presented with a clarity in a way that allows decision makers to focus on the challenge that exists and to understand the extent to which individual developments can make a tangible difference to the local need for affordable housing, whilst also delivering a wide range of social-economic benefits to the local community.

 

Footnotes

[1] Governement UK: Social housing lettings in England, tenants: April 2022 to March 2023 
[2] FOI Requests from BBC, later published by Shelter Cymru
[3] Scottish Government: Scottish Household Survey 2023
[4] Address: Land north of Browns Lane, Tamworth, Staffordshire Appeal refs:efs.: APP/K3145/W/24/3340089 & APP/Z3445/W/24/3340094 Decision date: 4 October 2024
[5] Address: Land to the rear of former St Mary’s College, Midanbury Lane, Southampton, Hampshire, SO18 4HE Appeal ref.: APP/D1780/W/24/3347358 Decision date: 19 February 2025
[6] UK Parliment: Affordable housing in England

Header image credit: Pillar Land Securities Ltd

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Spring Statement 2025: An emerging plan for growth in a changing world?

Spring Statement 2025: An emerging plan for growth in a changing world?

Lucie Bailey & Richard Coburn 27 Mar 2025
Against the backdrop of a challenging economic outlook, declining state of public finances and growing global geopolitical uncertainty, the Chancellor of the Exchequer’s Spring Statement 2025 was an important opportunity for the government to demonstrate a firm handle on the economy and a credible plan for delivering their “number one mission” for growth.
Having previously downgraded it to a ‘spring forecast’, the rapidly changing global context since the Budget was delivered last Autumn meant that Rachel Reeves’ speech in the House of Commons on Wednesday became much more significant.
As widely anticipated, the latest forecasts from the Office for Budget Responsibility (OBR) have downgraded UK economic growth to just 1.0% during 2025, which is half the rate expected back at the time of the Autumn Budget. Growth is then forecast to increase to 1.9% during 2026 and has been upgraded slightly in cumulative terms across the forecast period to Q1 2030.
 
Scarce pickings for public investment
Amidst the various cross-cutting spending cuts confirmed by the Chancellor, there were no ‘new’ announcements or funding commitments specifically in relation to planning and development.
Nevertheless, the Chancellor was keen to emphasise government’s “serious plan for growth”, citing some of the recent announcements already made to boost the economy including support for a third runway at Heathrow airport and £2 billion of grant funding to deliver up to 18,000 new social and affordable homes[1].
This follows the granting of development consent by the Secretary of State on Tuesday for the Lower Thames Crossing, and allocation of £600 million worth of investment to train up to 60,000 more skilled construction workers to help achieve government’s target to build 1.5 million homes in England by the end of this Parliament.
 
Planning reform remains in pole position
Planning reform was reiterated as being key to achieving this plan for growth, with the government’s flagship Planning and Infrastructure Bill having passed its second reading in the House of Commons on Monday.
The Chancellor was delighted to share the OBR’s conclusion that the planning reforms included in the updated (December 2024) National Planning Policy Framework (NPPF) will lead to 170,000 additional homes being built over the forecast period (i.e. to 2029-30), in turn increasing the level of real GDP by 0.2% and adding £6.8 billion to the economy (in today’s prices)[2].
This reflects the biggest positive real GDP effect that the OBR has ever reflected in its forecast for a policy with no fiscal cost. More explicitly, it shows that changes to the planning system have the potential to play a major role in driving economic growth if they can be implemented effectively.
In cumulative terms, the OBR expects net additions to the UK housing stock will amount to 1.3 million from 2025-26 to 2029-30, reaching 305,000 a year by 2029-30 (as shown in Figure 1 below).
 
Figure 1: Net additions and private housing completions

Source: Office for Budget Responsibility, Economic and fiscal outlook (March 2025)

This would see housebuilding reach its highest level in over 40 years and put the government within “touching distance” of achieving its manifesto promise of 1.5 million new homes by the end of this Parliament (albeit the 1.5 million target relates to England only, so in reality the ‘shortfall’ could be more significant).
 
Signs of a broader economic plan?
The Spring Statement was an obvious opportunity to back these planning reforms with specific measures to kick start economic activity and move the focus beyond house building. We are still awaiting the government’s full Industrial Strategy (following publication of the Green Paper ‘Invest 2035’ in October 2024) which will set out a 10-year plan for investing in the high growth sectors that will drive government’s growth mission. This is due to be published in ‘Spring 2025’, alongside Sector Plans for eight growth-driving sectors and aligned with the multi-year Spending Review. 
 
The economic role of defence
In advance of this, the Chancellor set out a series of initiatives and funding commitments to boost Britain’s defence industry as way of achieving economic growth alongside maintaining national security.  In particular, leveraging the additional £2.2 billion defence spending announced in the Spring Statement to invest in defence technology and innovation.
This includes establishing UK Defence Innovation (UKDI) to enable innovative technology to rapidly progress from idea to the front line to secure competitive advantage and wider economic spillovers.
A new Defence Growth Board, co-chaired by the Chancellor and Defence Secretary, aims to put defence ‘at the heart of the UK’s modern Industrial Strategy’, as the country develops its credentials as a “defence industrial superpower” armed with the skills, jobs and economic opportunities to strengthen the UK and drive economic growth.
Specific growth and investment locations were identified in the Spring Statement including the Cumbrian town of Barrow-in-Furness (home to defence giant BAE Systems), alongside a commitment to regenerate and secure the future of Portsmouth Naval Base. Given that defence spending has historically focused on south western and south eastern parts of the country (as shown on the interactive map below), the government will need to carefully consider how this top-down investment into defence priorities can deliver economic growth and opportunity for all parts of the country.
 

 
One down, seven sectors to go
Defence is rightly highlighted in Invest 2035 but represents just one of its eight priority growth sectors[3]. The country’s business communities are eager to learn more about the government’s plans for them all.  Similarly, local authorities including proposed Strategic Authorities are anxious to understand their role and priorities in enabling the sectors to grow. Whilst it is understandable for the Chancellor to emphasise that “the world has changed”, we suspect that the apparent delay to the publication of the final Industrial Strategy and associated Sector Plans relates to the disappearing prospect of sufficient fiscal headroom needed to stimulate investment anytime soon.   
The sector-focused approach is positive, logical and meaningful in economic policy terms.  However, if the government genuinely intends to ‘tackle barriers to growth’ and ‘create the right conditions for increased investment and higher quality jobs’, public sector capital will be required. Taking the creative industries as an example, it would be revealing to see how much investment is required simply to keep existing regionally and nationally important cultural assets operational and economically productive (not unlike the country’s tired and under-invested infrastructure system – from potholes to ubiquitous water leaks). This is before consideration is given to the capital support required, for example, to ensure affordable workspace is available for new creative enterprises throughout our cities, skills programme put in place to deliver the modern workforce needed for growing sectors or targeted funding gaps filled to ensure the next generation of theatres, arts and music venues can be realised.     
 
The role of planning in industrial strategy
Whilst government borrowing may provide an element of the investment required in the short-term, the growth community will need to be patient. In the meantime, the government should continue to make best use of the policy levers it has at its disposal to release latent private sector capital investment. Planning reform coupled with a direct relationship to economic development policy is probably one of the most potent tools available to government in a constrained economy. In anticipation of an industrial strategy with any teeth, the planning reform focus must move well beyond house building and start to address how it can be effective in enabling various forms of commercial, industrial, creative and other types of development which can collectively kick start economic growth. 
 
Lichfields is following the progress of the Planning and Infrastructure Bill and is considering the implications for the development industry including how planning can support priority growth sectors. Please visit our website to find out more, including our assessment of the government’s revisions to national policy and other reforms.

 

Footnotes

[1] The Spring Statetment 2025 notes that this is a bridge to a new programme, and in June the government will follow this with further announcements on wider long term investment into social and affordable housing through the Spending Review.
[2] CP 1289 – Office for Budget Responsibility – Economic and fiscal outlook – March 2025
[3] Invest 2035 identifies eight ‘growth driving sectors’:  Advanced Manufacturing, Clean Energy Industries, Creative Industries, Defence, Digital and Technologies, Financial Services, Life Sciences, and Professional and Business Services.

Image credit: Jacob Diehl via Unsplash

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