On Wednesday, 26 March, the Chancellor of the Exchequer, Rachel Reeves, delivered the 2025 Spring Statement in the House of Commons.
24 hours before her speech to the Commons, Ms Reeves announced that the government was “fixing the housing crisis in this country with the biggest boost in social and affordable housebuilding in a generation”.
This appeared to show that the current government was beginning to lay the foundations for reaching its ambitious housebuilding targets, including strong commitments to social housing. However, behind the soundbites, was there actually much substance to the new proposals?
Let’s take a closer look at the announced measures with significant implications for the social housing sector.
£2 billion investment in affordable housing
The Chancellor announced a £2 billion boost to the Affordable Homes Programme, hoping to support the construction of up to 18,000 new affordable and social homes.
This is part of the Government’s wider objective to build 1.5 million homes by 2029-2030, with an annual target of 305,000 homes by the end of the decade.
The additional funds are intended to assist local authorities and housing associations in bridging financial gaps for affordable housing projects. With the 2021-2026 Affordable Homes Programme soon drawing to a close, the extra £2 billion is intended to tide things over until a new programme begins.
The new affordable homes will start construction by March 2027 and will be completed by the end of this Parliament, according to Ms Reeves.
Planning reforms to accelerate housebuilding
The Government also introduced changes to the National Planning Policy Framework, including reintroducing mandatory housing targets and incorporating “grey belt” land into development plans.
These reforms aim to deliver an extra 170,000 homes by 2029/30, which could result in housebuilding being at its highest level in over 40 years. The Office for Budget Responsibility (OBR) estimates that these changes will contribute an additional £6.8 billion to the UK’s GDP by 2029-2030 (an increase of 0.2%).
The OBR also predicts that this will help to build 1.3 million new homes over the next five years, which Ms Reeves flagged as bringing the Government “within touching distance” of the 1.5 million target.
Note: The long-term housing strategy and the new Affordable Homes Programme (mentioned above) are not reflected in this forecast. However, it will all help to reach the “Plan for Growth” 1.5 million homes target this Parliament.
Support for construction workforce development
The Government also revealed they wish to address labour shortages in the construction industry, allocating £600 million to train up to 60,000 new construction workers through technical colleges, apprenticeships and skills bootcamps.
This investment aims to ensure that the workforce can meet the increased demand for housing construction.
In response to the Spring Statement, Peter Luck, Business and Operations Director, ROCC, said: “I was pleased to see the Government’s renewed commitment to social housing outlined in the recent Spring Statement.
“For too long, social housing has stood as the silent cornerstone of community well-being, quietly delivering safe, affordable homes to millions, while often operating under mounting pressure and financial constraints.
“This year’s Spring Statement, with its tangible support and investment pledges, marks a positive step towards recognising the essential role housing providers play – not just in bricks and mortar, but in building resilient, inclusive communities.”
You can read the Government’s full Spring Statement here.
