Welsh government’s final budget insufficient to meet social housing targets, warns CIH

The Welsh government’s final budget falls short of the amount needed to deliver its social housing development ambitions, according to the Chartered Institute of Housing (CIH) Cymru.

The final budget published yesterday, confirms capital investment in social housing of slightly more than £437m for 2025/26, as proposed in the draft budget in December. 

This includes an annual increase of £81m in funding across the social housing grant and transitional accommodation capital programme (TACP), which supports social landlords to bring forward longer-term homes.

However, Matt Dicks, national director of CIH Cymru, said the new £437m figure still “falls well short” of the £580 million to £740 million that Audit Wales recently identified as being necessary to meet the government’s goal of delivering 20,000 additional low carbon homes for social rent by 2026.

The membership body also said it remains “concerned” that the money allocated for the decarbonisation of existing homes is insufficient.

The government has kept the 3% annual increase from £92m to £95m laid out in the draft budget in December, despite concerns being raised at the time.

Dicks said: “The additional £3 million allocated to decarbonising our homes is unlikely to meet the shared ambitions of social landlords in Wales and Welsh Government around building new affordable homes and decarbonising our existing homes.

“These twin ambitions have already placed great pressure on existing business models of housing organisations, and whilst there is a significant allocation of capital investment for development in the final budget, this is not mirrored in the capital investment for decarbonisation.”

Meanwhile, the housing support grant, which is paid to local authorities in Wales, has received a £21m uplift to bring the total level of funding up to £204m. Despite this, the CIH has noted that “other homelessness prevention grants have received a cash flat settlement at a time of rising homelessness and temporary accommodation use.”

Dicks explained: “ If we really want to end our housing and homelessness crisis, we need to make providing everyone in Wales with a safe, suitable and affordable home a foundation mission of government.

“The starting point of that journey is the full incorporation of the Right to Adequate Housing into Welsh law. Our own #Backthebill research has shown that providing everyone in Wales with a safe, sustainable and affordable place to call home will save the public purse £11.5 billion with an upfront investment of £5 billion in monies that can be reinvested to ensure that future budgets reflect the scale of the housing emergency we face.”