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Building Permits up 6. 8% Nationwide For the Month of July… Here’s What We Can Expect

By Judi Desiderio, Thursday, August 16, 2012
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National Housing Federation responds to the Chancellor’s statement.

21 March 2012

Responding to the Budget and its impact on the housing sector, National Housing Federation chief executive David Orr says:

‘We welcome the Chancellor’s move to close the loophole that allowed wealthy individuals to buy properties through companies and avoid stamp duty. It meant people on high incomes could avoid paying tax on the purchase of expensive homes.

‘However it is disappointing that the Chancellor has failed to put investment in housing at the forefront of driving forward economic growth in the UK.

‘Supporting housing associations to maximize the investment they make in building and maintaining homes creates new jobs, saves the Government benefit payments, invests in local communities and boosts general economic activity.

‘Every new home built creates 1.5 new jobs directly and up to four times as many in the wider economy. It also improves access to housing overall particularly for those on lower and middle incomes. Few other sectors can offer this potential with such short lead-in times and the prospect of so much growth directly benefiting local communities.
‘Boosting the housing sector would be an easy win for the economy, for taxpayers and for families. And with 4.5 million people on waiting lists and one million children in overcrowded accommodation a big boost for fairness too.’

Responses to specific housing issues are below:

VAT for repairs and maintenance

On failure to reduce the rate of VAT to works to repair and maintain social housing property:

National Housing Federation chief executive David Orr says:

‘The Government missed a vital opportunity to extend the reduced rate of VAT to works to repair and maintain social housing property. This simple measure, which wouldn’t have cost the Government more money, would have released in excess of £620 million a year for housing associations. This would not only improve the quality of the housing provision but also assist in meeting the growing need for more social housing. This relief is already available in other parts of the EU.’

Energy efficiency improvements

On failing to extend the reduce rate of VAT (to 5%) to works to improve the energy efficiency to housing association homes:

National Housing Federation chief executive David Orr says:

‘The Government has missed a crucial opportunity to extend the reduced rate of VAT on works to improve the energy efficiency for all housing association tenants, who could benefit from cheaper energy bills and reduced fuel poverty.

‘Only minor changes to the legislation would have allowed the reduced rate to be extended to all housing association tenants so housing associations can improve the energy efficiency of existing homes. But this anomaly has opened a chasm between those who had housing associations as their landlords and those who don’t.
“If the reduced rate was applied to all, the VAT saving would be almost £12 million – meaning a further 3,300 homes could have their heating replaced in 2011.’

National Planning Policy Framework

On the National Planning Policy Framework:

National Housing Federation chief executive David Orr says:

‘We are pleased to hear the Chancellor say that the National Planning Policy Framework next week will strongly emphasize growth.

‘For local businesses to flourish, housing for people of all income levels is needed. We urge the Government to ensure the NPPF requires local plans with strong policies on the supply of affordable housing.

‘With average house prices still at 11 times average incomes and 4.5 million people on waiting lists, local plans have a vital role to play in ensuring we can also build housing for people on low to moderate incomes.’

Welfare Reform

On Welfare Reform:

National Housing Federation chief executive David Orr says:

‘Social tenants – including those in work – are facing significant cuts in their support for housing costs under the Welfare Reform Act.

‘We are concerned that the Chancellor wants to make further savings on welfare payments before the impact of the current cuts on families has been understood. The Government should wait to assess the impact of the bedroom tax, the overall benefit cap and the shift to Universal Credit before embarking on a fresh round of changes.

‘The best way of reducing the welfare bill is to get people into work. Economic growth – which can be boosted by building new homes – is central to this.’

Feed in Tariffs

On equalizing Feed in Tariffs (FiTs) schemes in charitable and non-charitable housing associations:

National Housing Federation chief executive David Orr says:

‘Recent government changes have made it difficult for housing associations to consider FiTs as a means to reduce carbon emissions and fuel poverty. However, despite that, many have persisted with FiTs.

‘We are disappointed the Government has not equalized this anomaly that exists in the taxation of FiTs in the hands of charitable and non-charitable housing associations.

‘Equalization of the tax treatment will allow housing associations to carry out more of these installations – reducing both carbon emissions and fuel poverty.”