Burnham backs down from demand to spend housing fund solely on social homes

The UK government has set out how it will spend a major tranche of housing funding, departing from an earlier call by Greater Manchester mayor Andy Burnham to dedicate the entire budget to social homes. Burnham had argued that the full £39bn allocated over ten years under the Affordable Homes Programme should go to council homes, stressing that control over housing mattered.

However, plans announced on Monday take a different approach. Of the first £10bn, funding will support the building of 70,000 homes outside London, about 60% of which will be social rented housing. The remainder will go toward other subsidised housing types, including shared ownership schemes and sheltered housing for older people. London will receive a further £6bn, to be allocated at a later date.

Councils take on bigger role

The money will be delivered by 33 "strategic partners" guaranteed a decade of funding. For the first time in the scheme's history, three of these partners will be local councils, part of what Burnham has described as the biggest council housebuilding drive since the postwar era.

Housing secretary Angela Rayner highlighted the importance of secure council housing for families, saying the investment would help people move off waiting lists and build stable lives. Officials said a further £16bn remains unallocated, with future funding rounds set to prioritise social rent and council housing.

Shelter chief executive Sarah Elliott welcomed councils' expanded role but warned that obstacles remain, including unsustainable housing debt burdening local authorities, which she said the government should address in the autumn budget. The plans stand in contrast to proposals from Reform UK, which is pushing to expand social housing supply by evicting foreign tenants and letting housing associations borrow more.