Budget to include £1bn for social and affordable housing

The upcoming Budget will deliver over £1 billion for social and affordable housing initiatives in England, pushing the government’s 10-year homes programme funding beyond the £40 billion mark. Alongside this, regional leaders and mayors across the country are anticipated to receive expanded powers and increased funding, including assistance for councils to borrow money at preferential interest rates to support housebuilding projects. These measures aim to provide local authorities with greater flexibility and autonomy in making investment decisions tailored to their communities’ needs.

Chancellor John Healey emphasized that cities and regions in England will gain the “right to decide their own future,” while Prime Minister Andy Burnham highlighted the shift of power towards those “who know their communities best.” Additionally, additional support for small breweries will be introduced, with the Treasury expressing its intention “to turn the tide for our pint producers.” Meanwhile, according to reports from the Sunday Times, Healey is expected to announce billions in new defence funding in the Budget, with detailed plans to be laid out in next year’s spending review. The opposition, however, led by shadow chancellor Andrew Griffith, has urged Healey to resign if he does not commit to meeting the target of spending 3% of the UK’s GDP on defence by 2030.

As part of the regional investment strategy, the government will allocate an initial £285 million in seed funding next year to assist mayors and local leaders, aiming to move away from reliance on fragmented Whitehall funding pots. A new £1.5 billion borrowing facility is also planned for introduction in 2028, allowing local authorities to access the capital necessary to support a range of priorities, such as new housing developments, revitalizing high streets, or enhancing transport infrastructure. Healey remarked, “Mayors and local leaders know what their communities need to grow, which is why we are giving them more money, more power and more capacity to get projects moving, build homes and make the right decisions for their areas.” The funding will not only support strategic authorities but will also be accessible to other areas, enabling projects that contribute to local growth.

Prime Minister Burnham reinforced the importance of devolving power, stating, “I’m calling time on local leaders going cap in hand to Westminster. That is no way to run a country.” Claire Ward, chairwoman of the UK Mayors Network and a Labour mayor, welcomed the move, saying increased devolution of powers and resources would transform ambitious plans into tangible, lasting improvements for communities. London’s mayor, Lord Sadiq Khan, noted that enhanced investment capabilities could facilitate major infrastructure projects, including the West London Orbital route, extensions of the Bakerloo Underground line and the Docklands Light Railway, and expansion of Stratford International station.

Amid these Budget preparations, Healey faced a setback with the resignation of Treasury entrepreneurship adviser Alex Depledge, who plans to leave the day after the Budget. She criticized the government for sidelining start-ups, calling them a “sideshow” and warning that failing to support scale-ups ignores the contributions of some of Britain’s most successful companies. Defence issues have also remained central, recalling Healey’s resignation last June from his previous role as defence secretary over concerns that defence investment plans were insufficient. He has advocated for defence spending to increase to 3% of GDP by 2030, progressing towards NATO’s 3.5% target by 2035. Shadow chancellor Griffith called on the chancellor to commit to these defence targets, emphasizing that national security is essential to a strong economy. In response, Defence Secretary Wes Streeting blamed previous Conservative governments for underinvestment and reaffirmed the current administration’s determination to provide the armed forces with the funding necessary to ensure safety

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