Out-Law News 1 min. read
23 Jul 2012, 5:13 pm
Grant payments were planned to be paid when developments were completed under the £1.8 billion AHP, announced in 2011. However, part of the grant payment has been brought forward following a report by the National Audit Office which estimated that over half the homes under the AHP were planned to be built in either 2014 or 2015.
The Homes and Communities Agency sent letters to all housing associations and local authorities involved in the scheme on Thursday to inform them of the change, according to an Inside Housing report. Private developers, which are also building homes under the programme, will not be eligible for early payments.
"It is designed to help maintain delivery momentum," said an HCA spokesperson, according to the report. "The change would also help to mitigate against the backloading of the programme."
It was confirmed last week that grants under the programme could also be re-allocated from one provider to another.
"If a provider isn’t able to deliver on a specific site that was identified when the bid was first made, there is the ability to shift around within the programme to firmed up sites if there is a particular issue," said Pat Ritchie, chief executive of the HCA.. "We also have provision to move around between providers."
A National Audit Office report found that the AHP is likely to be delayed beyond its 2015 deadline. The report found that more than half of the homes planned under the scheme are not due to be delivered until 2015, the final year of the scheme. Any delay in the programme of delivery would cause the whole scheme to be held up, it said.
"The Affordable Homes Programme has made a good start, with providers committing themselves to building some 24,000 more homes than originally expected," said Amyas Morse, head of the NAO. "There are key risks, however, including the fact that more than half of the homes are planned for the final year, with no room for slippage. The final judgment on the success of the Programme will depend on how well these risks can be managed between now and 2015."
It is hoped that by releasing part of the grant when building is started on site it will ease cash flow and enable housing associations to start building on sites sooner than planned.
