Last year, the government set out a new strategy to to deliver ‘a decade of renewal for affordable and social housing’.
One of the measures introduced was a new National Housing Bank, with a £2.5 billion fund of low interest loans to support the development of new social housing.
However the fund is not available to Housing Revenue Accounts to stimulate the development of new council homes – despite the government setting the target for 1.5 million new council homes to be built in the next decade. Instead the low-interest loans will only be available to private housing providers.
The Council Motion below is adapted from a motion moved by St Alban Liberal Democrats. It calls on the government to reverse its position and allow councils to utilise these low interest loans for social housing through their Housing Revenue Accounts. It refers to the Securing the Future of Council Housing report from Southwark Council, signed by over 100 local authorities, that makes this recommendation.
You can copy, paste and adapt the council motion below:
This Council:
- Supports the building of council owned social housing.
- Believes a secure, decent home is the foundation to lead happy, healthy lives and we should be doing all we can to build the homes needed.
- Notes the creation of a new National Housing Bank that is making available £2.5 billion in low-interest loans to support the development of social and affordable housing, aiming to build 1.5 million homes over a 10-year period.
- Is dismayed that the Government is denying councils access to the new low-interest loans scheme as per the letter from Matthew Pennycook MP dated 7 November 2025;
“…I am also taking this opportunity to confirm that our new low-interest loans scheme will not be available to councils. I appreciate fully that this news will come as a disappointment. However, having carefully considered the fiscal implications of extending the scheme to councils, we reluctantly arrived at the conclusion that it would not be possible. As such, the scheme will only be available to Private Registered Providers. …”
Council further notes the report authored by Southwark Council, ‘Securing the Future of Council Housing’ published in September 2024 and signed in partnership with over 100 local authorities [INCLUDING COUNCIL NAME IF YOUR COUNCIL SIGNED IT].
This report strongly recommends that low-interest loans be made available to local authorities by the National Housing Bank, and that the fiscal implications the Secretary of State refers to in his decision not to allow this should not apply to public corporations such as the Housing Revenue Account:
“The UK government’s choice to include public corporations in the debt measure used for fiscal targeting is therefore an unnecessary distortion that prejudices political decision making against borrowing for investment in council housing.”
“This leads to recommendation 9 in the report: “Debt-targeting fiscal rules adopted by the UK government should use the accepted international GGGD measure as the definition of public debt, which excludes public corporations such as the Housing Revenue Account.”
Therefore this Council: –
- Affirms its support for recommendation 9 as above and the following statement in the Southwark housing report:
“In launching a new framework for council housing, government should reassert the vital importance of investment in social housing for the UK’s economic growth and ensure that national fiscal rules do not arbitrarily discriminate against councils’ prudential use of borrowing to support that investment.” - Notes it is a Government choice to include housing revenue accounts within the debt measure used for fiscal targeting and is therefore within the Government’s power to change this.
- Asks the Leader of the Council to write to the Secretary of State for Housing, Communities and Local Government:
- To express this Council’s dismay at its exclusion from accessing the new low interest loans scheme in the strongest possible terms, and;
- To ask, that if the Government is serious about its support for social housing and building its targeted 1.5 million homes why it is not doing all it can to support councils with the desire to build council homes by offering them a low interest loan scheme equivalent to that proposed for private housing providers.
- To express this Council’s dismay at its exclusion from accessing the new low interest loans scheme in the strongest possible terms, and;
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