Autumn Budget: social housing sector casts doubt on funding pledges amid looming tax rises
John Guest, Partner and Head of Social Housing at RSM UK, comments: “With the Autumn Budget fast approaching, the social housing sector is bracing for clarity on whether the government will commit to its funding pledges announced in the spending review amid tightening fiscal constraints. There has been strong rhetoric around the need for social affordable housing as part of the 1.5m homes target, but with pressure mounting to close the funding gap, there is growing concern that social housing could become a casualty of broader spending restraint.
“Registered providers (RPs) of social housing are already navigating within a more challenging environment, with inflation and budgetary decisions playing a critical role in shaping their cost base and operating margins. Any shifts in fiscal policy could ripple through financial markets, potentially influencing base rate expectations and delaying much-needed rate cuts. This would compound pressures on development pipelines and labour costs.”
He added: “While fiscal consolidation will be a key focus for the Chancellor, relying solely on tax increases could stifle growth, given persistent inflationary pressures. This is particularly concerning given the uncertainty around how the pledged investment in social housing over the next decade will be allocated and delivered. As such, spending restraint in the sector needs to be handled with care, ensuring financial sustainability for RPs and a fair and safe rent environment for tenants. The Autumn Budget must therefore deliver the clarity and confidence needed to sustain momentum in affordable housing delivery.”