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Housing Investment Programmes

Volume 164: debated on Thursday 21 December 1989

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To ask the Secretary of State for the Environment when he will make the allocations to local authorities in England for their housing investment programmes in 1990–91.

Each housing authority is today being informed of its housing investment programme (HIP) allocation for 1990–91. Copies of the letters to authorities and of the schedule of HIP allocations will be placed in the Library and the Vote Office.The local authority associations have been consulted about the distribution of HIP allocations, including the construction of the generalised needs index (GNI), which has been comprehensively reviewed. My right hon. Friend has also consulted the local authority associations, local authorities and others about the determination of housing revenue account subsidy for 1990–91 and has decided that £30 million should be transferred from the total available for housing credit approvals in 1990–91 to increase the resources available for HRA subsidy.Local authority credit approvals and specified capital grants will therefore total £1,784 million in 1990–91, not including £112 million for the special homelessness initiative. The Local Government and Housing Act 1989 allows my right hon. Friend to take account of local authorities' capital receipts when making allocations, and the housing element of the receipts taken into account in this way is £270 million. Housing investment programme (HIP) allocations for 1990–91 will therefore total £2,054 million.HIP allocations in 1990–91 totalled £1,110 million, and the large increase in the total for allocations in 1990–91 has been made possible by the provisions of the Local Government and Housing Act 1989. As a result, about two thirds of the total capital resources that local authorities are expected to spend on housing next year can be targeted to reflect differences in local needs, compared with about one third in recent years.After considering the views of the local authority associations, my right hon. Friend has concluded that a

revised GNI should be introduced for 1990–91, and that the distribution of resources should be made on the following basis:

  • (i) £164·5 million to be allocated separately as supplementary credit approvals (SCAs), as follows:
  • (a) £110 million for the estate action programme, for new and some continuation schemes. (A further £80 million for the remaining estate action continuation schemes is being allocated to authorities on the basis of agreed levels of commitment as part of their main HIP allocations).
  • (b) £54·5 million held back for later distribution, of which £10 million is expected to be to cover renewal areas declared during the year, and the remainder primarily to provide against demand under the new renovation grant system for mandatory grants in excess of authorities' available resources.
  • (ii) My right hon. Friend's view is that the existing system of weighting the GNI scores of the 57 "Action for Cities" target areas is not only obscure, but also ineffective in ensuring that additional resources reach those inner city authorities most in need of them. He has therefore decided that, for 1990–91, £100 million of the total for HIP allocations should be allocated to the 57 "Action for Cities" target areas as distinct inner city special allocations. These resources have been distributed to the DOE regions in proportion to the GNI scores of the 57 authorities. Each region's total for inner city special allocations has been allocated to the 57 authorities following recommendations by the Department's regional housing controllers.
  • (iii) The remaining £1,709 million of the main HIP allocations, made up of the £1,296 million of housing annual capital guidelines (ACGs) and £413 million of resources for specified capital grants, has been distributed in two stages. First, the distribution to DOE regions has been made in proportion to the sum of the GNI scores of the local authorities in each region. Second, each region's total has been allocated to individual local authorities one half in proportion to each authority's GNI score, and one half following recommendations by the Department's regional housing controllers to reflect local needs.