Since coming to office the Government have made clear that our most urgent priority is to tackle the UK’s record deficit in order to restore confidence in our economy and support the recovery. Throughout the spending review the Government have been guided by a commitment to fairness, protecting the most vulnerable people in our society and as far as possible protecting front-line services. In DCLG, that commitment includes continuing to fund the decent homes programme.

The spending review announced that the Government will invest over £2 billion of capital funding to help towards completing the decent homes programme. Of this, funding of £1.595 billion is available over the next four years to help make local authority social homes decent (with an additional £0.510 billion being provided for “gap” funding existing stock transfers). We will be working with the Homes and Communities Agency to ensure that decent homes funding is allocated where it is needed and in order to support the self-financing settlement.

The coalition Government wish to be fair in their approach to all, so we will not be as rigid about local structures as the last Government. This funding will help ensure that all councils can deliver a sustainable 30-year business plan under self-financing. It would therefore not be appropriate to restrict access to funding on the basis of current organisational structure or performance. We will therefore open the process of allocation of funding for the period 2011-15 to all local authorities who have a significant backlog of decent homes work. This Government consider that the two-star rating is not in itself a guarantee of ability to run a capital programme, or of good value for money; there will, therefore, be no requirement for a two-star housing inspection standard to be achieved to access funding. This is also unfair to tenants who have little control over the star rating of their landlord, but are currently made to suffer a potentially un-decent home as a result. In future it will be up to councils whether they want these inspections to go ahead reflecting the Government’s commitment to reduce regulatory burdens on local authorities.

Today, we are jointly publishing with the Homes and Communities Agency (HCA) our proposals for managing the allocation process in a consultation document and welcome the views of local authorities, arm’s length management organisations and other interested parties on how we propose to gather information and make fair funding decisions. A copy has been placed in the Library of the House.