EXCLUSIVE: Councils offered second chance to claim housing cash

By Dan Peters | 22 February 2024

Civil servants have issued a last-minute invitation for councils to claim cash from a fund that has suffered from poor take up by local authorities.

Councils were last month given just two weeks to submit an expression of interest to claim ‘potential underspend’ from the £750m Local Authority Housing Fund (LAHF), which aims to help English local authorities obtain housing for those fleeing conflicts.

Local authorities were told that any underspend that was claimed would have to be ‘committed’ before the end of March.

A senior local government source said: ‘This proves there must be a high probability if not certainty of underspends on LAHF.

'Why else would the Department for Levelling Up, Housing and Communities (DLUHC) invite expressions of interest for money that has to be spent by the end of March?’

It was revealed last year that tens of millions of pounds from the initial £500m of the fund had not been taken up by councils, many of which rejected the cash either because they thought the conditions imposed were unfair or because they did not want to prioritise refugees over their existing residents.

One senior officer whose council rejected the funding said: ‘It was unrealistic to expect councils that don’t have their own housing stock to find 60% of the cost from hard-won capital receipts or by taking out borrowing.

'Helping the Government with a problem it has created would either scupper other worthwhile capital projects or add to revenue pressures.

'DLUHC should have realised that a grant rate much closer to 100% was needed if all councils were going to take part.’

Allocations for just £52.5m (21%) of the £250m second round of the fund have been announced so far, with DLUHC currently declining to disclose what will happen to the rest of the money.

DLUHC said it did not have ‘live data’ on how many homes had been acquired thanks to the LAHF but it would ‘ask local authorities to report on occupation of the homes as part of the programme evaluation process, which will begin after the programme has concluded’.

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