Burnham’s plans for council housing revival will fail without major funding at budget

At next year’s spending review, the chancellor must announce an extra £7bn for council housebuilding over the next three years, adding to the £1.5bn announced at the autumn budget, if the government is to get on track to meet Andy Burnham’s ambitions for council housing, according to a report published today by the New Economics Foundation (NEF).

Andy Burnham has pledged to oversee ​“the biggest council housebuilding programme since the post-war period”. The 10-year social and affordable homes programme (SAHP) launched last year to distribute £39bn (now raised to £40bn) in grant funding for social and affordable housebuilding, aiming to build an average of 18,000 social homes a year over the next decade. But housing experts such as Shelter, Crisis, and NEF say that England needs 90,000 new social homes a year to meet demand for social housing.

Today’s report finds that with an extra £7bn of programme funding by the end of the spending review period (on top of Wednesday’s announcement), and with more funding spent earlier in the programme, SAHP could fund over 100,000 new council and social homes by 2030 – almost two-thirds more than current targets. This rate of growth would put England on track to building the 90,000 council and social homes a year that experts say are needed to meet demand, by 2032 – 33.

The number of households waiting for a social home has grown every year since the pandemic, hitting 1.3 million in 2025 – an 18% increase in just five years. Without more public money, social housebuilding will remain dependent on profits from private development, meaning that when economic conditions are poor for private developers, the UK will also struggle to build new social homes.

Molly Harris, senior researcher at NEF, said:

“Investing in new social homes is our only way of solving the housing crisis for good. Households stuck on waiting lists are facing overcrowding, rent they can’t afford, or a years-long stay in temporary accommodation. The prime minister clearly understands the importance of social homes, with councils at the forefront, but this month’s budget and next year’s spending review need to back this up with hard cash.”

Today’s recommendations will require significantly more government spending in a fiscally constrained environment. But the report finds that more council homes will also cut the cost of housing benefit and government fees to landlords operating emergency accommodation. Building publicly owned housing will also give the government a stake in a public asset and in any increases in the value of the land it is built on, easing the government’s balance sheet challenges.

Notes

The New Economics Foundation is a charitable think tank. We are independent of political parties and committed to being transparent about how we are funded.

The report Investing in social housing, will be available at https://​newe​co​nom​ics​.org/​2​0​2​6​/​1​0​/​i​n​v​e​s​t​i​n​g​-​i​n​-​s​o​c​i​a​l​-​h​o​using 

Statistics on social housing waiting list are from: Ministry of Housing, Communities and Local Government. (2026, June 25). Live tables on rents, lettings and tenancies (Table 600). GOV​.UK. https://​www​.gov​.uk/​g​o​v​e​r​n​m​e​n​t​/​s​t​a​t​i​s​t​i​c​a​l​-​d​a​t​a​-​s​e​t​s​/​l​i​v​e​-​t​a​b​l​e​s​-​o​n​-​r​e​n​t​s​-​l​e​t​t​i​n​g​s​-​a​n​d​-​t​e​n​a​ncies

NEF calculates its proposed ramp-up of SAHP grant funding for social and affordable housing using grant rate assumptions derived from initial SAHP allocations and AHP grant rates for London and tenure-specific estimates. While London grant rates are being negotiated, the model uses rates from the Accelerated Funding Route Guidance (2025) as an estimate. Rest of England grant rates are calculated based on AHP 2021 – 2026 transparency data and August 2026 allocations. Social home figures include council and housing association delivery, as the model applies the same social grant rates regardless of provider.

Our illustrative scenario for an additional £8bn in CDEL funding on top of the pre-autumn budget SAHP baseline, by 2029 – 30, is based on continuing the average annual rise in social housing completions between 2022 – 23 and 2025 – 26 (35% per year), over the next few years to 2032 – 33. This is a very ambitious scenario given constraints on construction capacity. This profile of funding allows social housebuilding to reach 40,000 per year in 2029 – 30 and 90,000 per year by 2032 – 33. It would fund a cumulative 105,000 social homes in the years up to and including 2029 – 30, and 590,000 across the lifetime of the SAHP.

Figures show homes funded, not homes completed, as estimating delivery timelines is highly context dependent; the model treats funding and completion as occurring in the same year while in practice grants typically take two to four years to translate into completion.