There is also a new ‘portfolio’ option under the CME route, which aims to support partners demonstrating delivery ambition for schemes that may be at different stages of delivery. Grant funding under the CME route is paid on achievement of applicable milestones.
Under the strategic partnership route, funding is offered on a long-term basis for partners with “ambition, capability and track record of delivering large numbers of new social and affordable homes”.
There are four options for becoming a strategic partner, including the existing model of registered providers delivering at scale, local authorities delivering in a single region, specialist and supported housing delivery, and developer-led delivery.
There are various requirements for the four routes, covering the minimum number of homes and an initial funding cap. Developer delivery strategic partnerships, for example, must deliver at least 1,500 homes by 31 March 2036 and funding will initially be capped at £250m.
Homes England requires all schemes, under both the CME and strategic partnership routes, to start on site by 31 March 2036 and complete by 31 March 2039. It will prioritise early delivery, with a particular focus on completions by 31 March 2039.
Providers bidding under the strategic partnership route may get the opportunity to apply for additional funding throughout the 10-year programme, depending on budget availability and their delivery performance.
Assessment criteria
All bids will be assessed on value for money, strategic fit and deliverability, and partners are expected to minimise the level of grant funding requested and maximise their own contribution.
Under the CME route, the value for money metric will be grant per home, whereas strategic partnership bids will be assessed using the benefit-cost ratio set out by the government. Strategic partnership bids will also be assessed on “a pass or fail basis”, which will entail Homes England looking at a provider’s previous track record, local relationships, and evidence of pipeline and planning status.
The government has announced that mayors in six combined authority areas will be able to “set the strategic direction” of the SAHP, including shaping the tenure mix and identifying priority sites.
Homes England said it will share information from bids with the relevant established mayoral strategic authorities (EMSA). But the guidance highlighted that the government agency will remain responsible for final funding and contractual decisions. It also said there is “no expectation that the SAHP will be able to support the delivery of all EMSA ambitions”.
Homes England encourages delivery of homes above minimum quality requirements
The guidance emphasised that all homes delivered using SAHP grant funding must meet relevant legislative, regulatory and planning policy requirements, such as Parts F, L and M of Approved Document building regulations.
But Homes England has encouraged partners to deliver homes above minimum requirements, and to share ideas around how SAHP funding can achieve quality and sustainability ambitions. Examples include considering how planned developments could have no ‘reds’ under the Building for a Healthy Life Standard, or how schemes can align with design principles in Homes England’s Healthy Homes Standard.
The prospectus stressed the importance of embedding equality, diversity and inclusion principles “across every stage” of development. Homes England said it expects all partners applying for SAHP funding to “demonstrate their commitment to inclusive practice in the design and delivery of their projects”.
Beyond compliance with equality legislation and robust policies around discrimination, Homes England said partners should focus on “treating communities, contractors and suppliers with dignity and respect”. It also said procurement and delivery processes should be “fair, transparent and inclusive”.
Flexibility to boost diversity of supply
The government has sought to recognise that some “much-needed” types of social and affordable homes often cost more to deliver, such as supported housing or council homes.
For this reason, and based on feedback from providers, the SAHP will have “flexibility on grant rates” to enable delivery of these more expensive homes. This means Homes England will not publish standard grant rates, noting the exception of the time-limited fast-track planning route in London as part of the emergency housebuilding package.
The agency will not publish national, regional or scheme type benchmarks, saying it is keen to support a “wide range of delivery from a diverse range of partners”.
Organisations applying to become a strategic partner will be able to bid for two grant rates per tenure, per region to support distribution across lower and higher cost schemes, according to the prospectus. Partners will also be able to combine grant funding with Right to Buy receipts when submitting bids for SAHP funding.