Housing Secretary Addresses Lloyds’ Social Housing Forum: Key Insights and Future Directions

It is a pleasure to return to Coin Street, located in my former constituency of Lambeth, where I once served as council leader. Here, I am surrounded by individuals who are actively contributing to the creation of a brighter future.

I would like to extend my gratitude to everyone at Lloyds, especially you, Charlie, for orchestrating such a remarkable event and for uniting those who are making significant strides in the realm of social housing.

The collaborations we witness here are fundamental to our collective efforts to address the ongoing housing crisis. Central to this initiative is the Small Sites Aggregator, a project developed in collaboration with many of you present today. I am pleased to announce that we will be expanding this initiative across the country following the completion of the current pilot.

Government Support for Housing Initiatives

Reflecting on the government’s role in supporting your work, I was encouraged to learn that social housing starts have once again risen. Homes England and the Greater London Authority have doubled the number of homes earmarked for social rent under this Government.

The policies implemented in the 1980s had a detrimental impact on both social and council housing, aimed at reshaping communities in a way that ultimately backfired. Housebuilding plummeted while the benefits bill escalated significantly.

Over the past two years, our government has made concerted efforts to reverse this trend, and I am heartened to observe that these plans are beginning to yield results. While we support home ownership, it is imperative that this does not come at the expense of the social housing that our country sorely requires. Good and decent social homes are not merely a component of the housing mix; they provide essential security for residents in the communities of Britain.

Commitment to Increasing Social Housing

We are committed to the largest increase in social and affordable housing in a generation, providing robust support to councils and housing associations to enable them to build on a significant scale. However, we also recognise the need for improvements to existing housing stock, and I am dedicated to empowering residents with greater control over their homes and estates.

During my ten months in this role, I have collaborated with many of you to tackle the housing crisis, and I am proud of the progress we have made thus far. Our approach is guided by a five-step plan aimed at fostering a decade of renewal:

Firstly, we are delivering the most substantial boost to grant funding in a generation. Secondly, we are focused on rebuilding sector capacity. Thirdly, we are implementing an effective and stable regulatory framework. Fourth, we are revitalising council housebuilding. Finally, we are strengthening partnerships within the sector.

Addressing the Housing Shortage

We have made substantial progress across all these areas, and it is crucial that we continue to pursue our objectives. Our commitment to enhancing social housing is tangible, as demonstrated by a significant long-term increase in grant funding.

The decline of our social and council housing stock has had devastating consequences for families and taxpayers alike. Currently, there are 134,000 households residing in temporary accommodation, resulting in considerable social costs that burden taxpayers by billions. Additionally, over a million families are on council housing waiting lists, with the housing benefits bill nearly doubling since 2010.

Taxpayers are financing tens of billions in benefits to subsidise private landlords who are renting homes that taxpayers themselves funded. Alarmingly, over 40% of homes sold under the right-to-buy scheme are now let out in the private sector, often at rents that are two to three times higher than when they were council homes, with taxpayers covering the difference.

Transforming Housing Policy

Our Government has initiated efforts to reverse this concerning trend. The core of our strategy is the straightforward principle that it is more prudent to allocate taxpayer funds towards the construction of new homes rather than subsidising buy-to-let landlords. We are undertaking a comprehensive reform of the right-to-buy scheme to safeguard our social housing stock and prevent the sale of newly constructed homes.

While we recognise the aspirations of tenants who wish to own their homes, we equally support the more than one million individuals on council waiting lists who are in need of affordable and decent housing.

We are working to restore the capacity of councils and registered providers that have faced significant challenges due to austerity measures and inflation. Our commitment includes a record investment of £39 billion through the Social and Affordable Homes Programme, aimed at achieving the largest increase in social and council housing in a generation, with a target that at least 60% of these homes will be for social rent.

Innovative Financing for Social Housing

We are witnessing ambitious plans for delivery across the sector, with construction already underway. Council housebuilding is currently at its highest level in 25 years, thanks in part to the £2 billion funding announced in March 2025, which is facilitating a swift transition from proposal to construction.

An exemplary project in York, spearheaded by the Joseph Rowntree Foundation, is set to deliver 117 homes, with 60% allocated for social rent. Furthermore, we are promoting innovative financing models for social housing, such as the Small Sites Aggregator, which aims to establish new partnerships to build homes for social rent. We have also articulated our ambition to scale this model into a national programme, targeting the construction of 10,000 homes annually by the conclusion of this Parliament.

Strengthening Housing Associations and Councils

This level of ambition and innovation is only achievable through close collaboration between the public and private sectors. We are always open to exploring new investment ideas that align with our core principles and committed to working alongside you to enhance the supply of homes for social rent and create sustainable communities for the long term.

Our new investment initiative is just one facet of our plan to increase housing supply; we also need to bolster the sector’s ability to borrow and invest. Factors such as building safety requirements, rising costs, and real-term rent reductions have weakened the capacity of housing associations and councils, and our Government is determined to reinforce this.

In conjunction with grant funding, we are introducing targeted reforms. We have established a ten-year rent policy allowing landlords to raise rents annually by CPI+1%, alongside provisions for additional increases for those below the formula. Furthermore, we have ensured equal access to government remediation funding schemes, with over £1 billion allocated for new investment between 2026-27 and 2029-30, as well as offering £2.5 billion in low-interest loans to Private Registered Providers to facilitate the delivery of more homes.

Ensuring Quality and Safety in Housing

Local authorities play a pivotal role in our ambitions, and to invigorate council housebuilding, we are focused on rebuilding skills and capacity. We have also extended the preferential borrowing rate from the Public Works Loan Board for council housebuilding until March 2027, providing councils with greater certainty in their supply plans.

Through the Social Housing Bill, we will safeguard our vital social housing stock by reforming the right-to-buy scheme to prevent homes from being sold off at a pace that exceeds the rate of replacement. Our vision for social housing extends beyond mere numbers; we aim to achieve lasting improvements in safety and quality.

We are advancing the new Decent Homes Standard to offer long-term regulatory certainty to the sector. Additionally, we are backing strategic business planning and investing in stock enhancements alongside new supply. We are attentively considering feedback from the sector regarding deliverability and will publish guidance on quality regulations later this year.

Empowering Residents in Social Housing

My aspiration for the future of social housing is for residents to enjoy greater autonomy over their homes and the estates in which they reside. I am eager to engage with landlords to explore how we can collaborate effectively. Homeowners like myself have the privilege of choosing who conducts repairs and the standards to which they are performed; I believe that the same respect and dignity should be afforded to social housing tenants.

Our new Right to Manage initiative will empower residents to take charge of their housing management if their social landlord fails to enhance substandard services. In addition, our Social Housing Innovation Fund has already supported 20 projects aimed at increasing tenant influence.

I am keen to ensure that housing association tenants also benefit from these initiatives, and we will be initiating a consultation to gather ideas on how best to facilitate this. Through the Social Housing Resident Panel, we will continue to engage with residents directly as we develop and implement our policies.

A Vision for the Future of Housing

While I take pride in what we have accomplished thus far, we must acknowledge that meeting residents’ expectations is only the beginning. Our subsequent efforts must focus on increasing both the quantity and quality of housing while ensuring that residents have a voice in decision-making.

Building a stronger nation is contingent upon fostering resilient communities where opportunities are accessible to all. We cannot achieve this goal without providing the necessary housing for individuals and families to thrive. This entails the largest increase in social and council housing that our country has witnessed in a generation.

To all present today, you are not merely constructing homes; you are nurturing hope—hope for independence from parental households, hope for gardens where children can play, and hope for a future free from the cycle of temporary accommodations.

It is truly commendable to dedicate your