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Capital Funding Guide

Homes and Communities Agency
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1. Introduction

The Capital Funding Guide (CFG) sets out the policy and procedural requirements and guidance for organisations allocated grant funding under the Agency’s Shared Ownership and Affordable Homes Programme (SOAHP) on or after 1 April 2016.

1. Overview

1.1 Purpose

1.1.1 The Capital Funding Guide (CFG) sets out the policy and procedural requirements and guidance for organisations allocated grant funding under the Agency’s Shared Ownership and Affordable Homes Programme (SOAHP) on or after 1 April 2016. This version of the CFG supersedes all previous editions.

1.1.2 However, some of the requirements also apply to schemes funded under the Agency’s previous Affordable Homes Programmes including the 2011 to 2015 AHP and the 2008 to 2011 National Affordable Housing Programme (NAHP). Where this is the case it will be stated in the text, but users may wish to refer to previous versions of the Guide for the full requirements for schemes funded under previous programmes.

1.1.3 The CFG is produced predominantly for Registered Providers i.e. providers of social housing that are registered with the Social Housing Regulator. Please see the guidance below for details on registration.

Following the enactment of the Housing and Regeneration Act 2008, the Social Housing Regulator’s Register of Providers of Social Housing commenced on 1 April 2010. For information on who is eligible to become a Registered Provider and the registration requirements please refer to the website.

1.1.4 Many providers were previously Registered Social Landlords; however there will be other grant recipients who:

  • Were not previously Registered Social Landlords, but who have registered to become Registered Providers since the Regulator’s register was switched on in April 2010

  • Are not currently Registered Providers but intend to, or will be required to register with the Regulator before becoming landlords of grant funded social housing

  • Do not intend to become Registered Providers but who will be required to transfer any grant funded property to a Registered Provider upon practical completion

Please note that organisations that do not intend to become Registered Providers will still need to qualify as Investment Partners in order to deliver schemes under the SOAHP. For more details, please see the Funding Programmes section on the Agency website.

1.1.5 The product criteria detailed within the CFG, will be relevant to all the above organisations. Programme administration and management requirements will predominantly be intended for use by Registered Providers or those intending to become Registered Providers. Therefore the CFG will use the term ‘providers’. Providers must also refer to any specific requirements as set out in their Affordable Homes Grant Agreement – see Programme Management AHP 2015 to 2015.

1.1.6 All organisations delivering affordable housing under the SOAHP, including those who are not and do not intend to become Registered Providers, will be subject to an Affordable Homes Grant Agreement and will be required to be comply with the agreed contractual arrangements.

1.1.7 Unless otherwise stated, references to “grant” will refer to grant funding available under the Affordable Housing Programme either as:

  • Social Housing Assistance
  • Financial Assistance

Or for its predecessor programmes:

  • Social Housing Grant
  • Purchase Grant
  • Housing Association Grant

1.1.8 This Guide should be read in conjunction with the Affordable Homes Grant Agreement which sets out details of the government’s affordable housing provision, its new delivery model and details of the products that can be funded.

1.2 The Homes and Communities Agency’s powers

1.2.1. The Agency’s (the Agency) powers in relation to payment and recovery of grant are set out in legislation, and where legislation requires according to such terms and conditions as the Agency considers appropriate and/or principles determined by the Agency. The main types of funding are:

  • Social Housing Assistance payable under section 19(6) of the Housing and Regeneration Act 2008
  • Financial Assistance payable under section 19(3) of the Housing and Regeneration Act 2008

Historically grant has been payable as:

  • Social Housing Grant payable under section 18 of the Housing Act 1996
  • Purchase Grant paid under section 21 of the Housing Act 1996
  • Housing Association Grant paid under section 50 of the Housing Act 1988

1.2.2. The Agency’s terms and conditions for Financial Assistance (and Social Housing Assistance) provided under the SOAHP are set out in:

Note that for the 2015 to 18 AHP the requirement for providers to sign up annually to Funding Conditions is replaced by the 2015 to 18 Affordable Homes Grant Agreement. For providers delivering the remaining 2008 to 11 NAHP schemes separate arrangements will be put in place.

For remaining developments funded by Social Housing Grant, the Agency’s specifications are set out in a number of documents:

  • The 2008 to 11 National Affordable Housing Programme Prospectus
  • The Capital Funding Guide
  • The Funding Conditions
  • Programme Partnering Agreement
  • Grant Agreements
  • The Social Housing Grant (Capital) General Determination 2003

  • Following amendments to section 18 of the Housing Act 1996, principles are only to be determined in respect of section 18(7), relating to the proportioning of grant for properties transferred between ex-Registered Social Landlords. These principles are contained within clauses 37 and 38 of the determination, and supplemented in Procurement and Scheme Issues section 5. To access the determination, please see the archived CFG 2004.

1.2.3 The Agency’s Grant Recovery principles are contained in The Recovery of Capital Grants and Recycled Capital Grant Fund General Determination 2015. Although this determination refers to grants paid under both the Housing Act 1996, and the Housing Act 1988; by virtue of The Housing and Regeneration Act 2008 (Commencement No 7 and Transitional and Savings Provisions) Order 2010 (SI 2010/862) its scope includes funding under section 19(6) of the Housing and Regeneration Act 2008.

1.2.4 Although the Agency’s previous Determinations refer to RSLs, they should be read as referring to Registered Providers that were formerly RSLs prior to 1 April 2010. They do not apply to providers that were not formerly RSLs. References to the Housing Corporation, or the Corporation, should be read as referring to the Agency.

1.2.5 On 1 April 2012, the Agency assumed the regulatory functions formerly exercised by the Regulator of Social Housing, also known as the Tenant Services Authority. The Agency’s regulatory functions are carried out by a Regulation Committee, referred to in this Guide as “the Regulator”, which was formed following the Localism Act 2011. This committee has autonomy from the rest of the Agency in that the Act provides that the Agency may carry out its regulatory functions only through the Regulator. Enquiries about regulatory matters such as the accounting determination, consents, the Disposal Proceeds Fund, financial returns and the economic standards should be addressed to the Regulator. Contact points appear on the web pages relating to the Regulator.

1.3 Arrangements for outstanding 2008 to 11 NAHP schemes

1.3.1 The Agency has the power to pay grant as Social Housing Assistance under section 19(6) of the Housing and Regeneration Act; and under transitional arrangements (SI 2010/862) it retained its power to pay Social Housing Grant under the Housing Act 1996 in certain circumstances.

1.3.2 Bids received under the 2008 to 11 NAHP, allocated and part paid prior to 1 April 2010 grant will continue to be paid under section 18 of the Housing Act 1996.

1.3.3 Bids received under the 2008 to 11 NAHP and allocated prior to 1 April 2010, but not paid at that date will continue to be paid under section 18 of the Housing Act 1996.

1.4 Conversions

1.4.1 To encourage and enable the provision of more affordable homes the Agency allows providers that have included conversions in their programme offers to convert void social rent stock to:

  • Shared Ownership
  • Market sale disposal

Full details of conversion, which will be subject to Agency approval, are contained in the 2015 to 18 AHP Prospectus (please scroll down to bidding guidance). The impact of agreed conversions on recoverable grant is detailed in Grant Recovery 1.3.

1.5 Further information and contact

1.5.1. This Guide does not duplicate Agency requirements relating to the submission of Offers the requirements for which are set out in the SOAHP Prospectus, or Regulatory Standards which are available on the Agency’s website.

1.5.2. In many instances throughout this Guide it requires grant recipients to contact their operating area for further guidance or approval on investment matters. Unless specified otherwise initial contact should be made with the relevant contract manager. The contract manager should also be contacted regards other queries relating to the content of this Guide.

1.5.3 For general queries please contact the switchboard on 0300 1234 500. For IT or IMS queries, please contact the helpdesk on 01908 353 604.

1.6 Using the CFG

1.6.1 The content of the CFG is divided into requirements (i.e. what a provider has to do) and guidance (extra details and optional procedures). Requirements text appears in the main body of the page and guidance is shown in grey boxes or through links to attachments.

1.6.2 Through the CFG there are also links to external websites. These links are here to provide additional guidance material which may be useful to read in conjunction with the Guide.

1.6.3 Whilst all links should take you to the intended destination, the Agency cannot guarantee that external organisations have not changed URLs and as such on the odd occasion you may find some links are not functionary. If you identify any such links please contact the Agency via the details in section 1.5.3 above.

2. Updating

2.1 General

2.1.1 The CFG will be regularly updated to reflect new and amended legislation, policy, requirements and guidance. For this reason providers are strongly discouraged from printing hard copies version. Updates will be made to the relevant text and a notification and brief explanation published in the New Announcements. Updates to correct any minor typing oversights or similar will not be announced.

2.2 Previous versions of the CFG

2.2.1 Various versions of past guides are available on the CFG Library page. Since August 2009 the Agency has used The National Archive library for this purpose and the library page contains the appropriate link. Once on The National Archive site its banner headline contains a further link to access the most recent archive versions.