6. Programme Management

This chapter sets out the contract terms, key milestone requirements, scheme administration and reporting requirements that providers need to meet. It also provides information on the key elements of the Affordable Homes Programme 2021 to 2026 for providers bidding for funding through the Continuous Market Engagement route.

1. Overview

There are elements of this Programme Management chapter that are in the process of being updated to take account of the new AHP 2021 to 2026 contracting process and other changes. It is expected that this will be completed by the end of June 2020.

1.1 Purpose

1.1.1 This chapter sets out our requirements in relation to management of a provider’s approved allocation funded through one of our affordable homes programmes.

1.1.2 Approved bids (accepted offer lines in IMS) for the Affordable Homes Programme (AHP) 2021 to 2026 are subject to a AHP 2021 to 2026 contract. For further information see section 2 below. Throughout the Capital Funding Guide the AHP 2021 to 2026 contract is referred to as ‘the contract’.

1.2 Investment Management System (IMS)

1.2.1 All providers who have received an allocation for Homes England funding or an agreement to deliver nil grant units will be required to manage their programme of schemes via our Investment Management System (IMS).

1.2.2 For details on how to access and use IMS please refer to the IMS page on Homes England’s website, or contact the helpdesk on 01908 353 604.

1.3 Conversions

1.3.1 The conversion of void Social Rent stock to Affordable Rent to generate additional financial capacity to support providers’ AHP 2021 to 2026 programmes is no longer allowed and does not form part of the AHP 2021 to 2026 contract. Providers should operate in line with the Government’s Policy statement on rents for social housing and the Regulator of Social Housing’s Rent Standard.

1.3.2 For previous programmes where such conversions formed part of the programme, providers should refer to the relevant bidding guidance / Prospectus or the relevant contract. The impact of agreed conversions on recoverable grant is detailed in Grant Recovery 1.3.

1.4 Homes England’s powers

1.4.1 Homes England’s 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 we consider appropriate and/or principles determined by us. 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

1.4.2 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

1.4.3 Our terms and conditions for Financial Assistance (and Social Housing Assistance) provided under the SOAHP 2016 to 2021 and AHP 2021 to 2026 are set out in:

2. Investment Partner Qualification and the Affordable Homes Programme 2021 to 2026 Grant Agreement

2.1 Investment Partner Qualification (IPQ)

2.1.1 All organisations delivering homes through the  AHP 2021 to 2026 and associated affordable housing programmes (including the Move On Fund, Rough Sleeping Accommodation Programme, and Care and Support Specialised Housing Fund) must be a qualified Homes England Investment Partner (IP). Organisations need to either apply for qualification in their own right or join with an existing qualified IP as a consortium member (see section 2.2 below). This does not need to be achieved ahead of bidding but does need to be achieved before any grant can be paid.

2.1.2 For more details on the process and how to apply, see Homes England’s Investment Partner Qualification application forms and guidance.

2.1.3 Homes England reserves the right to remove Investment Partner status at any time if the criteria by which the partner was measured in their original application has changed. For details of the events and circumstances that might lead to Homes England removing Investment Partner status, see our Investment Partner Qualification guidance.

2.2 Consortium arrangements

2.2.1 Where providers have formed a consortium to deliver a programme of affordable homes, one provider must undertake the role of consortium lead. The consortium lead is expected to work closely with other consortium members to deliver the anticipated supply throughout the contract period.

Consortium leads are the initial recipient for our grant and are responsible for collating and providing information to us at any review meeting held by Homes England. They also have additional responsibilities and obligations on behalf of the other members as outlined in the contract.

2.2.2 Consortium leads must also be qualified as a Homes England Investment Partner but there is no requirement for consortium members to separately qualify. See Homes England’s Investment Partner Qualification application forms and guidance.

2.3 The Affordable Homes Programme 2021 to 2026 Grant Agreement

2.3.1 All grant recipients and providers wishing to deliver new affordable homes through the AHP 2021 to 2026 are required to enter into a new supply Grant Agreement (contract) with Homes England. There are different contracts for different types of provider and whether programmes are being delivered through the Continuous Market Engagement (CME) or Strategic Partnership route.

2.3.2 The contract is a standard form contract that will be applied by Homes England to all AHP 2021 to 2026 providers. There will be a number of variations to reflect the specific nature of the grant recipient (e.g. Registered Provider, Local Authority or unregistered body) and/or to reflect consortium arrangements. See the Grant Agreement examples for the Affordable Homes Programme 2021 to 2026.

2.3.3 For homes still to be delivered through the SOAHP 2016 to 2021 (and any previous programmes if relevant) then the provisions within these respective contracts still apply.

Please find below some key elements of the AHP 2021 to 2026 contract.

2.4 Indicative schemes

2.4.1 Providers are only able to submit indicative offer lines to Homes England for either Home Ownership for people with long-term disabilities (HOLD) or for Empty Homes (Lease and Repair) schemes. This is to allow for providers to submit bids for funding prior to any schemes being identified but where they are confident of doing so in the future.

Indicative proposals are where providers are not yet in position to be able to give precise scheme details required for schemes to be considered firm, such as a post code, x/y co-ordinates and details of ownership or control by the bidder.

2.4.2 As per the requirements of the AHP 2021 to 2026 funding agreement, providers should use all reasonable endeavours to identify firm schemes for submission to Homes England.

2.4.3 If firm schemes are not forthcoming within what Homes England considers a reasonable timescale and / or as agreed through the funding agreement then Homes England reserves the right to either reduce or withdraw indicative allocations. The same will apply if any other requirements of the funding agreement are not met.

2.5 Building Safety

Please refer to the AHP 2021 to 2026 contract for more detail

2.5.1 Where any home funded through the AHP 2021 to 2026 forms part of a building that is above either 18 metres or six floors in height (whichever is the lower), providers must register as a signatory to the Building a Safer Future Charter. This sets out a list of build environment safety values for housebuilders to comply with ahead of all other building priorities. This may be amended or updated from time to time and providers will be expected to abide by any such changes.

2.5.2 Providers will also be expected to meet the requirements arising out of any building safety legislation that is enacted during the AHP 2021 to 2026. In particular with reference to legislation from the draft Building Safety Bill 2021. Providers will also need to comply with any legislation, regulations and guidance issued by any Regulatory Body which is in force and / or applies in England in relation to building safety.

2.5.3 If all relevant building safety requirements are not met then Homes England may withhold grant payments accordingly.

2.6 Health and safety

Please refer to the AHP 2021 to 2026 contract for more detail. See also the Finance chapter of this guide, section 2.1.4.

2.6.1 All providers in receipt of grant funding through the AHP 2021 to 2026 will need to comply in all material aspects with all relevant legislation relating to health and safety, welfare at work, equality and diversity, modern slavery and other relevant employment matters. Providers will also be expected to use reasonable endeavours to ensure that all parties engaged in the delivery of schemes do likewise.

2.6.2 It is also a requirement that providers abide by all policies covering equal opportunities designed to ensure that discrimination prohibited by the Equality Act 2010, or which is made on any other unjustifiable basis, is avoided at all times. Homes England reserves the right to request a copy of any policy and evidence of the actual implementation of that policy.

2.6.3 Providers shall also have due regard to the public sector equality duty under Part 11 of the Equality Act 2010.

3. Scheme administration and data collection

3.1 Offer capture

3.1.1 A provider’s offer may consist of any number of offer lines (bids). Each offer line represents an individual firm scheme or, in the case of indicative proposals, delivery of a given number of homes within a certain area. Each offer line within the offer will have its own funding requested amount which will be the grant required to deliver that particular offer line agreed with us through the bid assessment and allocation process. This amount will be paid in agreed tranches on the achievement of milestones. Please see section 4.

3.1.2 Decisions will be made on an offer line basis, not for whole offers. A provider may therefore receive an allocation for some, all or none of their offer lines.

3.2 Updating profiles and scheme processing

3.2.1 When ready to deliver an agreed firm scheme, the provider must update the details in the scheme profile including complete scheme cost information and then create the scheme on IMS, which should be submitted to the relevant lead contact in Homes England’s Provider Management team for review and approval. Once approved the scheme is eligible for grant payment at start on site (for Registered Providers and unregistered bodies who have agreed a start payment with us and eligible scheme types). For other providers and scheme types grant is paid 100% on completion. For further details on scheme types please see Procurement and Scheme Issues chapter.

3.2.2 Providers who have received indicative allocations must have input the firm schemes in accordance with the provisions as set out in their AHP 2021 to 2026 contract. Note that indicative allocations are only relevant in the AHP 2021 to 2026 for Home Ownership for people with long-term disabilities (HOLD) and Lease and Repair schemes.

3.2.3 Please see the IMS help page for guidance on updating profiles and schemes.

3.2.4 Not less than five days prior to a scheme reaching the start on site milestone (please see 4.2.2), providers are obliged by the contract to have submitted details of the scheme to us via IMS. However, owing to the practicalities of achieving this, especially where providers have large numbers of schemes starting on site, we have agreed that in exceptional circumstances details may be submitted up to 30 business days after start on site has been achieved.

3.3 Submission requirements

3.3.1 Providers’ programmes must comply with the contract, which contains all our requirements.

3.3.2 Providers must submit the required information on to IMS prior to claiming grant. For details please see the IMS: guidance documents and training.

3.3.3 Providers must submit the following data in relation to the milestones on to IMS following confirmation of their allocation. Please note that not all milestones will necessarily apply to all schemes (please see section 4 for details):

Planning consent
Development contract (off the shelf only)
Acquisition of land
Start on site date
Final cost (practical completion)

3.3.4 Providers must review and confirm acceptance of the on-screen certifications.

3.3.5 Detailed guidance on how to input data on to IMS is provided on the IMS help page.

3.4 Scheme cost information

3.4.1 Homes England collects scheme cost information, in respect of the following areas:

Acquisition cost
Works cost
On cost

3.4.2 Only certain types of expenditure are eligible for funding in each of these cost areas. The contract refers to actual development costs, meaning the expenditure actually incurred in developing the firm scheme units, as opposed to the projected expenditure. Public sector subsidy (i.e. grant plus all other public funding) must not exceed the actual development costs.

3.4.3 For acquisition costs, funding is available in respect of the purchase price of land / property and Stamp Duty Land Tax on the purchase price of the land / site.

3.4.4 For works costs, funding is available in respect of the following:

Main works contract costs (excluding any costs defined as on costs)
Major site development works (where applicable). These include piling, soil stabilisation, road/sewer construction, major demolition
Statutory agreements, associated bonds and party wall agreements (including all fees and charges directly attributable to such works) where applicable
Additional costs associated with complying with archaeological works and party wall agreement awards (including all fees, charges and claims attributable to such works) where applicable
Irrecoverable VAT on the above, where applicable

3.4.5 For on costs, funding is available in respect of the following:

Legal fees and disbursements
Net gains/losses via interest charges on development period loans
Building society or other valuation and administration fees
Fees for building control and planning permission
Fees and charges associated with compliance with European Union directives
In-house or external consultants’ fees, disbursements and expenses (where the development contract is a design and build contract)
Insurance premiums including building warranty and defects/liability insurance (except contract insurance included in works costs)
Contract performance bond premiums
Borrowing administration charges (including associated legal and valuation fees)
An appropriate proportion of the provider’s development and administration costs
Irrecoverable VAT on the above, where applicable

Funding is not available for any type of compensation payments to residents moving out of, or being decanted from, homes to be replaced due to regeneration.

3.4.6 Where the development contract is design and build, the on costs may include the builder’s design fee element of the contract sum. The amount included by the builder for design fees should be deducted from the works cost element referred to above, as should other non-works costs that may be submitted by the builder such as fees for building and planning permission, building warranty, defects liability insurance, contract performance bond and energy rating of dwellings.

3.4.7 Similarly, other non-works costs that may be included by the builder such as fees for building and planning permission, building warranty and defects liability insurance, contract performance bond and energy rating of dwellings should also be deducted from the works cost element submitted by the provider to us.

3.4.8 For Strategic Partnerships the following expenditure is not eligible:

Loans
Monies held in escrow
Cost of option agreements

3.4.9 Homes England collects scheme data on a regional basis against areas defined as the standard regions of England (excluding London). These eight regions, including the local and unitary authorities within each, can be found in this list of local and unitary authorities by region (PDF, 319kb) from 1st April 2021.

4. Milestones

4.1 General

4.1.1 The progress of programmes and schemes will be monitored against a series of milestones as detailed below. Milestones consist of the milestone event and the milestone date that the milestone event is forecast to take place. The contract refers to forecast dates as milestone dates, but this section of the CFG will use the term forecast date, in line with IMS. Not all milestones are mandatory for all schemes, and the number of milestones will depend of the type of scheme being developed.

4.1.2 A milestone refers to each stage in the delivery of the firm scheme agreed by the parties and as set out in IMS (including a start on site and completion date). Milestones have two functions:

To monitor performance (i.e. the provider’s reliability in predicting programme/scheme progress)
To trigger liability to pay grant (provided that no other fundamental changes in provider status have occurred at the time of a claim), which may be discharged by either payment of grant during that financial year, or raising a year-end accrual

4.1.3 The liability to pay grant is triggered by an agreed forecast date of a grant payment event in IMS

4.1.4 Homes England uses a defined set of milestones, shown in the table below. All products bid for will have at least one milestone to forecast.

Some milestones trigger payments
Some non-payment milestones are not required for all schemes, depending on the programme under which they are funded

Milestone	Relevant products	Triggers Payment?	Creates countable output?
Acquisition of land	All (excluding Social HomeBuy, HOLD, Leasehold Repurchase, and Off The Shelf purchases)	Is equivalent to 40% of the firm scheme grant. This payment tranche can only be claimed where providers have expended money in acquiring the land. For Registered Providers qualifying for payment flexibility this will be up to 95%.	No
Planning Permission	All (excluding Social HomeBuy, HOLD, Leasehold Repurchase, and Off The Shelf purchases)	No	No
Start on site	All (excluding Social HomeBuy, HOLD, Leasehold Repurchase, and Off The Shelf purchases)	Is equivalent to 35% of the firm scheme grant (where an acquisition tranche has been claimed). Where no acquisition tranche is being claimed it is 75% of the firm scheme grant. For Registered Providers qualifying for payment flexibility this will be up to 95% and providers must have expended eligible development costs up the % they are claiming in order to receive payment.	Yes
Practical Completion (PC) / Final Cost	All	Is equivalent to 25% of the firm scheme grant. 100% for schemes with a practical completion payment only. For Registered Providers qualifying for payment flexibility this can be a minimum of 5% (if they have claimed 95% at Acquisition or Start on Site.	Yes
Exchange of contracts (please note this applies to purchase contracts rather than build contracts)	Social HomeBuy and HOLD	100% of grant (Paid at final cost milestone)	HOLD (Yes), Social HomeBuy (No)

4.2 Definitions

4.2.1 Acquisition of land

Acquisition of land is a payment milestone that triggers payment of 40% of the grant. To claim grant for the acquisition of land a provider must have an unconditional secure legal interest in the land (freehold or long leasehold). Please refer to the Finance chapter of this guide, section 3.1.1 for more detail on secure legal interest requirements. Providers cannot claim grant in advance of need. Where providers have a conditional interest, such as the exchange of acquisition contracts, they will not be able to claim grant for the acquisition of land.

4.2.2 Planning permission

There are two types of planning permission – outline and full planning permission. Outline planning permission gives an indication of permitted development but may be subject to full planning permission being obtained before building can commence. Full planning permission must be submitted within a specific time limit normally three years from the date outline planning permission was granted.

In order for a provider to achieve the planning consent milestone in IMS full planning permission must have been received.

4.2.3 Start on site

The start on site or first tranche grant claim, which applies as a payment event only to eligible schemes delivered by eligible providers where start on site is achieved, is triggered by the date when:

The provider and the building contractor have entered in to a building contract
The building contractor takes possession of the site or property
The works have commenced

Registered Providers

This will trigger payment of 35% of the grant where an acquisition tranche has been received. Where no acquisition tranche is claimed this will trigger a payment of 75% of the grant.

Unregistered Bodies

Unregistered bodies may choose between:

receiving 100% of the funding at practical completion of the scheme
receiving 40% at acquisition, 35% at start on site (75% if no acquisition tranche claimed) and 25% upon practical completion and offering one or both of the forms of security accepted by Homes England set out below.

4.2.3.1 For unregistered bodies receiving grant from Homes England through the AHP 2021 to 2026 and associated Affordable Homes Programmes via either the CME or Strategic Partnership route security is defined as follows.

A Payment Guarantee to an agreed limit supplied by an approved Guarantor to secure the grant during the development period and;
For those organisations retaining ownership of Shared Ownership homes, a contractual obligation to apply a restriction on title in favour of Homes England

Payment Guarantee

4.2.3.2 Where a Payment Guarantee is to be arranged this will, in most circumstances, be given by a parent company. Depending on circumstances, other companies can be accepted as Guarantors including a third party commercial entity or local authorities for smaller organisations that may not have a parent company.

4.2.3.3 A Payment Guarantee arranged will include a Secured Amount which will limit the maximum amount of grant exposure permitted at any one time and must reflect the grant allocation agreed and an organisation’s delivery pipeline projections up to the end of March 2026. Claims made for acquisition and / or start on site payments for allocated offer lines will count against the Secured Amount. Once an allocated offer line has been paid at the practical completion milestone stage, the grant liability transfers to the recipient Registered Provider landlord and no longer counts against the Secured Amount of the Payment Guarantee.

4.2.3.4 Both the Guarantor and the proposed Secured Amount are subject to Homes England’s satisfaction as to the Guarantor’s financial and commercial good standing, the strength of the proposed financial covenant and the Guarantor not being a prohibited person. This will include satisfying Homes England’s Know Your Customer due diligence process.

4.2.3.5 A template Payment Guarantee is set out in more detail in Homes England’s Example of an Unregistered Body agreed transfer Grant Agreement for the AHP 2021 to 2026 at Schedule 13.

Homes England restriction on title

4.2.3.6 Where unregistered bodies wish to retain ownership of Shared Ownership homes in the future there is a contractual obligation for a restriction on title to be applied in favour of Homes England.

4.2.3.7 This requirement will be reflected in the AHP 2021 to 2026 retained ownership form of Grant Agreement for unregistered bodies, and also the Deed of Adherence for the Agreed Transfer model where the recipient landlord and long-term owner of any grant funded homes is to be an unregistered organisation.

4.2.4 Start on site works are defined as:

a) Excavation for strip or trench foundations or for pad footings

b) Digging out and preparation of ground for raft foundations

c) Vibrofloatation, piling, boring for piles or pile driving

d) Drainage works specific for the buildings forming part of the firm scheme or

e) Such works of demolition or service diversion as are expressly and strictly contemplated (please see Finance - Grant claims and payments).

4.2.5 It is not intended that the definition of start on site works in the grant agreement excludes schemes where demolition works have begun or where infrastructure works (such as excavations to install drainage or highways infrastructure works including where such works are the subject of a section 278 or section 104 agreement) to support the scheme have commenced, subject to the conditions below. Starts on site can therefore be recorded (and where relevant a grant claim submitted) in circumstances where:

Either:

a) A building contract has been signed and dated with a single building contractor to undertake both demolition and construction works or infrastructure and construction works

b) Demolition or infrastructure works have commenced

c) Upon completion of demolition works and site clearance, or of infrastructure works, construction works which meet one of the given above (4.2.4 a-e) will immediately follow on

d) A separate contract for demolition works or for infrastructure works has been signed and dated and a building contract with a building contractor has been signed and dated

e) Demolition works or infrastructure works have commenced

f) Upon completion of demolition works and site clearance or upon completion of infrastructure works, the building contract with the building contractor will be unconditional; and as soon as the building contract becomes unconditional, start on site works which meet one of the definitions in 4.2.4 will proceed

4.2.6 Start on site may occur before a provider has completed purchase of or acquired a leasehold interest in the site. In these circumstances, the provider will need to have a building agreement/licence in order to claim grant. Please see Finance 3.5 for further information

4.2.7 Practical completion

For grant purposes practical completion is when the last dwelling is handed over, the scheme having been completed in accordance with the terms of the relevant building contract and the terms of the contract, as being fit for occupation as a residential development, in accordance with the relevant certifications and requirements. The relevant certifications and requirements will be dependent on the type of scheme (see 4.2.7.1 below). This excludes minor defects and / or minor omissions at the time of inspection which are capable of being made good or carried out without materially interfering with the beneficial use and enjoyment of the scheme. For instance, a scheme can be classed as completed even though external works such as landscaping may remain to be completed.

There are additional requirements in respect of schemes constructed using Modern Methods of Construction (MMC) - please see Procurement and Scheme Issues 3.5.

4.2.7.1 For new build schemes the property must by covered by either a guarantee or similar warranty products provided by a reputable organisation. An architect’s certificate or any other professional consultant’s certificate is not acceptable.

For rehabilitation schemes there must be a full survey carried out by a building surveyor with an appropriate RICS qualification prior to start of works, identifying works required to ensure the building’s longevity is appropriate for the funding given. For most rehabilitation schemes this will mean a lifespan of at least 30 years but there may be some schemes that have a shorter life expectancy - please see Procurement and Scheme Issues 3.3. Additionally, a building surveyor (not necessarily the one that carried out the survey) needs to certify on completion that those works have been carried out.

4.2.8 Any planning conditions or reserved matters, as far as practicably possible, must also be signed off prior to the achievement of practical completion Procurement and Scheme Issues 6.1.1.

4.2.9 This will trigger payment of the practical completion tranche of funding (25% of the grant where an acquisition and/or start on site tranche has been paid or 100% where all grant is paid on completion). Please refer to Finance 3.6 for further information on claiming practical completion payments.

4.2.10 For Social HomeBuy, HOLD, Leasehold Repurchase and Right to Acquire, practical completion will be the date when the purchase is completed.

4.2.11 For the purposes of Off The Shelf products, the units must be ready for immediate occupation. In the case of a new Off The Shelf development, a claim for grant should not be made prior to the completion date (as specified on the practical completion certificate issued by the duly authorised contractual party). However, there are circumstances when grant can be claimed on exchange of purchase contracts please see Finance 3.3.2. Please see the guidance notes at Procurement and Scheme Issues 3.2.2 and Finance 3.6.2 for more details on Off the Shelf schemes. For these products, achievement of the practical completion milestone will trigger payment of 100% of the grant. Please refer to Finance 3.6 for further information on claiming practical completion payments.

4.3 Payment flexibility

4.3.1 Providers eligible for payment flexibility are able to draw down up to 95% of their grant claim at the acquisition or start on site milestones. It should be noted that this is subject to funding availability. For and not for profit Registered Providers are eligible for payment flexibility. Unregistered bodies and ‘other’ partners (for example, new entrants or partners where there are deliverability concerns) are not entitled to payment flexibility.

4.3.2 For eligible providers, grant can only be drawn down against development expenditure where the Grant Recipient has incurred costs and made a payment. Costs that are committed but not yet defrayed are not eligible for inclusion in the claim (i.e. costs must be incurred). The development cash flow for the affordable housing expenditure on the relevant scheme in IMS must be in excess of the grant tranche claimed at the time of the relevant milestone. Any further payment of grant will become due at the next relevant milestone with 5% minimum final tranche at practical completion.

4.3.3 Grant can only be claimed against development expenditure for an Active Site where the Grant Recipient or Delivery Partner has a secure legal interest (see section 3.1.1 of the Finance chapter). Grant cannot be paid in advance of need and providers will be required to certify this at the point of making a claim through IMS. The following scheme types and processing routes are proposed to be exempt from CME flexibilities:

the statutory Right to Buy and Acquire schemes and the Social HomeBuy incentive scheme, where Registered Providers reclaim the discounts paid to tenants to acquire their homes, are not eligible
Home Ownership for people with Long-term Disabilities (HOLD) and off the shelf products are excluded where in both cases there is only a single final cost completion payment
schemes where providers are engaged in ‘Golden Brick’ arrangements prior to start on site are not eligible (see the Finance chapter, ‘Grant claims and payments’, paragraph 3.5). Schemes that involve Homes England land are also excluded
Traveller Pitch funding schemes are excluded on the basis that there are often deliverability concerns associated with these schemes. These schemes are often led by unregistered bodies and do not always deliver affordable housing. Note that for providers delivering only ‘standard’ traveller pitches (such as with an amenity building, but not built sleeping accommodation), the requirement to be registered with the Regulator of Social Housing does not apply as this form of provision is not formally classed as accommodation (see the Specialist Homes chapter, ‘Traveller pitches’, paragraph 4.1.9).
forecast milestones in 2022 to 2023 are eligible for CME flexibilities, with balancing sums paid at practical completion in line with not less than or equal to 5%. However, offer lines with acquisition and start on site forecasting in 2023 to 2024 or beyond are not eligible
Rough Sleepeing Accommodation capital schemes could potentially qualify for CME flexibilities, but as these are funded separately by the Department for Levelling Up, Housing and Communities, these would need to be approved separately

4.3.4 Development expenditure must relate to the delivery of grant funded affordable housing only. Where other tenures are provided on the same site costs should be apportioned appropriately and signed off by an independent consultant or the Development Director or Finance Director. Development Expenditure should only be claimed against affordable homes that are eligible for grant funding (i.e. it is not expected to include expenditure against any delivery through a Section 106 Agreement or similar planning obligation).

4.4 Milestone forecasts

4.4.1 Milestone Alerts As schemes progress they will be monitored against the series of milestones. Providers are therefore required to record within IMS when the various milestones have been achieved.

4.4.2 Providers are expected to update and reforecast milestones as soon as they are aware of any changes. Procedures for dealing with changes to milestone dates are set out in section 8 of the grant agreement and will constitute a material change to the allocations (please see 2.2 and section 5).

5. Changes to agreed allocations

5.1 General

5.1.1 Changes or variations to a provider’s agreed allocations will be handled via IMS and, if material, will require approval by us. Where the provider becomes aware of circumstances which give rise to the need for changes to their allocations they must be submitted via IMS, specifying the reasons for the proposed change.

5.1.2 We will decide whether to accept any changes on the basis of whether they will continue to meet the strategic need for which the allocations were originally approved.

5.1.3 Changes could consist of:

A reduction or increase or other change to the number of dwellings to be delivered or to the conversion capacity
A reduction or other adjustment to the allocated grant
Changes to forecast dates
Substitutions for schemes that are no longer able to be delivered within the programme requirements, including by the long stop date

5.1.4 Each change, submitted via IMS, will be considered on its own merits. However, we may opt not to agree to proposals and, in some circumstances, may choose to withdraw funding regardless of how far a particular scheme has progressed. Therefore, it is in providers’ interests to keep us appraised of any proposed programme changes as soon as possible.

5.1.5 Where changes are acceptable and approved by us, we will pay grant on affected schemes upon receipt of a valid claim provided that no other fundamental changes in provider status have occurred at the time of a claim.

5.1.6 All material changes must be identified and discussed with us before providers claim grant on affected schemes. Where changes are not disclosed to us or have not been approved, providers will be at risk of falsely certifying on IMS that the data are correct and meet the requirements in the contract.

5.1.7 Where there are differences, not previously agreed via a request made through IMS, between data input following legal completion and the data input at programme approval, providers will be required to give reasons for the variations in order for us to approve the grant payment.

5.1.8 In some situations, if a material change to the allocation results in reduced delivery outputs or value, they may result in a reduction of the allocated grant.

5.1.9 Where there are differences, not previously agreed via a request made through IMS, between data input following legal completion and the data input at programme approval, providers will be required to give reasons for the variations in order for the Agency to approve the grant payment.

5.1.10 In the case of a fundamental termination event (see section 2.6) we may terminate the contract and reclaim any grant paid plus interest, except on schemes which competed before the default notice date.

5.1.11 Where there has been a change in provider circumstances this may trigger Homes England’s right to review or remove Investment Partner Qualification status.

5.1.12 The inclusion from the outset of the addition of nil grant schemes has no effect on the amount of payment of firm scheme grant for (only paid on schemes that require grant). We will pay the actual grant required and approved on each firm scheme, rather than averaging grant and paying on all schemes.

6. Management arrangements

6.1 General

6.1.1 Homes England requires that properties that are developed with the benefit of grant are managed and maintained in accordance with Regulatory Requirements and Standards.

6.1.2 This applies whether the properties are directly managed by the provider who developed them with grant, or by other organisations with whom the provider has contracted for management services.

6.1.3 All owners of properties that are offered for low-cost rent (whether Affordable Rent or Social Rent), must be Registered Providers but may contract out management if they wish. Registered Providers are responsible for providing efficient and cost effective management in the best interests of tenants, and are accountable for the public funds invested in the scheme.

6.1.4 Registered Providers can adopt a variety of management arrangements, including outsourcing the work (commissioning another organisation to provide services on the provider’s behalf - such an organisation is often referred to as a ‘management agency’).

6.1.5 Regardless of whether or not the provision of services has been outsourced, ultimate responsibility for effective management of any tenants and/or leaseholders’ interests and the stock will remain with the provider that owns the properties.

6.2 Requirements

6.2.1 The management of grant-funded homes may not be delegated to local authorities or other statutory bodies.

6.2.2 Where Registered Providers are commissioning another (non-statutory) organisation to provide services, they must do so in writing. The services to be provided must be clearly defined in the contract, as must the cost to the Registered Provider of receiving the services.

6.2.3 The contract for the provision of the services must be finalised and signed in time for the service provider to mobilise their resources to be able to deliver the services at an appropriate level of quality at the handover date.

6.2.4 Homes England does not provide a model management agreement.

6.3 Supported Housing issues

6.3.1 As noted at 6.2.1, Registered Providers cannot commission statutory bodies to provide housing management services to their residents. However, in Supported Housing schemes, Registered Providers may decide to enter into a support agreement with a statutory body to ensure the non-housing needs of tenants are met.

6.3.2 Such support arrangements must be based on a written agreement that sets out the responsibilities of each party.

6.3.3 The agreement must address the issues of performance review, the procedures to be followed in the event of breach of the agreement, and have provisions for termination by either party.

6.3.4 Where the arrangement involves a division of staff working in the scheme between two or more employers, Registered Providers must ensure that the agreement clearly states the responsibilities for the employment and management of staff, and include clear details of reporting lines.

7. Reporting and audit requirements

7.1 General

7.1.1 The reporting and audit requirements apply to schemes delivered under the AHP 2021 to 2026. In addition, the Compliance Audit requirements set out below apply to all schemes selected for audit, regardless of funding period.

7.2 Reporting requirements

7.2.1 The Homes England Provider Management team lead contact and the lead provider will agree a programme of review meetings throughout the period covered by this programme and close dialogue between the provider and us is encouraged. At each review meeting the Homes England lead contact and the provider will:

Review progress against the agreed targets
Monitor compliance with the method statements submitted and any other obligations assumed as part of the bidding process

7.2.2 Representation on both sides must be at a senior level in order that decisions and actions can be agreed and implemented immediately if necessary.

7.2.3 Schedules indicating the status of each scheme including output delivery must be provided to our nominated lead Contract Manager one week prior to each review meeting.

7.2.4 Additional liaison meetings may be called by either us or a lead provider to address any important issues that may arise between review meetings. Representation should include the Homes England Provider Management team lead contact, together with financial appraisal and / or representatives from the Regulator of Social Housing as appropriate.

7.2.5 The lead provider is required to provide timely notification to the Homes England Provider Management lead contact of any unresolved problems that:

Have been encountered with complying with the funding conditions or meeting the specified targets
Have been identified during the self-assessment process and which threaten the objectives set out
Which affect the ability of the lead provider, or any other participating providers, to deliver their obligations

7.2.6 Where the provider is acting as the lead in a consortium, then the lead provider is responsible for the arrangement of regular delivery review meetings involving all members of the consortium. These meetings should be planned so that up-to-date information may be reported to us at planned review meetings.

7.3 Audit requirements

7.3.1 Compliance Audit is the process by which we will check the provider in terms of procedural compliance. We expect that an annual audit will be carried out on a sample of eligible schemes by an independent auditor, appointed by each Provider being audited. Independent auditors will review schemes for compliance against a checklist of relevant questions and report any findings to us. Providers must therefore maintain a comprehensive scheme file that contains all relevant documents for each scheme

7.3.2 The purpose of the audit is to verify that all requirements and the funding conditions have been met, and that the provider has properly exercised its responsibilities as set out elsewhere in this Guide. It does not reduce the responsibilities of the provider and us to ensure that the costs in any claim for grant are appropriate and have been properly incurred.

7.3.3 If a local authority has concerns about a particular scheme, they should contact their lead contact in Homes England’s Growth Team to request that it be included in the next sample of schemes for audit.

Audit scheme file

7.3.4 Providers must maintain a comprehensive scheme file (or equivalent) that contains all relevant documents for Compliance Audit purposes. Phased schemes should be identified separately on documentation. The following list is indicative of the types of documents which will be examined. It is not intended to be a comprehensive listing.

Valuation report for the site/property acquired. The report should:
- Take account of all the relevant factors affecting the site/property and its development
- Carry the valuer’s signature in a format deemed acceptable by RICS or RICS guidance
- Clearly identify the site/property which is the subject of the valuation on an accompanying plan endorsed by the valuer
- Be valid at the date of exchange of purchase contracts
Where the vendor is a local authority - a letter from the local authority endorsing valuation
Confirmation from provider’s solicitors of the dates of exchange of purchase contracts and of completion, the purchase price paid and a comprehensive report on title (except works only schemes)
Documentary evidence to indicate that the procurement arrangements used agree with arrangements and procedures approved by the provider’s governing body
Where providers are receiving any other subsidy they must maintain a funding profile on file showing that grant is not being received in respect of costs subsidised by any other body
Where capital contributions to the scheme from other sources, including other public sources, are involved, confirmation of the amounts on offer and the sources of funding should be retained, including any correspondence with the third party (parties)
Surveys, drawings, specifications, specialist and other consultants’ reports
Terms of appointment of consultants
Evidence of the basis of selection of consultants and building contractor
Copies of the building contract document and final account documentation
Planning permissions, building regulations approval and any other statutory consents
Details of the insurance of the property during construction and following completion
Sale valuations (sale schemes only)
Details of prospective rents documented on the provider’s development files
Certificate of Practical Completion (including where partial possession is appropriate provided that all the units have been handed over leaving only external works to be completed)
For major site development works and VAT - final certificate/account in respect of the pre works and VAT certificates equating to the actual works costs above (note that these figures must together equate to the actual works cost element included in the final costs statement mentioned above)
Consultant’s estimate of final works costs and, where appropriate (Design and Build and Package Deals, etc.) a separate estimate of the non-works elements, e.g. on costs
Latest interim certificate showing actual costs to date
Rural Repurchase - record of surpluses made on staircasing transactions
For charitable providers that have claimed grant to cover VAT - a letter from His Majesty’s Revenue and Customs or the Registered Provider’s professional adviser confirming that the supply cannot be zero rated

In addition, for:

b) Schemes for rent

Details of rents, including housing benefit eligible service charges

c) Schemes for Shared Ownership

A property schedule showing addresses, floor areas, and valuations for the completed properties, together with actual rents and housing benefit eligible service charges
Sales valuations
Copies of leases

To confirm the amount of Other Public Subsidy that the provider may have received, both of the following must be kept on file by the provider for Compliance Audit purposes:
- A copy of the Market Value valuation provided by a qualified independent valuer, either obtained by the Local Authority or commissioned by the provider
- A letter from the public body stating that it endorses the valuation

Scheme sampling

7.3.5 The population of providers eligible for selection for compliance audit (eligible providers) is made up of developing providers with eligible schemes across all funding programmes. All schemes are eligible except:

Terminated schemes
Schemes with zero grant and no RCGF or DPF
Help to Buy

7.3.6 Eligible schemes include both:

Look-back schemes – any scheme which completed in the previous financial year
In-year schemes – any scheme where start on site has been claimed in a previous financial year, but where practical completion has not yet been claimed and which can be forecasting in the current or any future financial year

7.3.7 Homes England audits a selection of developing providers with schemes eligible for audit every financial year. Providers selected for audit are notified via email. If a provider is unsure whether they have been selected for audit in a particular year, they should contact their contract manager.

Independent Auditor Appointment

7.3.8 Providers may commission any suitably experienced and qualified member of one of the following professional bodies:

IACEW (Institute of Chartered Accountants in England) – ACA/FCA Chartered Accountant
ACCA (Association of Chartered Certified Accountants) – ACCA/FCCA Chartered Certified Accountant
RICS (Royal Institution of Chartered Surveyors) – FRICS/MRICS (but not Assoc RICS) Chartered Surveyor)
CIPFA (Chartered Institute of Public Finance and Accountancy) - Chartered Public Finance Accountant

7.3.9 The independent auditor may be the provider’s external auditors or external accountants undertaking their internal audit function.

7.3.10 However, qualified accountants or surveyors directly employed by the provider or any of its fellow consortium members are excluded as they are not considered to be appropriately independent. Arrangements where qualified development consultants are employed by a qualified accountant or surveyor to act in their name are acceptable to us, on condition that the arrangement maintains the duty of care required by us and the commissioning agreement is between the provider and the accountant or surveyor.

7.3.11 Reciprocal arrangements between organisations with dedicated internal audit functions are permitted, as long as they comply with the requirements in paragraphs 7.3.7 – 7.3.9 above.

Standardised Terms of Engagement

7.3.12 Homes England will undertake to become a party to the commission via the standardised terms of engagement route utilising the agreed procedures as set out in Appendix F of the Institute of Chartered Accountants of England and Wales (ICAEW) Technical Release – AAF 01/10 publication. For further guidance please see below.

By reference to these standardised terms of engagement we make an offer to engage on these terms without the need to sign a commissioning document. We will engage on these terms with suitably experienced and qualified Chartered Accountants, Chartered Certified Accountants and RICS Chartered Surveyors. If the offer to engage is accepted by a provider and an accountant or RICS surveyor, then an agreement is formed.

7.3.13 The provider must commission the independent auditor to undertake a programme of self-assessment procedural compliance tests. We will discuss the scope of the audit and agree a provisional programme at the commencement of the programme to assist providers in planning the arrangements and budgeting to meet these requirements.

7.3.14 We reserves the right to request copies of the signed ‘self-assessment agreement’ as and when necessary throughout the life of the agreement.

7.3.15 The provider is strongly advised to discuss the principles and planned arrangements for self-assessment with us prior to commissioning the independent auditor.

7.3.16 We will issue the provider with a scheme sample report listing the details of the schemes to be audited. The list is issued four weeks before the audit is to take place.

7.3.17 Detailed guidance on the compliance audit process can be found on the Compliance Audit website pages.

8. Legacy affordable homes programmes

8.1 Programme requirements

8.1.1 Programme management guidance for previous affordable homes programmes can be found via the following links.

8.3.1 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.

9. Affordable Homes Programme 2021 to 2026 information

9.1 Investment Partner Qualification (IPQ)

9.1.1 Investment Partner status is a mandatory qualification that must be achieved by prospective partners before we can make any payment under Homes England’s AHP 2021 to 2026 and any associated affordable housing programmes.

9.1.2 For more detail, refer to section 2.1 of this chapter.

9.2 Contract framework - Grant Agreement terms for the AHP 2021 to 2026 Continuous Market Engagement (CME) and Strategic Partnerships

9.2.1 All providers successful in bidding through the AHP 2021 to 2026 CME and Strategic Partnerships routes will be required to enter a grant agreement with Homes England relevant to the Grant Recipient(s) organisation type, structure and delivery model.

9.2.2 Homes England is in the process of developing a suite of standard form Grant Agreements applicable to the AHP 2021 to 2026, further to a review of business needs and policy including DLUHC’s New model for Shared Ownership:

Agreement type	Use	Status
Private RP (Single Provider)	For a private RP (profit or not for profit) intending to own the land, develop and be the RP landlord of the completed homes.	Published
Public RP (Single Provider)	For a public RP (LA) intending to own the land, develop and be the RP landlord of the completed homes.	Published
RP Consortium	For a consortium of RPs (of any number/ RP type) with land owner, developer and RP landlord roles spread amongst the lead provider and its members.	Published
Strategic Partnership (not for profit)	For a not for profit Strategic Partner working with its approved partners to develop and deliver completed grant funded affordable housing	Published
Strategic Partnership (not for profit long-term)	For a not for profit long-term Strategic Partner working with its approved partners to develop and deliver completed grant funded affordable housing	Published
Strategic Partnership (for profit)	For a for profit Strategic Partner working with its approved partners to develop and deliver completed grant funded affordable housing	Published
Unregistered Body (URB) Agreed Transfer	For unregistered bodies intending to develop on their own land or that of the proposed RP Landlord and pass the completed homes and grant liability to them at completion	Published
Unregistered Body (URB) Retained Ownership	For unregistered bodies intending to own the land, develop and be the (unregistered) landlord of completed Shared Ownership homes	Published
Traveller Pitch - Private RP	For a private RP (not for profit) in relation to the Traveller Pitch allocation under the Homes England Affordable Homes Programme 2021 to 2026	Published
Traveller Pitch - Public RP	For a public RP (LA) in relation to the Traveller Pitch allocation under the Homes England Affordable Homes Programme 2021 to 2026	Published
Traveller Pitch – Public non-registered	For a public (LA) unregistered provider in relation to the Traveller Pitch allocation under the Homes England Affordable Homes Programme 2021 to 2026	Published

See these example agreements

9.2.3 The other standard form agreement types are in development and will be published here once available.

9.2.4 The standard form agreements are intended to establish a clear and consistent set of non-negotiable terms applicable to the most common provider types and delivery models presented.

9.2.5 Where delivery models do not fit a standard form agreement Homes England will consider reasonable adjustments to create bespoke forms of agreement subject to a justified business need and fit with our programme parameters. 

9.2.6 Providers are advised to clearly articulate their delivery model including landowner, developer and landlord roles at bid stage to ensure that an appropriate form of grant agreement can be entered.

9.3 Continuous Market Engagement (CME) assessment process in the AHP 2021 to 2026

Note of changes for regeneration

From June 2023 funding can be used for regeneration – to fund replacement homes where they are being delivered alongside net additional affordable housing. See also the Procurement and Scheme Issues chapter, section 3.2.2: Scheme types.

Note on changes to Shared Ownership

On 8 September 2020 the Government proposed a new national model for Shared Ownership and sought views through a consultation published on 19 November 2020 - see The new model for Shared Ownership: technical consultation.

The Government announced the outcome of this consultation on 1 April 2021 – see new Shared Ownership model consultation outcome. Please see the Shared Ownership chapter of this guide for more information. This new Shared Ownership model applies to all homes funded by Homes England through the AHP 2021 to 2026, as well as applying to AHP 2021 to 2026 rented homes purchased on a Shared Ownership basis through the Right to Shared Ownership, and Shared Ownership homes provided through receipts from the Voluntary Right to Buy Pilot programme

9.3.1 Overview

9.3.1.1 This section provides more detail on the bidding and assessment process for the CME route to access funding from the AHP 2021 to 2026 and should be read in conjunction with the main fund guidance and associated information in the Capital Funding Guide.

9.3.1.2 Applications for affordable housing funding through CME are known as bids. Bids are assessed on an individual basis against the criteria and considerations set out in the next section.

9.3.1.3 The assessment aims to ensure that all bids:

Meet the government’s aspirations to increase the levels of affordable homes and home ownership
Offer good value for money where costs are minimised
Have good and demonstrable prospects of early delivery and within the programme timescale
Where achievable meet the wider strategic objectives of the programme, particularly the use of Modern Methods of Construction (MMC)
Development of supported housing (10% of homes delivered) and development in rural areas (10% of homes delivered) to address locally identified need

9.3.2 Bidding

9.3.2.1 For CME, bids are submitted through the Homes England Investment Management System (IMS). There is no fixed bidding round for this fund. You can submit bids from opening for as long as there is funding available.

9.3.2.2 Applications for funding should be made for ‘firm’ schemes which have been fully identified and details of the planned development confirmed (site, cost, tenure mix, delivery timeline, etc). ‘Indicative’ schemes, where details are yet to be fully worked up, are only currently permitted for Home Ownership for people with Long-term Disabilities (HOLD) and Empty Homes schemes.

9.3.2.3 You can submit bids for more than one development scheme in a single funding application. However, assessment and decisions are made on each scheme individually. This means that bidders who submit an application which includes bids for more than one scheme may find that funding is approved for some, but not all, schemes submitted. Where developments are mixed tenure, scheme plans for each tenure are input into IMS separately and assessed individually. Although the deliverability of the entire development is considered, each scheme must be able to stand alone with no cross-subsidy or interdependence assumed, including where schemes are on the same site.

9.3.2.4 Bids must be submitted with your best and final offer and full details provided through IMS. Where more information or clarification is needed to process and / or assess a bid for funding we will contact you.

9.3.2.5 There are three stages to the bidding process;

Bid submission - You can submit your bid through IMS whenever you’re ready with a firm, deliverable scheme. As outlined, under CME there are no separate bidding rounds and you can bid as soon as the fund opens, for as long as funding is available.
Bid assessment - Once you’ve submitted your bid, we will carry out the initial assessment against our key criteria. If any of the information is missing or unclear from your bid, we will get in touch to clarify. It usually takes a minimum of 30 working days (around 6 weeks) to complete the assessment and clarifications. Depending on the type and size of the bid and the quality of information submitted, additional review and moderation may be needed. In these cases, it may take longer to complete this process, and decisions are only made on complete submissions.
Assessment decisions - Finally, we will review your bid against others that we have received to ensure it is competitive and that our assessment decisions are consistent. Awards of grant allocations are determined on a regular basis, and we aim to reach a decision in a reasonable timescale following assessment.

9.3.2.6 Practical information on submitting bids in IMS and how to arrange access to the system is available at Homes England’s IMS guidance webpage.

9.3.2.7 If you are not already a Homes England Investment Partner, we recommend making this application at the same time as submitting your bid. More information is available in the Investment Partner Qualification guidance.

9.3.2.8 Strategic Partners with a Grant Agreement under the AHP 2021-26 should submit proposals for regeneration schemes through CME for assessment. Funding and delivery will be managed through the Strategic Partnership Grant Agreement (more information is available in the apply for affordable housing funding guidance).

9.3.3 Assessment

9.3.3.1 The two key elements to assessment are cost minimisation and deliverability, with further qualitative assessment against the strategic objectives of the fund.

a) Cost minimisation

9.3.3.2 Our key consideration in assessing value for money is to ensure that costs are minimised. The measure for this is the level of grant funding requested per home. We expect bidders to take all reasonable measures to minimise the grant requested, including:

minimising both costs of building and over the life of the home through efficient procurement, construction and management,
maximising other funding (for example cross-subsidy from market sales or disposals, or for Registered Providers using Recycled Capital Grant Funding), and
minimising land costs, including by working with public sector partners to identify land available at low or no cost, and through negotiation to secure demonstrable discount.

9.3.3.3 Homes England scores all scheme proposals against regional and scheme type averages. These averages are used as benchmarks to compare the levels of grant requested (for example, against the average grant requested locally and nationally for similar schemes) and what the scheme will deliver (for example, grant requested relative to the size of the homes being built), to ensure bids are competitive on both costs and outputs. The comparisons also allow us to identify what are known as outliers; schemes which sit outside of the average ranges and require further testing against cost minimisation.

9.3.3.4 Outliers will only be funded if we understand and accept the reasons for exceptional grant or costs, and the scheme type is a priority and / or meets a strategic objective within the programme.

9.3.3.5 We understand that costs can vary significantly for a wide range of reasons. To assess outliers we will use genuine comparators (such as other rural or older persons’ specific schemes, or MMC developments), and may ask you to provide further information to understand and support higher levels of grant request.

9.3.3.6 Schemes with a very low amount of grant per home will not automatically be approved. Although cost reduction is an essential part of ensuring good value for money, all schemes must offer strong certainty of delivery and quality. As such, our assessment will consider the difficulty of replacing low grant schemes without additional funding should delivery slip or the scheme no longer go ahead.

b) Deliverability

9.3.3.7 Schemes funded through CME must have started on site by 30th September 2025 and be completed by 31 March 2026. We will prioritise schemes that can be delivered in the early years of the programme to support a strong start to delivery of new homes.

9.3.3.8 Deliverability will take account of the level of planning achieved, the status of land ownership and progress on works tender contracting, as well as making sure that timescales for delivery are robust and realistic.

9.3.3.9 We will also look at past performance of existing partners. New providers will not be penalised for the lack of a track record of delivery. However, we will look closely at the forecasted delivery and measure this against similar schemes for comparison, as well as seeking feedback from the local authority on, for example, progress through planning.

9.3.3.10 Homes England supports partners to meet the locally identified need for affordable housing. As such, we consider the views of local authorities on how rented and supported housing bids in their area align with their local affordable housing strategy and address local housing needs. You will be asked to provide evidence of your engagement with local strategic housing authorities about development proposals, the feedback received, and evidence that the homes proposed are additional to those required by planning policy (eg. Section 106) on market-led sites.

c) Strategic priorities

We will assess how proposed developments meet the wider strategic objectives of the fund and will prioritise schemes which help deliver these objectives. This will be done both through qualitative assessment and by acknowledgement of justifiable variations in the quantitative assessment on cost and delivery.

9.3.4 Modern Methods of Construction (MMC)

9.3.4.1 MMC is a key strategic priority of this fund and we welcome bids for schemes which include the use of construction methods outlined in the MMC section of the Capital Funding Guide. There is further detail available in the MMC definition framework, which sets out the seven categories of MMC.

9.3.4.2 With many areas of technology and manufacture still emerging in the MMC sector, we understand that the cost of these schemes and comparable information can be very different to traditional build. If you would like to discuss your plans with us before submitting a bid, please speak to your Homes England contact or email us at the address below.

9.3.5 Design and quality

9.3.5.1 All new schemes will be expected to deliver well designed places and bidders will be required to indicate how the scheme delivers against the 10 characteristics set out in the National Design Guide, which include sustainability and environmental impact. While it is not a mandatory requirement, bidders are also encouraged to use the Building for a Healthy Life (BHL) criteria in their scheme design and to record their score in their bid on IMS.

9.3.5.2 All bids will be benchmarked against the Nationally Described Space Standard which covers gross internal floor area for difference sizes and types of building. We will work with providers to understand significant variations from the published standards (outliers).

9.3.5.3 Bids for specialised housing for older, disabled or vulnerable people are asked to submit design plans. These schemes must show consideration of good practice and how their proposal scores against the HAPPI design principles.

9.3.5.4 This fund will only support schemes that include bedsits where the local authority confirms the bid meets an identified strategic housing need, for example, in some types of supported accommodation.

9.3.6 Specialist and supported housing for older and vulnerable people

9.3.6.1 In addition to the review of the design plans for the scheme, Homes England will look at:

How the scheme meets locally identified needs and complements existing services
Consultation with local commissioning bodies.
How the typology, location and design of the accommodation will ensure it meets the needs of the relevant client group(s).
If revenue funding is needed for the intended operation of the accommodation, and whether has this been identified.
The exit plan or alternative use for the building should commissioning priorities change in future.

9.3.7 Rural housing

9.3.7.1 Delivery of rural affordable homes is a strategic priority for the fund with a target of 10% of the homes delivered in rural locations; settlements with less than 3,000 population.

9.3.8 Small to Medium Enterprises (SMEs)

9.3.8.1 As part of Homes England’s overall mission to create a more resilient and diverse housing market we encourage applications from SME providers and support the inclusion of SME contractors in partners’ supply chains.

9.3.9 Equalities

9.3.9.1 In 2010 the Equalities Act introduced a set of Public Sector Equality Duties that all public sector organisations must show due regard to in their work and demonstrate this by recording its consideration of them.

9.3.9.2 The Homes England duties include the need to consider how the proposal to invest grant addresses a primary equality duty from the following whenever we make investment decisions.

Eliminate discrimination, harassment and victimisation and any other conduct that is prohibited under the Act.
Advance equality of opportunity between persons who share relevant equality characteristics and persons who do not share it.
Foster good relations between persons who share a relevant protected characteristic and persons who do not share it.

9.3.10 Homes England contact

9.3.10.1 If you have any queries or would like to discuss a potential bid, please contact Homes England at ahp2126@homesengland.gov.uk.

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