£1bn for Social Housing Pushes UK Programme Past £40bn

Wednesday's Budget will pump more than £1bn into social and affordable housing in England, pushing total funding for the government's 10-year homes programme past £40bn.

The housing money is the headline number, but the bigger structural shift sits elsewhere. Mayors and regional leaders across England are expected to receive greater powers and funding, with councils helped to borrow from the government for housebuilding through preferential interest rates. The Treasury says the plans should give regional leaders more flexibility and authority over investment decisions.

Chancellor John Healey said English cities and regions would get the "right to decide their own future". Prime Minister Andy Burnham framed the plans as shifting power to those "who know their communities best".

How much money is actually moving?

The devolution package has two concrete sums attached:

• £285m in transitional seed funding, allocated next year, to support mayors and local leaders and cut reliance on what the Treasury calls "fragmented bidding pots" in Whitehall.
• A new £1.5bn borrowing facility from 2028, designed with mayors, giving them access to capital for local priorities.

The Treasury said the borrowing facility could fund new homes, bring high streets back to life, or improve transport links. Areas that are not yet strategic authorities will still be able to access a share of the £285m to "unlock projects which will contribute to growth in their areas".

Healey said: "Mayors and local leaders know what their communities need to grow, which is why we are giving them more money, more power and more capacity to get projects moving, build homes and make the right decisions for their areas."

The prime minister went further on the politics: "I'm calling time on local leaders going cap in hand to Westminster. That is no way to run a country."

What do the mayors want to build?

Claire Ward, chairwoman of the UK Mayors Network and Labour's East Midlands mayor, said the "right powers and resources through increased devolution" would help turn "ambitious plans into reality and deliver real, lasting change" for communities.

Lord Sadiq Khan, Labour's mayor of London, said greater ability to invest could "help unlock transformational infrastructure projects" — naming the West London Orbital route, the Bakerloo line extension, the Docklands Light Railway and the development of Stratford International station.

Where does defence fit in?

The Sunday Times reports Healey is expected to unveil billions of pounds of new defence spending in the Budget, with details to come at next year's spending review.

The pressure is personal for the chancellor. Healey resigned as defence secretary in June from the previous government over its defence investment plan, which he claimed fell "well short" of what the armed forces needed. He had called for defence spending to reach 3% of GDP by 2030, en route to a Nato target of 3.5% in 2035.

Shadow chancellor Andrew Griffith demanded Healey resign if he fails to set out how the UK will hit the 3%-of-GDP mark by 2030. "We are living in an era of extraordinary threats, and yet the chancellor is dithering over finding the money to pay the country's insurance premium... you cannot have a strong economy without a strong defence," Griffith said.

Defence Secretary Wes Streeting hit back, blaming the Conservatives for failing to invest in the military while in office. Streeting said the prime minister had made clear his government was "determined to give our armed forces the investment needed to keep us safe".

What else is in the small print?

Small breweries get more support, with the Treasury saying the chancellor wants "to turn the tide for our pint producers".

One cloud hangs over the Budget build-up. Alex Depledge, the Treasury's entrepreneurship adviser, announced her resignation — she leaves on Thursday, the day after the Budget. Start-ups, she told the Sunday Times, were being treated as a "sideshow" and pushed to the "margins of economic policy".

"Keeping scale-ups on the fringes underestimates the contribution of our greatest companies, and we need to support and develop them on British shores at all costs," she said.

With housing, devolution, defence and small brewers all competing for fiscal room, Wednesday will show whether Healey can keep every constituency — mayors, generals and founders — satisfied at once.