Homes England ^{[footnote 1]} Annual Report and Financial Statements 2023 to 2024

Presented to Parliament pursuant to Paragraphs 11 and 12 of schedule 1 of the Housing and Regeneration Act 2008.

Ordered by the House of Commons to be printed on 29 July 2024.

1. Chair’s foreword

Peter Freeman CBE — Chair

We are England’s housing and regeneration agency, with an important mission to drive forward the creation of high quality, sustainable homes and thriving places.

This year, we have helped bring to life the vision of many cities, towns and rural communities. To do this we have worked in partnership locally, regionally and nationally with hundreds of organisations to deliver more homes, more growth and better places.

During 2023 to 2024, Homes England enabled the completion of more than 32,300 homes, facilitated the start of construction for an additional 35,600 homes, and unlocked delivery of a further 26,200 homes. The Agency exceeded its affordable housing targets with 24,282 completions and 29,067 starts.

This performance was in the context of the market, with housing supply statistics showing a 10% fall in completions in England from 2022 to 2023, and a fall of more than 15% in the number of housing starts over the same period.

During the year we expanded our focus beyond housing to include a greater emphasis on regeneration — an aim we set out in our strategic plan, published in May 2023.

Achieving lasting transformation, addressing deep-rooted social and economic challenges to create sustainable and thriving neighbourhoods is a complex and multifaceted process that takes decades of dedicated effort and investment. Often, despite best efforts, the market fails to deliver the ambitions of towns, cities and regions. This is where we step in.

We are both catalyst and collaborator, offering our support as and when needed to facilitate change, often across many years. We leverage resources, build trust, coordinate efforts, increase accountability and mobilise communities. We de-risk the business of home creation and the regeneration of places, helping to unlock and accelerate housing delivery, attracting private sector capital and skills.

We are at our most effective when we blend all of our powers, capital, capacity and capability together, convening long-lasting relationships and bringing the confidence needed to drive delivery of sustainable housing and urban regeneration across the country. By combining our tools we aim to maximise our impact.

I am pleased that Homes England’s key role was recognised in a Public Bodies Review, an independent review which all Arm’s Length Bodies must undergo periodically to assess their performance, relevance and value for money.

As well as recognising the strong move towards urban renewal and regeneration already underway, the review affirmed the Agency’s key role as a national public body of scale, also noting our effective delivery and stewardship of vitally important home ownership and building safety schemes, on behalf of government.

I welcome such positive endorsement of the Agency’s efficiency and governance alongside recommendations for both improvement and for developing our mandate and structure. Much of this work is already happening. Other recommendations will require changes in partnership with MHCLG and HM Treasury, but if progressed could be transformational in how we deliver new homes and create thriving places.

While there is much to celebrate, we are steadfast in our resolve to always improve, ensuring that we are effective and efficient in driving forward the country’s housing and regeneration ambitions.

Over the year, I have visited many sites and places across England and seen the positive impact of Homes England’s work to drive partnerships with local leaders and the wider public, private and third sectors. I am particularly delighted to see that across the period of this report we led the creation of three Strategic Place Partnerships (SPPs) in South Yorkshire, West Yorkshire and the West Midlands.

SPPs are deeper, place-based arrangements where the Agency brings together all of its interventions to enable local visions to be realised. SPPs are an example of how the Agency works to foster and maximise partnerships to ensure lasting change in communities across England.

I have also had the opportunity this year to work alongside a team drawn from all parts of the Agency in my role as Chair of the Cambridge Delivery Group. It has given me an exceptional opportunity to attend meetings every week where I have been able to see how the range of our team’s technical skills and their ability to create positive relationships with local stakeholders which dovetail with the work of MHCLG to progress projects of complexity and scale.

But, of course, this isn’t just about numbers and places. It’s about lives.

I have had the privilege of Chairing the Homes England Board now for nearly 4 years. I took up this important role as I care deeply about helping to ensure that everyone —no matter who they are or what background they are from — should have a place they are proud to call home. So, reflecting back on the achievements in this report I feel honoured I am part of an organisation that is doing just this.

I am hugely grateful for the commitment, passion and hard work of our staff who have worked tirelessly to ensure Homes England met — and in some areas exceeded — its annual targets across 2023 to 2024. Thanks to them — and the huge network of organisations we work in partnership with — we advanced our mission to create more places where people can live, work and thrive.

2. Performance report

The Performance report provides a summary of Homes England and how we have performed during the year.

The report is broken down into 2 areas:

• performance overview, which sets out an overview of Homes England, our purpose, strategic objectives, performance and risks
• performance analysis, providing detail of our delivery performance, risks impacting delivery, a financial review, and work being undertaken in relation to sustainability and climate change

2.1 Performance overview

This section provides an overview of Homes England, our purpose, strategic objectives, performance and risks.

It also explains adoption of the going concern basis in preparation of this Annual Report and Financial Statements.

Performance highlights 2023 to 2024

• Enabled the completion of more than 32,300 homes.
• Facilitated the start of construction for an additional 35,600 homes.
• Unlocked land that is capable of delivering more than 26,000 further homes.
• Established three Strategic Place Partnerships (SPPs) in South and West Yorkshire and the West Midlands. These join our existing SPP with Greater Manchester Combined Authority. In total these SPPs serve a population of almost 10 million people.
• Launched the Cladding Safety Scheme to give more buildings access to government funding to address life safety fire risks associated with cladding.
• Worked with over 20 priority places to drive housing and regeneration — including with Sheffield with a £67 million funding package to create 2 new residential neighbourhoods in the city centre.
• Forged innovative funding partnerships, including with NatWest Group to provide a £75 million development facility for Adlington Retirement Living to accelerate the growth of its integrated retirement communities across the country.
• 87% of the completions we enabled achieved an Energy Performance Certificate (EPC) rating of B or above.
• Exceeded our targets for affordable housing with 24,282 completions and 29,067 starts.
• Targeted our support to some of the areas most in need of regeneration across the country — including inner Blackpool, where we agreed a £90 million funding package to accelerate vital regeneration projects.

Chief Executive’s statement

Peter Denton — Chief Executive

In 2023 to 2024 Homes England met, and in some cases, even exceeded its delivery targets.

This performance — which was delivered during a year of turbulent market conditions — is evidence of Homes England’s work to ensure that more people have a home in a safe, sustainable, thriving community.

It is also an endorsement of the findings and recommendations of the recent Public Bodies Review of Homes England, which concluded Homes England is delivering better housing and better places.

The Review, which also gave recommendations on how we can further improve, acknowledged how, by combining our land, powers, funding and expertise – reducing risk to drive investment, harnessing the potential of private and public sector skills, capital and partnerships — the Agency is an essential catalyst for local regeneration and housing delivery.

Home creation and the regeneration of places

During the year we strengthened our partnerships with local and regional leaders to bring to life the ambitions of cities, towns and communities, combining all our interventions, skills, expertise and resources under one united offer to drive transformation.

Across the country we are supporting local leaders to drive forward their clear visions, plans and priorities for regeneration and urban renewal, from catalysing garden communities and new settlements to supporting more than 20 urban places to develop and deliver long term housing and regeneration pipelines including in:

• Blackpool, where working with the Council our Brownfield Infrastructure Land (BIL) Fund programme will transform local communities and catalyse vital positive change in one of the town’s most deprived areas.
• Newcastle, where our acquisition of Forth Yards — a complex, challenging brownfield site — will finally bring to life the city’s vision for the potential of 2,500 quality, sustainable new homes and the regeneration of an area that has been stalled for more than 20 years.
• York Central, where we’ve partnered with Network Rail and the council to create a masterplan that will regenerate one of the UK’s largest brownfield sites, providing 2,500 homes, 1 million square feet of offices, retail and leisure space, up to 6,500 new jobs and delivering over £1.1 billion of gross value added to the economy of York per year. This agreement — with preferred developer McLaren Property and Arlington Real Estate — is a significant milestone for a site that has failed to leverage private sector investment for nearly 30 years.
• Sheffield, where we have been part of the Sheffield Together partnership since 2022, and assembled nearly 50 different sites with capacity for almost 5,500 new homes and helping deliver major local plans to boost the city centre. A strategic plan has been agreed for the creation of three new neighbourhoods: Furnace Hill and Neepsend; Moorfoot; and Sheffield Station Campus. In March 2024 we provided £67 million of investment to support land assembly and enabling works across 12 acres of brownfield and underutilised land, kickstarting the transformation of these sites.
• Birmingham, where we are working with the City Council and West Midlands Combined Authority to bring MasterChef, studio workspaces and other creative industry uses to the heart of Digbeth in Birmingham. Here, there is potential to deliver around 900 new homes and 25,000 square metres of commercial floor space on Homes England land.
• Bristol Temple Quarter, where we are working with regional and government partners to support the development of up to 10,000 homes, 22,000 jobs and an estimated economic boost of £1.6 billion (Gross Value Added) with a series of new sustainable and inclusive communities on land around Bristol Temple Meads station.

To create and sustain momentum with combined authorities across England, during the year we expanded our vision for a new, deeper form of partnership: Strategic Place Partnerships (SPPs).

SPPs recognise that it takes many decades of dedicated effort and investment. Partnership and collaboration are the cornerstones in achieving this, to leverage resources, share expertise, build trust, coordinate efforts, increase accountability and mobilise communities. During 2023 to 2024, the Agency established three SPPs in South and West Yorkshire and the West Midlands, joining an existing SPP in Greater Manchester. In total these SPPs serve a population of almost 10 million people.

Homes England priority place activity

Housing Supply Partnerships:

1. Attleborough
2. Aylesbury Garden Town (GT)
3. Bailrigg GT
4. Barrow-in-Furness
5. Berinsfield Garden Village (GV)
6. Bicester GT
7. Bold Forest Garden Village
8. Borough Green GV
9. Brookleigh
10. Burtree GV
11. Chalgrove Airfield
12. Culm GV
13. Dalton Barracks GV
14. Dewsbury Riverside
15. Didcot GT
16. Digbeth, Birmingham
17. Dunsfold Park GV
18. Dunton Hills GV
19. East Cambridge
20. East Norwich Strategic Regeneration Area
21. East of Biggleswade GV
22. East West Rail Corridor
23. Exeter GT
24. Fareham
25. Godley Green GV
26. Golden Valley (Cyber Central) GV
27. Halsnead GV
28. Handforth GV
29. Harlow and Gilston GT
30. Heathlands
31. Hemel GT
32. Huncoat GV
33. Ifield
34. Infinity GV
35. Langarth GV
36. Langley Sustainable Urban Extension (SUE)
37. Lea Castle
38. Lighthorne Heath
39. Locking Parklands
40. Long Marston GV
41. Longcross GV
42. Manydown GT
43. Meecebrooke GV
44. Middlewick Ranges
45. New Carrington, Trafford
46. Newton Abbot GV
47. North Dorchester GV
48. North East Chelmsford GV
49. North Northants GT
50. Northstowe 51 .Otterpool Park GT
51. Panshanger
52. Queenborough and Rushenden
53. Skerningham GV
54. South Godstone GV
55. South of Ashford GV
56. South Seaham GV
57. Spitalgate GV
58. St Cuthbert’s GT
59. St George’s Barracks GV
60. SW Rugby
61. Taunton GT
62. Tempsford
63. Tendring Colchester Borders GV
64. Tewkesbury GT
65. Thames Estuary
66. Tresham GV
67. Upton Lodge
68. Uttlesford Park GV
69. Warrington SUE
70. Welborne GV
71. West Carclaze GV
72. West of Elvington GV
73. West of Harrogate
74. West Oxon (Salt Cross) GV
75. Whetstone Pastures GV
76. Worcestershire Parkway
77. Wynyard Park GV
78. York

Newcastle upon Tyne — Newcastle residents are part of a once-in-a generation transformation of the Forth Yards area from a derelict space to vibrant neighbourhood including 1,100 sustainable new homes, made possible by a partnership between the Agency, Newcastle City Council, the North East Combined Authority and Network Rail.

Blackpool — Young families are part of the Inner Blackpool community where a major regeneration project, including 250 new homes, is being driven by multiple partners, £90 million in funding from Homes England, and a shared mission to tackle deprivation.

Manchester — People in Victoria North will see 5,500 new homes built as part of a major transformation of the Red Bank area, driven by a Strategic Place Partnership between Greater Manchester Combined Authority and the Agency, which is providing £51.6 million of infrastructure funding.

Wolverhampton — Wolverhampton locals will enjoy a thriving new community at City Centre West, a large regeneration project that is creating around 1,000 new homes, as part of the Agency’s Strategic Place Partnership with the West Midlands Combined Authority.

Panshanger, Welwyn — Communities in Panshanger, Welwyn, will see a former World War 2 decoy airfield transformed into 860 high quality new homes with play areas, open spaces and community allotments.

Harlow and Gilston Garden Town — New and existing communities around Harlow will benefit from the growth of the Harlow Gilston Garden Town, comprising 4 new neighbourhoods and the regeneration of Harlow Town Centre. This includes 23,000 new homes and 23,500 new jobs connected by sustainable transport corridors, working in partnership with district and county councils in Hertfordshire and Essex and supported by a £171.5 million infrastructure investment.

Bristol — Bristol residents will see land around Temple Meads station regenerated into sustainable, inclusive communities — with up to 10,000 homes, 22,000 jobs and a potential economic boost of £1.6 billion — thanks to partnership working with Bristol City Council, Network Rail and the West of England Combined Authority.

Weston-super-Mare — Younger generations in Weston-super-Mare will benefit from 900 additional places at the town’s expanding secondary school, alongside 3000 new homes and a new bypass made possible by £100 million of infrastructure funding.

Ensuring more people have a place to call home

Affordable housing remains a priority for Homes England, and we have taken proactive measures to increase the supply of affordable homes and support households in need.

We have invested and enabled affordable schemes across England in some of the most deprived parts of the country. For example, in Manchester, we began working with Salix Homes to enable the creation of 96 homes in Salford’s Chapel Street where there is huge demand for affordable housing of all tenures. The 9-storey development has been built to Passivhaus Classic certified standard, which is the leading low-energy design standard, giving residents high thermal comfort and improved air quality, providing a healthier living environment and homes that are cheaper to heat and run.

During the year, we provided funding that has enabled the creation of over 500 new specialist housing units for homeless people and rough sleepers, run by local providers.

We also supported 622 households into home ownership through the Help to Buy scheme and First Homes pilot. Since it started in 2013, Help to Buy has helped more than 387,000 households into home ownership, of which almost 85% were first time buyers. The scheme has supported the purchase of 1 in 3 new homes, with the value of all homes purchased totalling over £109 billion since the scheme began. Although the Help to Buy scheme is now closed, we continue to play an important stewardship role for over 230,000 households with a Help to Buy equity loan.

Accelerating housing delivery

In 2023 to 2024, we targeted £400 million of funding to low and medium volume builders (LMVBs) to increase sector capacity and capability, and to overcome barriers to entry in the housing market.

Through our flexible and targeted investments, innovative financing solutions, and strategic partnerships with developers and local authorities, Homes England has helped accelerate the delivery of thousands of new homes across the country. Our efforts resulted in 32,320 new homes being built and the unlocking of a further 26,273.

Our partnership with the Greater London Authority (GLA) and Berkeley across 3 major brownfield regeneration sites in the London boroughs of Newham and Southwark is 1 example of how we are accelerating the delivery of thousands of homes. Our role in the partnership includes the provision of a £125 million loan to Berkeley to undertake infrastructure works across the sites, with additional funding provided by the GLA. It covers 3 projects in:

• Twelvetrees Park, Newham where this 26-acre site will be transformed into a mixed-use neighbourhood including close to 4,000 homes, a secondary school, park, playground and 177,000 square feet of commercial space.
• Bermondsey Place, Southwark where nearly 1,400 homes will be created across a 5.4-acre former light industrial site, alongside a network of public parks, playgrounds, commercial spaces, footpaths and a 1-acre civic square.
• Beckton Riverside, Newham where up to 2,800 private and affordable homes, subject to planning consents, will be created under the first phase of delivery across a larger site of 28 acres.

Promoting innovation, driving sustainability and creating social value

Recognising the importance of innovation in addressing complex housing challenges, we continued to champion new approaches and technologies to improve the delivery, sustainability and safety of homes. From modular construction to digital design tools, we are harnessing innovation to increase efficiency, reduce costs, and enhance housing delivery.

Sustainability remains a key focus for the Agency. This year we have developed our Living Sustainably statement of intent which defines our sustainability ambitions and how we will work to reflect these goals in our projects and programmes across Homes England.

87% of the completions we’ve enabled in 2023 to 2024 have achieved an Energy Performance Certificate (EPC) rating of B or above. Schemes — such as a 3,500 housing development in Burgess Hill where Homes England is a master developer — will deliver significant improvements in biodiversity once completed.

Increasing social value has underpinned our delivery which is at the heart of every stage of the Agency’s end-to-end process of housing and regeneration. In 2023 to 2024, Homes England undertook an assessment of the social value generated through its investments in 2022 to 2023. The results showed we generated £1.98 of value per pound of investment, as referred to further within the Overview of performance and risk section of this report.

Ensuring the safety of homes and buildings

We also supported the remediation of unsafe cladding. As one of the key delivery partners for the Building Safety Fund (BSF) — set up to remediate unsafe cladding on buildings over 18 metres in height — we have helped to ensure work started on 162 of the 319 buildings in process and that remediation work was completed on 65 buildings to the end of 2023 to 2024.

In July 2023, we also launched the Cladding Safety Scheme, to support remediation of residential buildings over 11 metres in height, (11 to 18 metres in London). In Greater London, the Greater London Authority will continue to operate the Building Safety Fund for buildings over 18 metres in height.

In less than a year from launch, there were 170 applications eligible for the scheme. 148 of these are in contract with a signed grant funding agreement. By the end of March 2024, over 100 were actively procuring work in the market and are engaging with us monthly, with some having submitted works packages and started on site, meaning over 35,000 leaseholders have seen progress on their building at various stages of the programme since its launch.

Our partnerships and our people: the key to delivering our mission

All that we have achieved this year shows what a difference partnership can make, even in difficult economic times, when we work together as a sector to make local visions a reality.

We work with hundreds of organisations including local government, housebuilders of all sizes, including small and medium-sized enterprises (SMEs), housing associations, infrastructure providers, landowners and institutional investors. Working as a catalyst to bring these partners together — nationally, regionally and locally — we have been able to deliver on our commitment to advance housing growth and regeneration.

Across 2023 to 2024 we continued to invest in our people, ensuring we mobilise the passion, multidisciplinary skills and unrivalled national network of strong relationships among our staff to deliver on our mission.

I want to ensure Homes England is a place where everyone here at the Agency can find the opportunity to succeed. We are integrating diversity and inclusion into everything we do to lead by example and to excel in fulfilling our obligations under the Public Sector Equality Duty.

During the year, we furthered our change programmes to modernise the way we work, ensure we have the right organisational design to deliver our strategy and to create the right environment for colleagues to thrive. We wrapped these change programmes up under a banner called Building a Brilliant Place to Work, telling the story of how our transformation projects enabled us to create a better, more effective and efficient work environment for our people.

How we support the market through our interventions

We believe that affordable, quality homes in well-designed places are key to improving people’s lives. We work to together with private, public and third sector organisations to deliver a range of interventions and support to accelerate the pace of house building and regeneration across the country. Many of our funds and interventions can be directly accessed by a broad range of organisations and individuals.

Local Government

Strategic Place Partnerships Affordable Homes Programme —Grant Funding Brownfield Infrastructure and Land Fund —Grant Funding Cladding Safety Scheme — Grant Funding Building Safety Fund Housing Infrastructure Fund Local Government Capacity Centre Local Authority Accelerated Construction Fund

Low and Medium Volume Builders (LMVBs)

Levelling Up Home Building Fund Home Building Fund — Short Term Fund Land Hub — Buying Land from Homes England

Large Housebuilders and Master Developers

Brownfield Infrastructure and Land Fund – Grant Funding Home Building Fund – Infrastructure Loans Home Building Fund – Long-Term Fund Land Hub – Buying Land from Homes England

Lenders and Institutional Investors

Leading Alliances Equity Investments Guarantees Joint Ventures and Partnerships

Building and Home Owners

Help to Buy Scheme Cladding Safety Scheme Building Safety Fund

Affordable Housing Providers

Affordable Homes Programme — Grant Funding Shared Ownership and Affordable Housing 2016 to 2021 (SOAHP) Cladding Safety Scheme — Grant Funding Building Safety Fund Land Hub — Buying Land from Homes England

Highlights of our work include:

Local Government

• We provided 21 local authorities with in-depth support in 2023 to 2024.
• 94% of the 20 reported improved capacity to achieve their place-based ambitions following advice from the Agency.
• We signed 3 new Strategic Place Partnerships (SPPs) in 2023 to 2024.
• The Agency’s 4 SPPs serve a combined population of almost 10 million people.

Low and Medium Volume Builders (LMVBs)

• We supported 119 LMVBs to complete 3,904 homes in 2023 to 2024.
• 63,000 new homes have been built by LMVBs, supported by £2.22 billion of Homes England funding, since 2016.
• We’re developing a new pipeline of small sites for LMVBs to increase their access to land, with regional pilots expected in 2024 to 2025.

Large Housebuilders and Master Developers

• We disposed of 172 hectares of land to major developers in 2023 to 2024, which will support delivery of up to 3,677 homes (including conditional and unconditional disposals).
• Large housebuilders have been supported by almost £1.5 billion of funding (HBF Long-Term Fund and the Home Building Food — Infrastructure Loan) which has unlocked land to build 173,400 homes since 2016.

Affordable Housing Providers

• During 2023 to 2024, around 300 affordable housing providers were supported through Homes England grants.
• More than 22,000 families will have a home to call their own, due to the Agency’s interventions in 2023 to 2024.
• More than 500 new specialist housing units for homeless people and rough sleepers, run by local providers, have been supported by Homes England funding.

Building and Home Owners

• We’ve supported more than 387,000 households into home ownership since 2013.
• Over 35,000 residents and leaseholders started to see progress with their buildings by 31 March 2024 via the Cladding Safety Scheme.
• Remediation works started on 162 buildings and completed on 65, up to the end of 2023 to 2024, through the Building Safety Fund.

Lenders and Institutional Investors

• We co-invest equity into funds, partnerships and joint ventures alongside public and private-sector partners and institutional investors, to stimulate the market and increase delivery.
• The English Cities Fund expanded in 2024 to become a £200 million equity fund matched with commercial lending. This saw an additional £50 million equity from the Agency to boost investment into the significant regeneration of brownfield towns and cities.

Organisational overview

Our purpose and structure

Since 2018, Homes England’s mission has been to increase the supply of quality homes, improve affordability and help create stronger, more vibrant places and communities. We are a national Agency with experts across multiple disciplines based across the country.

Constitutionally, we are a non-departmental public body sponsored by the Ministry of Housing, Communities and Local Government (MHCLG). Our statutory objects are contained in the Housing and Regeneration Act 2008, the legislation creating the Homes and Communities Agency, which in 2018 adopted ‘Homes England’ as its trading name to underpin its mission and purpose.

We are governed by a Board, appointed by the Secretary of State for Housing, Communities and Local Government, led by our Chair, Peter Freeman CBE. Our Chief Executive and Accounting Officer, Peter Denton, leads an executive team that includes specialists in housing, regeneration, land and development, investment, finance and risk management.

Homes England (also referred to as ‘the Agency’) plays a key role in delivering government housing, growth, and regeneration agendas. This often entails supporting national, local or wider market ambitions, through unlocking, de-risking and supporting, which engenders confidence and creation of investible opportunities.

Our ambition is to work in collaboration with equally ambitious partners to deliver the homes and places that our communities need, and to support the regeneration of our towns, cities and rural communities.

We have significant tools at our disposal. We own around 9,000 hectares of land and have substantial capital (loan, grant, equity and guarantees) to deploy. We also have a range of statutory powers and expertise to broker private sector investment, convene stakeholders, facilitate collaboration, improve quality across the industry and champion good practice.

Finally, we have hundreds of experts across an array of specialist areas who can deliver impactful capacity and capability to all that we do.

Whilst some of our partners might choose individual elements of the support we can provide, we often blend many of our interventions together, collaborating with the private, public and third sectors to deliver on local priorities and catalyse change.

We work in collaboration with partners from across the country who share our ambition, including local government, private developers, housing associations, lenders and infrastructure providers. Our activities are designed to respond to local needs, and make a difference where the market alone cannot do so. Robust leadership ensures we deliver best value for money in all of our interventions, including those delivered jointly with our partners.

More detail on our organisational structure and the composition of our Board and Committees can be found in section 3.1, Corporate governance report.

Our Statutory Objects

These are set out in the Housing and Regeneration Act 2008, and are:

a) to improve the supply and quality of housing in England b) to secure the regeneration or development of land or infrastructure in England c) to support in other ways the creation, regeneration or development of communities in England or their continued well-being d) to contribute to the achievement of sustainable development and good design in England.

These objects are with a view to meeting the needs of people living in England

Our Interventions

We intervene in many ways to support the creation of more homes and places where people can live and thrive in England. Our interventions support the development and acceleration of new housing, regeneration and infrastructure through a range of funding schemes, investment projects and land acquisition.

Our interventions span the breadth of housing development:

Single land programme — Land identified, Planning, Infrastructure, Build Out

Help to Buy — Occupation

Land Assembly Fund — Land identified, Planning, Infrastructure, Build Out

Building remediation — Occupation

Housing Infrastructure Fund — Adoption of Local Plan, Land identified, Planning, Infrastructure, Build Out

HBF-STF Home Building Fund — Short Term Fund — Build Out

Levelling Up House Building Fund (LUHBF) — Build Out

Home Building Fund — Long Term Fund and Infrastructure Loans — Land identified, Planning, Infrastructure

Brownfield, Infrastructure and Land — Land identified, Planning, Infrastructure

Local Authority Accelerated Construction Fund — Infrastructure, Build Out

Affordable Homes Programme — Build Out

This is a summary of our interventions, programmes and delivery partnerships:

1 Partnerships

Strategic Place Partnerships — To facilitate a collective commitment to a place’s housing and regeneration ambitions by promoting alignment of priorities and outcomes. Bringing together the strengths of each partner and the resources they can offer to deliver bespoke packages of support for places.

Public-private partnerships — To facilitate partnerships between public and private sector entities to accelerate housing delivery. For example, joint ventures, development agreements, or other forms of collaboration to leverage both public and private resources and expertise.

2 Land and Development

We acquire land or facilitate the preparation of land for development.

Single Land Programme — Investment and disposal of a portfolio of existing public sector assets.

Land Assembly Fund — Fund used to acquire and develop land that requires complex and significant investment prior to commercial development.

3 Infrastructure and Regeneration

We invest in infrastructure projects necessary to unlock housing development opportunities and support regeneration projects in areas facing housing market challenges.

Housing Infrastructure Fund — A capital grant programme of £3.5 billion available to local authorities nationally (outside London).

Home Building Fund — Long Term Fund — £1.7 billion housing infrastructure fund which provides long term loan finance to support any non-housebuilding activity needed to unlock large sites and deliver housing quickly. Activity funded can include land preparation, enabling works, transport infrastructure and the provision of community facilities.

Housing Building Fund — Infrastructure Loans — A £1.5 billion fund to provide loans to private sector partners to invest in transforming predominately brownfield land, improving public transport, building schools, and providing infrastructure to unlock and accelerate new homes.

Brownfield, Infrastructure and Land — A £1 billion fund to tackle the market’s failure to build housing and other uses on challenging sites that demonstrate difficult land assembly and other barriers which prevent the private sector from taking on alone.

Local Authority Accelerated Construction Fund — A £137 million fund to support ambitious local authorities to develop out surplus land holdings at pace, helping to unlock public land and increase the speed of delivery on local authority housing schemes.

4 Market Diversification

We provide support and incentives for developers to participate in housing delivery and overcome barriers to entry into the housing market.

Home Building Fund — Short Term Fund — A £2.2 billion fund to provide loans to developers (where mainstream funding is not a viable option) and equity investments to leverage private sector capital into the residential market.

Levelling Up House Building Fund — A £2 billion fund offering loans to SME housing developers to meet the development costs of building homes for sale or rent, and to unlock and accelerate housing delivery in areas of need across the country, through place-based interventions. In addition, we are able to use this fund flexibly to invest alongside lending partners to form Lending Alliances and to also provide institutional investors with access to a wide range of equity investment opportunities.

5 Affordable Housing

We provide grants or financial incentives to developers to build affordable housing units.

Affordable Homes Programme 2021 to 2026 — A £7.4 billion investment programme that provides grant funding to support the capital costs of developing affordable housing for shared ownership, social rent, affordable rent or sale.

Shared Ownership and Affordable Housing 2016 to 2021 (SOAHP) — A grant programme of £4.9 billion to support the capital costs of developing affordable housing (closed to new bids in 2021).

6 Home Ownership

Help to Buy — The Agency has transitioned its role in the Help to Buy scheme to one of stewardship, as the scheme closed to new applications in 2022, with completions continuing until 2023. The focus is on the effective management of the £17.4 billion equity loan portfolio.

7 Building Remediation

Cladding Safety Scheme — The Cladding Safety Scheme, part of the wider Building Safety Programme, is formally delegated to Homes England for delivery. The scheme is designed to meet the cost of addressing life safety fire risks associated with cladding on residential buildings over 11 metres in height (11 to 18 metres in London).

8 Acting as a delivery partner for government

Building Safety and Remediation — Acting as a delivery partner through the Building Safety Fund and Private Sector Cladding Remediation Fund to provide non-recoverable grants to building owners outside London to replace unsafe cladding systems.

Homeless and rough sleepers — Acting as a delivery partner for MHCLG through the Single Homelessness Accommodation Programme, the Rough Sleeping Accommodation Programme and Next Steps Accommodation Programme.

Housing guarantees — Supported by MHCLG’s balance sheet, we help partners to access private finance and long-term, low cost, fixed rate loans to fund their development programmes.

9 Other

Land Hub Portal — We own around 9,000 hectares of land. The Land Hub Portal is our online tool which acts as a shop window for housebuilders, giving potential developers details of all land available to buy from us.

Supporting best practice

Local Government Capacity Centre — The LGCC designs and curates structured, seasonal learning programmes for local authority colleagues and their partners.

Design and sustainability — Across all of our interventions, we work closely with partners to embed and promote excellence in design and sustainability.

Modern Methods of Construction (MMC) — Through all of our work, we encourage partners to deliver homes using forms of MMC which bring the greatest innovation, productivity or sustainability benefits.

Our values

It is crucial Homes England is a place where everyone can flourish personally and professionally. The Agency is a supportive environment which provides colleagues with opportunities to develop their skills, learn from others, and have access to the tools and infrastructure they need to deliver.

Our values framework, launched in May 2023, is at the heart of our Agency, representing our core beliefs and what we stand for. A collaborative redesign of our values was undertaken in 2023 by our Shadow Leadership Board — a group made up of volunteers at all levels from across the Agency to hold our Executive Leadership Team (ELT) to account — helping to influence the direction of Homes England and contribute to positive change by giving a voice to new and different perspectives. Following this process, we renewed our values to better align with our strategic plan. We also introduced our associated behaviours framework which is embedded into our performance expectations and our day-to-day narrative.

We are…

• Respectful — As the core principle, this runs through all our values and behaviours
• Impactful — We combine our commercial expertise with social purpose to deliver value for money and maximise our positive impact
• Accountable — We are empowered to lead by example, take responsibility for our actions and speak up for what’s right
• Innovative — We are bold, creative thinkers who embrace change, never stop learning and always look for a better way to do things
• Collaborative — We share information, align priorities, and use our collective knowledge and experience to achieve great results

We know that our colleagues are our greatest asset. We recognise that our diversity will enable us to best understand the housing and place needs of the communities we serve and in turn help us achieve our mission to drive regeneration and housing delivery to create high-quality homes and thriving places.

Overview of performance and risk

Overview of performance

In 2023 we launched our strategic plan, refreshing our mission and strategic objectives to meet housing and regeneration priorities for the sector.

While continuing to target improved housing supply, the new plan required us to place a greater emphasis on urban renewal, regeneration, sustainability, design quality and safety, and creating a sector that works for everyone.

With the shift in strategic direction, we adopted a suite of 18 Key Performance Indicators (KPIs), which reflect the breadth of our strategic mandate. The KPIs comprise a mix of housing delivery indicators and gauge the degree to which we enable our partners and the sector to deliver.

They also support place-based regeneration and encompass the wider socio-economic benefits stemming from our activities. The KPIs also gauge the health of the Agency and promote further improvements in design quality and sustainability.

Performance against 11 of our 18 KPIs is currently being reported, with the remainder planned to report for 2024 to 2025. This summary provides an overview of our performance in 2023 to 2024 towards delivering our strategic objectives. This high-level overview is expanded upon in section 2.2, Performance analysis.

Strategic objective 1 — Vibrant and successful places

To support the creation of vibrant and successful places that people can be proud of, working with local leaders and other partners to deliver housing-led, mixed-use regeneration with a brownfield-first approach.

Priority outcomes

• More land reused and made available for regeneration.
• Key enabling infrastructure in place to unlock development.
• Local places supported to deliver on their regeneration ambitions.
• Mixed-use places that create value and benefit local communities.

Key performance indicators reporting in 2023 to 2024

KPI 4a — Total number of local authorities receiving in-depth support from Homes England… KPI 4b — … of which share who report improved capacity to deliver their place-based ambitions as a result KPI 5 — Social value per pound of investment

Summary

Our place-based approach has led to a substantial rise in the number of local authorities receiving in-depth support, with the number increasing from 9 to 21. The feedback received from these authorities has been overwhelmingly positive, with 94% acknowledging that their capacity to pursue their local ambitions has been bolstered through our support.

Increasing social value underpins our delivery. We have combined commercial expertise with social purpose to deliver social value across all communities served through our interventions. Social value is considered at every stage of our housing and regeneration process. In 2023 to 2024, we undertook an assessment of the social value generated through our investments in 2022 to 2023. The results showed we generated £1.98 of value per pound of investment.

Strategic objective 2 — Homes people need

To facilitate the creation of the homes people need, intervening where necessary to ensure places have enough homes of the right type and tenure.

Priority outcomes

• More homes of the right type in the right places.
• More land available for new homes and barriers to development removed.
• More people enabled to own their own home.

Key performance indicators reporting in 2023 to 2024

KPI 6 — Total number of housing completions directly supported

KPI 7 — Total housing capacity of land unlocked by Homes England interventions

KPI 8 — Total number of households supported into home ownership

Summary

Despite the economic context and a subdued market, we delivered within our housing delivery target ranges and in most cases exceeded the central target. Our efforts made a significant impact on the housing sector, facilitating the completion of 32,320 homes, unlocking a further 26,273 homes, and supporting 622 households into home ownership as the Help to Buy scheme and First Homes pilot drew to a close.

Strategic objective 3 — A housing and regeneration sector that works for everyone

We have a vital role to play in building a housing and regeneration sector that works for everyone; driving diversification, productivity, partnership working and innovation.

Priority outcomes

• A more diverse sector with greater competition.
• A more productive housebuilding sector with more private sector investment in housing and regeneration.
• More private sector investment in commercial property and mixed-use regeneration in urban centres.

Key performance indicators reporting in 2023 to 2024

KPI 9 — Share of supported completions by low and medium volume builders (LMVBs)

Summary

The emphasis on creating a diverse and inclusive sector is evident through our ongoing collaboration with LMVBs. In 2023 to 2024 we targeted £400 million of funding to LMVBs to increase sector capacity and capability, and to overcome barriers to entry in the housing market. 19% of our housing completions are now being delivered by smaller builders.

Strategic Objective 4 — High-quality homes in well-designed places

To promote the creation of high-quality homes in well-designed places that reflect community priorities, in line with our design assessment tool ‘Building for a Healthy Life’ (BHL) and national and local design codes.

Priority outcomes

• More integrated neighbourhoods with access to nature and amenities facilitated by walking, cycling and public transport.
• Distinctive places that reflect local character.
• Streets, public space, and blue and green infrastructure that are designed for people to use, easy to navigate and have a well-considered relationship between public and private spaces.

Key performance indicators reporting in 2023 to 2024

KPI 12 — Share of supported schemes that meet or exceed the agreed standards for design quality (in line with BHL)

Summary

Although in the early stages of reporting, 88% of our supported schemes meet or exceed the agreed standards for design quality.

Strategic Objective 5 — Sustainable homes and places

To ensure high standards of sustainability and design quality are delivered in homes and places.

Priority outcomes

• more energy efficient, carbon efficient and resource efficient homes and places both in-use and across their whole life
• places that enhance the natural environment, including air and water quality, biodiversity, and habitats

Key performance indicators reporting in 2023 to 2024

KPI 13 Building Performance — share of supported completions that are EPC rating B or above

Summary

87% of the completions we’ve enabled in 2023 to 2024 have achieved an Energy Performance Certificate (EPC) rating of B or above.

Strategic Objective — Achieving our plan

To sustain the organisational health required to achieve our strategy by operating as a high performing organisation.

• An Agency that works for its partners.
• An Agency that reflects the communities it serves.
• An Agency that effectively manages risk.

Key performance indicators reporting in 2023 to 2024

KPI 16 — Share of partners reporting overall satisfaction with Homes England

KPI 17 — Average colleague rating for Homes England being a diverse and inclusive employer

KPI 18 —Number of principal risks outside risk appetite

Summary

68% of our partners are satisfied with Homes England, with an additional 23% neutral.

Our colleagues rated Homes England 7.2 out of 10.

There were 4 principal risks outside appetite at the end of 2023 to 2024.

Risk overview

As a public sector organisation, the Agency places a significant emphasis on effective risk management. The publication of Homes England’s strategic plan in May 2023 led to elevation of the Agency’s approach to risk. During the third quarter of 2023 to 2024, our profile peaked with 6 out of 8 principal risks out of risk appetite. However, this reduced by the end of the financial year to 4 outside of appetite. Whilst we are pleased with the improvements, these risks remain subject to ongoing strategic mitigations.

With a significant portfolio of change across the organisation, change management risk is a key focus requiring us to remain vigilant. Sound decisions as to what, when and how we introduce change is critical, as is balancing our budgets with our strategic goals and risk appetites.

Following the year end, the Agency has enhanced its risk management capabilities by integrating Anti-Economic Crime and Compliance functions into the risk function. This move aims to improve coordination, streamline processes, and foster synergy among these areas. Additionally, there will be increased connectivity and analytical capabilities with other risk specialist areas, such as cyber security and data protection, to address emerging risks effectively. Overall, this strategic decision underscores the Agency’s commitment to maturing its Risk Management Framework and ensuring resilience in today’s complex environment.

Our 8 principal risks are set out here.

Quarter 1 2023 to 2024

Risks inside appetite:

• Funding (misalignment)
• Business continuity
• Macro-economic
• Delivery Partners
• Value for Money

Risks outside appetite:

• Change management
• Capacity and Capability
• Cyber Security (split from Business Continuity Risk during quarter 3 2023 to 2024)

Quarter 4 2023 to 2024

Risks inside appetite:

• Macro-economic
• Delivery Partners
• Cyber Security (split from Business Continuity risk during quarter 3 2023 to 2024)
• Value for Money

Risks outside appetite:

• Funding (misalignment)
• Change management
• Business continuity
• Capacity and Capability

Appetite for Funding Misalignment has shifted from ‘Open’ to ‘Averse’, risk moved to being out of appetite (no change in risk score)

Further information on these risks, including the current position and risk mitigations, are detailed within Principal risks in section 2.2, Performance analysis.

Additionally, the Agency’s Risk Management Framework is set out in the Governance Statement within section 3.1, Corporate governance report.

Going concern

The net asset position of Homes England takes into account liabilities falling due in future years which, to the extent that they may not be met from Homes England’s other sources of income, may only be met by future grants or grant in aid from our sponsoring department, the Ministry of Housing, Communities and Local Government (MHCLG).

Grants may not be issued in advance of need. Grant in aid for the year ending 31 March 2025, taking into account the amounts required by our liabilities falling due in that year, has been approved by Parliament.

The recent Public Bodies Review in 2023 concluded that there is a clear continuing need for a public body like Homes England to deliver its statutory objectives and that the Agency is the right vehicle to deliver these. There is therefore no reason to believe that future grant in aid approvals will not be forthcoming.

Additionally, as Homes England and MHCLG have previously agreed a rolling 5-year business plan and delegated authority limits for the period, the board considers it appropriate to adopt a going concern basis for preparation of the Agency’s Financial Statements.

2.2 Performance analysis

This section highlights Homes England’s performance against our strategic plan and key performance indicators. It expands on the performance overview and outlines any factors which have influenced our delivery performance within the context of the market sector and wider economy.

The section also describes the principal risks impacting delivery, provides a review of financial performance during the year, and highlights the work being undertaken by the Agency in relation to sustainability and climate change.

Detailed performance review

In 2023 and 2024, we launched our strategic plan. At its heart, the plan strives to ensure people have access to sustainable, quality homes nestled within thriving, dynamic communities.

As well as driving the delivery of more homes, our plan places an emphasis on place, regeneration, sustainability, design quality, and safety, while championing a housing sector that addresses the needs of all stakeholders.

The economic environment of the past few years had a significant impact on the housing market and our partners. During 2023 and 2024, economic growth remained sluggish, and the housing market was subdued. Despite the challenging context, we continued to support partners to increase housing supply and, in most cases, exceeded our delivery targets. We also provided support through our investment in affordable and specialist housing.

In addition to nurturing existing partnerships, we forged new alliances, reflecting our shift in focus from housing supply to a more holistic approach that encompasses place. By pooling our resources, be it powers, land, capital or expertise, we’ve initiated Strategic Place Partnerships (SPPs) with local leaders whose aspirations align with our strategic vision. Collectively these SPPs serve a population of almost 10 million people. The independent Public Bodies Review (PBR) endorsed our commitment to our strategic initiatives and underscored our important role as a significant national public entity.

Our strategic mandate

Our strategic plan is founded on a mission to create high-quality homes in thriving places. While continuing to target new housing supply the plan also places an emphasis on regeneration, sustainability, design quality and safety, and creating a sector that works for everyone.

Underpinning these aspirations, our comprehensive performance framework helps to steer progress towards these strategic objectives. This performance framework connects strategic direction to execution by linking strategy through to business planning, performance reporting, performance reviews, and evaluation activities.

The linked processes are underpinned by a common set of key performance indicators (KPIs), which reflect the breadth of the Agency’s strategic mandate. The 18 KPIs extend beyond measures of new housing supply to encompass the wider socioeconomic benefits stemming from the Agency’s activities. They also gauge the degree to which the Agency enables partners to deliver, our impact on the sector and the health of the Agency.

Our mission

We drive regeneration and housing delivery to create high-quality homes and thriving places. This will support greater social justice and the creation of places people are proud to call home.

KPI 1, KPI 2, KPI 3, KPI 4, KPI 5 — We support the creation of vibrant and successful places that people can be proud of, working with local leaders and other partners to deliver housing-led, mixed-use regeneration with a brownfield-first approach.

KPI 6, KPI 7, KPI 8 —We facilitate the creation of the homes people need intervening where necessary to ensure places have enough homes of the right type and tenure.

KPI 9, KPI 10, KPI 11 — We build a housing and regeneration sector that works for everyone, driving diversification, partnership working and innovation.

KPI 12 —We promote the creation of high-quality homes in well-designed places that reflect community priorities by taking an inclusive and long-term approach.

KPI 13, KPI 14, KPI 15 — We enable sustainable homes and places, maximising their environmental impact.

KPI 16, KPI 17, KPI 18 — Achieving our plan.

Following publication of the strategic plan, we implemented our new key performance indicators, with the first tranche of indicators reporting in 2023 and 2024 with a baseline established against future benchmarks and targets.

KPI	KPI description	2023 and 2024 performance
4a	Total number of Local Authorities (LAs) receiving in-depth capacity support	21
4b	Total number of LAs receiving in-depth support who report improved capacity	94%
5	Social value per pound of investment	£1.98
6	Number of homes completed	32,320
7	Number of homes unlocked	26,273
8	Number of households supported into home ownership	622
9	Share of supported completions by LMVB builders	19%
12	Share of supported schemes that meet or exceed the agreed standards for design quality (in line with Building for a Healthy Life)	88%
13	Share of supported completions that are EPC rating B or above	87%
16	Share of partners who report overall satisfaction	68%
17	Employee rating for diversity and inclusion	7.2 (out of 10)
18	Number of principal risks outside appetite	4 at the end of 2023 to 2024

The second tranche of indicators will begin reporting from 2024 and 2025 with the results providing a baseline against which future benchmarks and targets can be set.

KPI 1 — Brownfield land reclaimed KPI 2 — Employment floorspace created KPI 3 — Number of jobs created KPI 10 — Share of supported completions using modern methods of construction (MMC) KPI 11 — Total value of private sector funds leveraged KPI 14 — Average percentage biodiversity net gain planned on supported schemes KPI 15 — Indicator to be developed on embodied carbon of Homes England supported development

Delivering on our strategy: vibrant and successful places

One of our objectives is to support the creation of vibrant and successful places that people can be proud of, working with local leaders and other partners to deliver housing-led, mixed-use regeneration with a brownfield-first approach.

Our desired outcomes are:

• more land reused and made available for regeneration
• key enabling infrastructure in place to unlock development
• local places supported to deliver on their regeneration ambitions
• mixed-use places that create value and benefit local communities

Driving locally-led housing development and regeneration

During the financial year we made a significant shift towards place-based working. At its core, place-based working is about bringing together our skills, expertise and resources into bespoke packages of support for places. We work with local leaders and the private sector in areas facing market challenges, to advance locally led housing and regeneration priorities. This involves revitalising existing neighbourhoods, repurposing under-utilised land or buildings, undertaking long-term planning, and improving housing quality and affordability in disadvantaged communities. Closely aligned to our SPP activity, and centred around shared priorities and objectives, our work in 2023 and 2024 has included support for the following places; Blackpool, Cambridge, central Leeds, Liverpool, central London, Sheffield and Wolverhampton.

The locally led approach is demonstrated by the Sheffield Together partnership. This is a 5-way partnership between Homes England, Sheffield City Council, Sheffield Property Association, South Yorkshire Housing Partnership and South Yorkshire Mayoral Combined Authority. The partnership has come together to support the city’s need to build 40,000 new homes over the next 20 years. Strong progress has been made over the past 2 years. Delivery plans have been developed for 48 sites with the capacity for approximately 5,700 homes, along with a plan for creating 3 new neighbourhoods at Furnace Hill and Neepsend, Moorfoot, and Sheffield Station Campus. The first stage of the masterplan for Furnace Hill and Neepsend was produced in 2023. In March 2024, the transformation of the sites was kickstarted with £67 million of investment for land assembly and enabling works across 12 acres of brownfield and under-utilised land.

During 2023 and 2024, we also made considerable progress in advancing other projects around England including Barrow, Bristol, Newcastle, Plymouth and York. In March 2024 we completed the York Central Development Agreement between the Agency, Network Rail and a developer partner. This agreement is a significant milestone for a site that has failed to leverage private sector investment for nearly 30 years. Once complete, the regeneration of the area is projected to deliver 2,500 homes and add £1.1 billion of gross value per year, growing the economy of York by 20%.

Over the next 25 years our strategic partners will provide in York Central:

• 2,500 homes
• 1 million square foot of commercial space
• up to 6,500 jobs
• half the 45 hectares as open space

Building on Strategic Place Partnerships

During 2023 and 2024, we established 3 SPPs with South Yorkshire Combined Authority, West Yorkshire Combined Authority (WYCA) and the West Midlands Combined Authority. These join our existing SPP with Greater Manchester Combined Authority.

Each SPP facilitates a collective commitment to a place’s housing and regeneration ambitions by aligning priorities and outcomes, bringing together the strengths of each partner and pooling the resources they can offer.

Our SPP with WYCA was signed in May 2023. Over the year, the partnership made significant progress against delivery priorities in cities including Bradford, Dewsbury and Leeds. Working with Bradford Council and WYCA, we are driving the project to repurpose the former retail heart of Bradford city centre to create Bradford City Village — a green, healthy and sustainable neighbourhood. We are also supporting the comprehensive regeneration of Leeds city centre, including the delivery of 20,000 new homes and a new British Library North.

Our SPP with Greater Manchester is focused on delivering a step change in housing growth. So far it has enabled the deployment of skills and capacity to support over 30 projects across 6 growth locations, spanning ten local authorities. This includes supporting the regeneration of Stockport town centre, with up to 5,500 additional homes in the Red Bank neighbourhood, and delivery of new affordable housing in Salford.

Garden communities

There are other place-based projects we support across the country. These include garden communities where we take a coordinated approach to providing direct delivery support and capacity funding. Examples include St Cuthbert’s Garden Village in Carlisle and the Worcestershire Parkway in the Midlands; both new settlements plan to deliver 10,000 homes. We are also providing support for the planning and delivery of a number of regional priorities, including the Thames Estuary which is home to approximately 3.6 million people and spans 19 local authorities.

Supporting local authorities to build local capacity

Through activities like those detailed, we provided in-depth support to 21 local authorities (LAs) in 2023 and 2024, ranging from investment, funding and advice. Of those accessing non-financial support, 94% reported improved capacity to achieve their place-based ambitions, with an increasing acknowledgment of our role as an enabler and facilitator.

KPI 4

a) Total number of local authorities receiving in-depth capacity support from Homes England…. b) … of which share who report improved capacity to deliver their place-based ambitions as a result.

Purpose — To demonstrate our contribution and perceived effectiveness of our in-depth support to local authorities to deliver their place ambitions and local housing priorities.

Measure — 21 local authorities receiving in-depth capacity support, of which 94% report improved capacity to achieve their place-based delivery ambitions. The reported number for KPI 4b of 94% relates to 20 local authorities.

Kate Josephs CB, Chief Executive, Sheffield City Council said: “Sheffield City Council has been working very closely in partnership with Homes England over the past 2 years, since the establishment of the Sheffield Housing Growth Board in December 2021.

“This partnership has resulted in a much more collaborative approach towards the delivery of new homes in the city. Joint working has seen Homes England tailor its powers, funding, expertise and technical skills, towards assisting the Council to bring forward 3 new neighbourhoods in Sheffield City Centre, capable of delivering 5,000 new homes.

“Great support has also been received with building a wider land pipeline for future housing sites, as well as an integrated affordable homes programme. Our partnership working is very strong and is greatly welcomed by all local stakeholders.”

Benefitting local communities by creating social value

Our interventions in place not only deliver homes and unlock housing capacity, but create employment opportunities, provide vital local facilities and generate wider social value. Increasing social value has underpinned our delivery. It is at the core of all we do at Homes England and is considered at every stage of our housing and regeneration process. We combine commercial expertise with social purpose to deliver social value across all communities served through our interventions.

In 2023 and 2024, we undertook an assessment of the social value generated through our investments made in 2022 and 2023. Based on more than 1,500 project approvals in 2022 and 2023, we forecast to deliver £4.6 billion of social value from £2.3 billion of our investment. This means we are set to generate £1.98 of value per pound of investment.

KPI 5 — Social value per pound of investment

Purpose — To quantify and value the expected impact on people’s wellbeing as a result of our funding.

Measure — A forecast of expected benefits per pound of investment calculated bottom-up, project-by project, on projects with funding approval activity in the financial year 2022 and 2023. We use social value estimates across the lifetime of a project and add together the social value of all our projects approved during the financial year to estimate the Agency’s impact. We consider social, environmental, and economic impacts (costs and benefits) that are evidenced and attributable to our actions.

For every £1 of funding we approved in 2022 and 2023 we expect to generate £1.98 in social value.

Our role in delivering the largest new town in England at Northstowe in Cambridgeshire provides a good example of where we advocate delivery of locally relevant social value through our interventions. As well as the delivery of requirements relating to affordable housing and biodiversity net gain, we work with our partners to support activities which contribute to community enlivenment. This ranges from sponsoring local events on our land, community art projects, providing access to recreational facilities, and career events.

Through our interventions in York Central we have added nearly £6 million of social and local economic value to the area, having liaised with over 1,000 members of the community. Amongst achievements, we have improved 12 local green spaces, provided local people with full-time employment opportunities, supported 25 charity fundraising activities, and diverted over 370 tonnes of waste from landfill.

Delivering on our strategy: homes people need

Our objective is to facilitate the creation of the homes people need, intervening where necessary to ensure places have enough homes of the right type and tenure. We work to:

• create more homes of the right type in the right place
• ensure more land is available for new homes and barriers to development are removed
• ensure more people can own their own home

A subdued housing market

The economic environment of recent years had a significant impact on the housing market. Despite its challenges, 2023 and 2024 was a more stable year, although the housing market was subdued, and consumer confidence remained weak.

Economic growth was stagnant in 2023 and 2024 with Gross Domestic Product increasing by 0.2% compared to the previous financial year. Inflation fell from a high of 8.7% at the start of 2023 and 2024 to 3.8% at the end. The Bank of England base rate rose by a percentage point to 5.25% in the same period, while unemployment crept up from 4% to 4.4%. House prices were 1.8% higher at the end of 2023 and 2024 than a year earlier.

After a 26% fall in 2022 and 2023 in net reservations for new build homes, these only recovered by 3%, leaving them on average 21% lower than the previous 3 financial years. Mortgage rates remained volatile, with rates rising in the early part of the year. Although mortgage rates fell from the August 2023 peak, they are relatively high by the standards of the past 15 years.

Higher interest rates constrain spending and investment which stymies economic growth. This contributed to a weakening in demand for housing with residential transactions in England declining by 19%. As a consequence, volume housebuilders slowed development activity during the year, with several warning that they would deliver fewer homes.

Overall, residential new build output in financial year 2023 and 2024 was 5.4% lower than in financial year 2022 and 2023 and 2.5 % below 2021 and 2022 levels (as measured by the number of Energy Performance Certificates registered).

A slow-down in development saw a corresponding slow-down in land sales. This impacted land valuations. According to Savills, UK greenfield and urban land values fell in 2023 and 2024 by 4.8% and 6.5%, respectively, compared to the previous year. The fall in land values, together with the challenging market conditions, made it harder to reach agreements on land disposals.

Some developers became more cautious, with volume housebuilders slowing activity during the year, extending contracting and delivery timeframes. This slowed progress on some sites and impacted the ability to convert disposals of land to housing starts. In England, provisional statistics for calendar year 2023 indicate a drop of more than 15% in the total number of housing starts between 2022 to 2023, and an 11% decline in housing completions.

Chart: Year on Year % change in housing starts in England

Source: Ministry of Housing, Communities and Local Government — Table 213: permanent dwellings started and completed, England

This diagram could not be made accessible. Please refer to the PDF version of this document. If you use assistive technology (such as a screen reader) and need a version of this document in a more accessible format, please email enquiries@homesengland.gov.uk. Please tell us what format you need. It will help us if you say what assistive technology you use.

Robust performance

During the year, the Agency delivered within our housing delivery target ranges and, most cases, exceeded the central target. Our efforts facilitated the completion of 32,320 homes, unlocking a further 26,273 homes and supporting 622 households into home ownership as the Help to Buy scheme and First Homes pilot drew to a close.

		Outturn	Outturn v Target
PI 3	Total number of housing starts directly supported	35,676	108%
KPI 6	Total number of housing completions directly supported	32,320	109%
KPI 7	Total housing capacity of land unlocked by Homes England interventions	26,273	102%
KPI 8	Total number of households supported into home ownership	622	98%

Some of the information in this diagram could not be made accessible. Please refer to the PDF version of this document. If you use assistive technology (such as a screen reader) and need a version of this document in a more accessible format, please email enquiries@homesengland.gov.uk. Please tell us what format you need. It will help us if you say what assistive technology you use.

Providing a secure place to live

The numerical outputs only offer a glimpse into the impact that our interventions have on improving people’s lives. As a result of our investment in affordable housing during 2023 and 2024, over 22,000 families will have a home they can call their own and fewer children will risk living in temporary accommodation. We allocated all our affordable housing funding during the year, exceeding our affordable housing targets with 24,282 completions and 29,067 starts.

The Great Places housing group is one of our affordable housing strategic partnerships. They have used our funding to deliver affordable social housing by regenerating Ancoats Dispensary. This Grade 2 listed building in Ancoats, Manchester, which had stood derelict for more than 30 years, is now providing 39 high quality affordable homes.

Moreover, in 2023 and 2024 we supported over 500 specialist housing units for the homeless and rough sleepers, acting as a delivery partner through the Single Homelessness Accommodation Programme, the Rough Sleeping Accommodation Programme and Next Steps Accommodation Programme. Through this suite of interventions, we have ensured fewer people are left exposed to the elements while sleeping rough through schemes such as Cowlins Mill, Cornwall and Bradbury Mansions, Southend on Sea.

The Cowlins Mill scheme uses 0.62 acres of council owned brownfield land to provide ten move-on modular homes. While the units are self-contained, the scheme provides additional communal cooking, laundry, classroom, management and break-out spaces to encourage skills-based learning programmes and facilitate high-quality client support spaces.

Bradbury Mansions in Southend on Sea was completed in March 2024. The site consists of 3 houses reconfigured into 23 units for rough sleepers, offering a holistic approach to temporary accommodation with varying levels of support provided dependent on need.

Unlocking housing development

In addition to supporting the construction of new homes, the Agency plays a vital role in acquiring land and complex stalled developments. We invest in roads, utilities and other essential infrastructure, necessary to unlock housing development opportunities on these sites. In 2023 and 2024, we unlocked 26,273 homes, more than double the homes we unlocked in 2022 and 2023.

We work with partners to bring challenging sites to market and act as a catalyst for broader housing development and urban regeneration. The acquisition of Quayside West in Forth Yards, Newcastle is a prime example. This acquisition demonstrates our commitment to fostering sustainable urban development and will kickstart the creation of 1,100 high-quality homes. Notably, this intervention serves as a catalyst for revitalising an area in the city that has remained derelict for over 2 decades. The site faces a number of viability challenges, access constraints and infrastructure requirements, all of which stopped the private sector from bringing it forward. Bringing the site into public sector ownership allows it to reach its full potential as part of the wider transformation of Forth Yards.

Last year, the Agency also forged a ground-breaking partnership with the Greater London Authority (GLA) and the Berkeley Group. This collaboration is poised to bring about transformative change, particularly for communities in the London boroughs of Newham and Southwark. Through this partnership, we are spearheading the acceleration of several major brownfield regeneration projects, delivering over 8,000 new homes. A significant portion of these homes will be made affordable, addressing the pressing need for accessible housing in the region. The first homes should be ready in 2027 alongside commercial and leisure facilities, a secondary school, parks, and significant new transport infrastructure. All delivering fantastic social and economic outcomes for the area.

Tom Copley, Deputy Mayor of London for Housing and Residential Development said: “I’m delighted that 8,000 new homes are being delivered in Newham and Southwark, with 40% of these set to be genuinely affordable on the 2 sites with planning permission.

“This partnership between the GLA, Berkeley and Homes England marks another important step forward in our mission to utilise brownfield land to deliver more high quality, affordable new homes in the capital. The new public green spaces and fantastic transport links will have huge benefits for future residents and the wider community — helping to build a better, fairer, more prosperous London for all.”

Supporting home ownership

Over the last decade, we have helped over 387,000 households secure their own home using a Help to Buy Equity Loan.

Since 2013 Help to Buy has:

• provided £24.7 billion of equity loans, with over 154,000 loans repaid
• helped more than 387,000 households into home ownership, of which almost 85% were first time buyers
• supported the purchase of 1 in 3 new homes, with the value of all homes purchased totalling over £109 billion

Following the closure of the Help to Buy scheme to new applicants, we are focused on our stewardship role, ensuring value for money through our custodianship of the £17.4 billion equity loan portfolio. This has involved transitioning responsibility for administrative services to a third-party, improving the effectiveness of our customer services and supporting over 230,000 households with a Help to Buy equity loan manage their accounts.

We continue to strive for excellent customer service, as homebuyers manage the lifetime of their loans with us. In the medium term, subject to funding, we propose to introduce new digital capabilities and services to help customers manage their loans. In line with the recommendations of the Public Bodies Review, this will provide greater service resilience in the face of fluctuating levels of customer demand, by reducing reliance on call-centre capacity.

As part of our data enrichment plan, we are committed to our alignment to financial services best practice in relation to identifying and supporting vulnerable customers. We continue to improve the understanding of the Help to Buy portfolio’s behaviour and how we are best positioned to support our customers with their home ownership journey.

With the Help to Buy scheme closing to new applicants, we continued to support home ownership through the First Homes scheme. The scheme, aimed at first time buyers, was launched in August 2021 to reduce some of the barriers to home ownership, by offering first time buyers a discount in perpetuity. Grant funding was also made available to developers to support scheme delivery. Phase 2 delivered 1,231 homes in total across 2022 and 2023 and 2023 and 2024, involving 20 developers over 99 sites and 67 local authorities. The pilot successfully concluded in October 2023, having helped deliver 514 homes during the year. In addition, the first resales have materialised, increasing the number of first-time buyers who will benefit from a first home.

Providing the homes people need — lifetime performance

We intervene in many ways to facilitate the delivery of the homes people need. Our interventions are supported through a range of loan finance and grant funding programmes, whose business cases have lifetime performance targets. Following the successful reset of some programme business cases in 2023 and 2024, we are tracking to achieve the lifetime objectives for 8 of our 11 largest programmes. The major programmes due to end shortly, the Home Building Fund Short-Term Fund, and the Shared Ownership and Affordable Housing 2016 to 2021 (SOAHP), will exceed their lifetime delivery targets.

Table: Lifetime programme performance in the Affordable Housing strand

Investments	Lifetime objective	Delivery to date	Lifetime forecast	Funding allocation	Actual expenditure	Forecast outturn
SOAHP 2016 to 2021, to end of 2023 and 2024	132,000 starts	133,557 starts	133,557 starts	£4.9 billion	£4.9 billion	£4.9 billion
Affordable Homes Programme 2021 to 2026, to end of 2026 and 2027	97,500	48,795 starts	100,000 starts	£7.4 billion	£3.7 billion	£7.4 billion

Table: Lifetime programme performance in the Market Diversification strand

Investments	Lifetime objective	Delivery to date	Lifetime forecast	Funding allocation	Actual expenditure	Forecast outturn
Levelling-Up Home Building Fund, to end of 2032 and 2033	42,475 starts (9,300 UHC or MMC)	4,167 starts (direct), 8,500 UHC or MMC	42,773 starts (9,500 UHC or MMC)	£2 billion	£303 million	£1.5 billion
HBF Short-Term Fund, to end of 2028 to 2029	43,000 homes	51,185 homes	58,851 homes	£2.2 billion	£1.92 billion	£2.27 billion

Levelling-Up Home Building Fund figures based on no extension of the fund to commit beyond end of March 2025.

Table: Lifetime programme performance in the Infrastructure strand

Investments	Lifetime objective	Delivery to date	Lifetime forecast	Funding allocation	Actual expenditure	Forecast outturn
Home Building Fund — Infrastructure Loan, to end of 2026 and 2027	100,000 to 116,000 homes unlocked	15,003 homes unlocked	107,465 homes unlocked	£1.5 billion	£45 million	£1.5 billion
HBF Long-Term Fund, to end of 2022 and 2023	160,000 homes unlocked	158,435 homes unlocked	158,435 homes unlocked	£1.7 billion	£1.412 billion	£1.725 billion
Brownfield, Infrastructure and Land, to end of 2028 and 2029	40,000 homes unlocked	3,713 homes unlocked	40,000 homes unlocked	£1 billion	£33 million	£1.1 billion
Housing Infrastructure Fund, to end of 2023 and 2024	283,496 homes unlocked	282,774 homes unlocked	282,774 homes unlocked	£3.5 billion	£1.3 billion	£3.5 billion
LA Accelerated Construction, to end of 2027 and 2028	Up to 10,000 homes	5,686 starts	9,425 starts	£137 million	£137 million	£137 million

Lifetime programme performance in the Land strand

Investments	Lifetime objective	Delivery to date	Lifetime forecast
Land Assembly Fund	34,000 starts	4,994 starts	40,000 starts
Single Land Programme	No targets set post Public Sector Land	No targets set post Public Sector Land	No targets set post Public Sector Land

The Land Assembly Fund is recycling fund with £657m secured at Spending Review 2021. The Single Land Programme is recycling fund with £817m secured at Spending Review 2021.

The 2 principal exceptions are the Housing Infrastructure Fund (HIF) and Local Authority Accelerated Construction (LAAC) programmes. Due to cost inflation, several local authorities have withdrawn projects from HIF, with budget re-allocated to existing projects. Following the completion of the infrastructure element of projects, local authorities have, in several instances, reassessed planned housing delivery and revised downwards the number of homes that will be delivered. As a result, the LAAC lifetime forecast has been revised downwards.

Delivering on our strategy: a housing and regeneration sector that works for everyone

We have a role to play in building a housing and regeneration sector that works for everyone; driving diversification, productivity, partnership working and innovation. Our desired outcomes for this strategic objective are to facilitate:

• a more diverse sector with greater competition
• a more productive housebuilding sector with more private sector investment in housing and regeneration
• more private sector investment in commercial property and mixed-use regeneration in urban centres

A sector for all

As a result of the challenging economic climate, the sector continues to experience issues around capacity, build costs, contractor availability, and access to investment. It also faces additional challenges in addressing building safety, improving existing stock, and environmental requirements.

In many areas the sector is not working efficiently and smaller developers, restricted by their scale of operation, face barriers to entry.

We play a central role in tackling the housing challenges the country faces, but we don’t do it alone. We work with over 5,000 partners and organisations, including local government, housebuilders of all sizes, housing associations, infrastructure providers, landowners and institutional investors. Our ambition is for a competitive, diverse, resilient and efficient sector.

Diversifying and growing the sector

Our emphasis on creating a diverse and inclusive sector is evident through the ongoing collaboration with low and medium volume builders (LMVBs). These builders support our ambition for diversity beyond the larger volume builders who currently deliver a higher proportion of homes. LMVBs are vital in bringing forward smaller development sites and delivering additional capacity in the sector.

The market, however, is challenging for LMVBs and there has been a significant decline in their number in the sector over the past 30 years. They face a range of issues from accessing land, to attracting investment. Our £2 billion Levelling Up and Home Building Fund is designed to help LMVBs who are struggling to access finance through traditional lending routes. In December 2023 we launched a marketing campaign ‘We fund it. You build it’, to build momentum to unlock and accelerate housing delivery. We also established a new pricing matrix to tackle the impact of high interest rates on regeneration scheme viability.

Our innovative approach to LMVBs is increasing capacity to deliver homes. Kingswood Homes, operating in the north-west and south-west of England, received an innovative new multi-site loan facility to fund housing development, including site acquisitions. With our support, Kingswood has grown from building 36 homes per year in 2016, to over 100 homes. It is anticipated that, with continued support, they will double delivery to 200 homes per annum within the next 3 to 4 years.

Paul Jones, managing director of Kingswood said: “Kingswood has proven that with appropriate financial support, small house builders can grow into medium sized businesses and play a role in helping to address the sustainable quality housing requirements set by government. 

“Homes England has been brilliant in understanding the financial support that we needed in order to deliver that growth and enable Kingswood to potentially access corporate finance in future years.”

In the last 5 years, we have supported more than 200 LMVBs to grow their business and nearly one fifth of our housing completions are now being delivered by smaller builders. In 2023 and 2024 alone we targeted £400 million of funding to LMVBs to increase sector capacity and capability, and to overcome barriers to entry in the housing market. In February 2024, it was also announced that a pipeline of future small sites will be developed for LMVBs by parcelling suitable Homes England land. This will increase access to land for small developers, with pilots expected to begin in 2024 and 2025 in the South East and Midlands.

KPI 9 — Share of supported completions by low and medium volume builders (LMVBs)

Purpose — To measure the share of homes delivered through contracted schemes in the current financial year, where we contract directly with LMVBs. A LMVB is a developer who delivers fewer than 2,000 homes per year and is not a subsidiary of a parent company delivering more than 2,000 units per year.

Measure — 19% of homes in 2023 and 2024 were delivered by LMVBs, where we contracted directly with the LMVB.

Working with private sector investors

Alongside our traditional loan and grant interventions, we work in partnership with the public and private sector to provide innovative investment solutions to support housebuilding. We are involved in joint ventures, development agreements and other forms of collaboration to leverage both public and private resources and expertise. We also provide institutional investors with access to a wide range of equity investment opportunities to leverage private sector capital into the residential market.

In January 2024, we extended our investment in ECF (formerly English Cities Fund) by injecting an additional £50 million, elevating the fund to £200 million in equity. This injection of funding will be matched with additional commercial lending to fund transformative regeneration schemes in areas that need it most. Existing place-based partnerships cover Salford, Canning Town, Stockport and St Helens, Merseyside. By 2036, ECF is expected to deliver 17,000 new homes, more than 1 million square feet of commercial space, and additional social infrastructure to support education, health and wellbeing.

Our commitment to the Community Housing Fund provides confidence to new investors to enter the affordable housing sector. The fund’s core aim is to accelerate the delivery of new affordable homes in high-demand and low-availability areas of England. The fund will deliver 1,300 homes. In addition, the highly successful Housing Growth Partnership (HGP), a ground-breaking collaboration with Lloyds Banking Group, continues to provide much needed equity finance to LMVBs. Our renewed commitment to the HGP supports the development of a more resilient housebuilding sector by providing LMVBs with access to debt funding to support housing delivery. Overall, HGP is expected to deliver over 8,000 homes.

Increasing productivity

We also support the market to innovate in how it delivers new homes and enhances productivity. Initiatives include greater adoption of Modern Methods of Construction (MMC). We continue to develop a growing evidence base for MMC and the opportunity it provides to create further housing delivery capacity. A factory-based offsite approach to construction also provides a permanent place of work, which enables a more diverse range of people and skills to participate in housing production and delivery. Among the most frequently cited reasons for adopting MMC are speed of delivery, improved energy performance and lower embodied carbon. We encourage the delivery of these important benefits through our MMC support in our Land, Investment and Grant programmes. We are also working on a multi-year research project with Atkins, University College London and the Building Research Establishment to evidence the impact of MMC deployment within the housing sector across 6 pilot sites. Evidencing the benefits of MMC use should provide greater confidence to the industry, investors, insurers and customers to support its use across the sector.

Enabling regeneration at scale and pace

New housing starts during 2023 and 2024 were impacted by elongated timescales associated with obtaining outline and full planning permissions. Ability to deliver at pace was also hampered by requirements on nutrient neutrality, biodiversity, environmental and natural habitat. As a result, we initiated activity to bring together the skills of the Agency to help support local leaders address the capacity and capability challenges faced in unlocking major developments.

We also continue to play a key role in enabling the sector to deliver new housing at scale, as one of a few organisations with the skills, expertise and resource to take on the role of master developer. The PBR affirms this key role, and highlights the opportunity to do more to lead and stimulate regeneration, embed design quality and bring in stakeholders at the right stage of the project lifecycle. This is demonstrated by our role in delivering Northstowe in Cambridgeshire. We act as master developer of Phases 2, 3A and 3B, which make up 85% of the town. In an area of high demand for housing we have planning permission for 8,500 homes, with 40 to 50% affordable housing and re-use of over 330 hectares of brownfield land.

Expanding our interventions

We worked closely with MHCLG through the year to develop a series of interventions to enable further support of the housing market. This included an expansion to MHCLG’s Affordable Homes Guarantee Scheme, which enables housing providers to secure low-cost loans. The affordable housing sector has always had to balance the investment it makes in existing homes with the investment it makes in building new homes.

Over the past year, increasing financial pressures made achieving that balance even more difficult, with housing associations pausing or slowing their developments. Funding can now be used to support the delivery of replacement homes, where they are being delivered alongside new affordable homes, and help regenerate and improve existing social housing estates. This change is something the sector has been calling for, and with it there is a real opportunity to accelerate the regeneration of social housing with a larger number of new, high-quality, energy efficient affordable homes. The existing facility has been increased by £3 billion, intended to support the building of an additional 20,000 new affordable homes.

Overall, we have delegated responsibility for the due diligence and oversight of £6.5 billion of housing guarantees which MHCLG provides to Registered Providers of social housing.

Delivering on our strategy: high-quality homes in well-designed places

We are committed to promoting the creation of high-quality homes in well-designed places that reflect community priorities. In line with our design assessment tool ‘Building for a Healthy Life’ (BHL) and national and local design codes, we are taking an inclusive and long-term approach to enable:

• more integrated neighbourhoods with access to nature and amenities facilitated by walking, cycling and public transport
• distinctive places that reflect local character
• streets, public space, and blue and green infrastructure that are designed for people to use, easy to navigate and have a well-considered relationship between public and private spaces

Design quality

We have continued to work with partners to embed design quality across housing interventions, be it through our master planning role, large scale catalytic urban regeneration or our work with LMVBs. Our key measure of design quality is based on the principles of BHL, a toolkit produced by Design for Homes in partnership with the NHS and input from Homes England and the Ministry of Housing, Communities and Local Government (now known as MHCLG). BHL assessment helps those involved in new developments to think about the qualities of successful places and how these can be best applied to the individual characteristics of a site.

Working closely with BHL principles proved successful in gaining outline planning permission for a previously stalled site at Hurst Farm, Haywards Heath. The reconsidered and improved site design was worked through with the community and local authorities to understand their aspirations for the site. It will provide up to 375 homes, a primary school, cemetery and accessible green spaces.

KPI 12 — Share of supported schemes that meet or exceed the agreed standards for design quality (in line with BHL)

Purpose — To ensure that our sites deliver positive design outcomes for building and places, from acquisition through to delivery.

Measure — The percentage of schemes that have met or exceeded the pre-disposal assessment BHL score at ‘reserved matters’^{[footnote 2]}. 88% of our supported schemes meet or exceed the agreed standards for design quality.

Building safety

Ensuring people feel safe and secure in the homes they live in is fundamental to their health and well-being. Following the Grenfell disaster, commitment was made to ensuring that all buildings built using unsafe aluminium composite material (ACM) and other forms of unsafe cladding were remediated on tall residential buildings.

We act as delivery partner on the Building Safety Fund (BSF) and Private Sector Cladding Remediation Fund (PSCRF) providing nonrecoverable grants to owners of buildings outside London of over 18 metres in height to replace unsafe cladding systems. The PSCRF is in its final phase and the remediation work under the BSF has since started with work completed on 65 buildings up to the end of 2023 and 2024.

A leaseholder, commenting on the Building Safety Fund, said: “Since Grenfell happened and we found out about the issues here, we have been living on tenterhooks. The fact that this is now in the past still feels a bit unreal. This weight that has been on us all for so long is suddenly not there anymore and it’s a great feeling.

“Without the guys here on site , and without the Building Safety Fund and the people we don’t see, this wouldn’t have been possible. I think the phrase ‘life changing’ is overused but in this case it actually is. And not just for me and my family but for an entire block of families. It’s amazing, thank you.”

Table: Building Safety Fund lifetime targets

Business case	Achieved to date	Forecast
443 BSF applications under management	319	319
£1 billion value of BSF approvals by April 2024	£1.16 billion	£2.2 billion (all applications under management approved)
75% of the PSCRF projects complete by April 2024	76%	78%

The forecast for 443 BSF applications under management has been revised down from over 400 to 319 due to withdrawn applications and 103 buildings transferred to the original developer under the Responsible Actors Scheme (RAS). New buildings of 18 metres or over will apply to the Cladding Safety Scheme (CSS).

The CSS was was formally launched in July 2023 following a pilot scheme and makes up part of the wider Building Remediation Portfolio led by our sponsor department, MHCLG. The scheme has been formally delegated to Homes England for delivery and is designed to meet the cost of addressing life safety fire risks associated with cladding on residential buildings over 11 metres in height (11 to 18 metres in London, with the Greater London Authority continuing to operate the Building Safety Fund for buildings over 18 metres in Greater London).

During 2023 and 2024 we built up the prospects for future year delivery, making 170 buildings eligible and progressing 148 of these to have signed grant funding agreements. We provided over 100 eligible applicants with pre-tender support payments to enable the set-up of project teams to work with the market to assemble packages of work to make buildings safe, progressing 2 to start on site.

We continue to build up the prospects for future years and expect to see our first completion in the second quarter of 2024. By the end of March 2024, over 35,000 residents and leaseholders had started to see progress with their buildings, across the known 6,000 buildings being investigated across the various stages of the programme.

A leaseholder, expressing thanks, said in a message to our CEO: “I am a leaseholder who has lived under the threat of having to pay for cladding at my flat in the sum of £50,000 to £70,000 since the fire regulations changed following the Grenfell disaster. I am a pensioner, and having to pay this amount of money from my private pension, set up to pay my service charges, would have decimated my financial future.

“I could not be more grateful that the [Cladding Safety Scheme] Fund has approved our application and that I no longer have to face this financial burden. You might not get to meet recipients of your funding, but please let me assure you that we could not be more grateful.”

Table: Cladding Safety Scheme lifetime targets

	Business case	Achieved to date	Forecast
Completions	4,936	As detailed	4,936
Expenditure	£3.9 billion	£28.25 million	£4.1 billion

Delivering on our strategy: sustainable homes and places

In recent years, housing and planning policy has evolved to increasingly emphasise the importance of mitigating climate change, addressing biodiversity decline, improving health and wellbeing and ensuring high standards of sustainability and design quality are delivered in homes and places.

Through enabling sustainable homes and places we are looking to facilitate:

• more energy efficient, carbon efficient and resource efficient homes and places, both in-use and across their whole life
• places that enhance the natural environment, including air and water quality and biodiversity

Sustainable homes

Encouraging our partners to improve on the energy efficiency of new homes will result in lower emissions and contribute to ensuring higher standards of sustainability and design quality. Energy performance is also an important factor for home occupiers as there is a direct correlation to their energy bills. In 2023 and 2024, 87% of homes completions supported by Homes England met EPC rating B or above.

To provide confidence to developers and lenders to do more to improve environmental standards and to get ahead in building more sustainably, we are partnered with Octopus Real Estate on the Greener Homes Alliance. This gives housebuilders both the funding and the knowledge needed to build more high quality, energy efficient homes throughout England. Homes funded must achieve a minimum EPC rating of B and will benefit the housebuilder with interest rate discounts when meeting EPC ratings.

KPI 13 — Building Performance — share of supported completions that are EPC rating B or above.

Purpose — To understand the estimated operational carbon efficiency of those home completions supported by Homes England.

Measure — 87% of our supported completions have an EPC rating of B or above.

In February 2024, biodiversity net gain (BNG) became a legal requirement for new planning applications made in England. BNG is an approach that requires development to have a positive impact on biodiversity. This ‘net gain’ is achieved when developers create new habitats or retain and enhance existing ones on the development site. This year we focused on the introduction of a 10% BNG target for all our sites. Going forward, we will consider introducing a higher BNG target on sites where it will be viable and feasible to do so.

Schemes such as Northern Arc in mid Sussex will deliver significant improvements in biodiversity. Situated north of Burgess Hill, this scheme is a 200 hectare, 3,500 home development being delivered by Homes England in our role as master developer. It is set within a mature landscape of habitats including ancient woodland, mature trees, species-rich hedgerows, semi-improved grassland, watercourses and ponds. As master developer, the Agency is responsible for the long-term stewardship of the area, and careful consideration was given to the 2 kilometre stretch of the River Adur on the site. Habitat will be protected and enhanced through new planting and river improvements, as part of our plans to achieve a biodiversity net gain on site of up to 23%.

During 2023 and 2024, our aims on sustainability were supported by the development of our Living Sustainably statement of intent. We also worked on the development of a Sustainability and Design Passport, a Nature Positive Plan, and a carbon inventory. Further information is available in our Sustainability Report.

Corporate health: achieving our plan

We enable delivery of our strategic objectives through initiatives that seek to ensure we are a high performing organisation with effective and efficient processes, governance and risk management, and colleagues who feel supported in their work.

We aim to deliver an Agency that:

• works for its partners
• reflects the communities it serves
• effectively manages risk

Working with our partners to achieve our objectives

Our 2023 Partner Perception Survey shows that 68% of our partners are satisfied with the support provided by Homes England, with an additional 23% neutral. Partner feedback acknowledges we add value through investment, funding, advice, support and capacity. Partners also recognise our role as an enabler and facilitator, with increasing acknowledgment of our role in regeneration and place.

In September 2023, we launched our new Customer Relationship Management (CRM) system to capture interactions, relationships and engagement with our external partners. This tool provides a single source of partner data, facilitating coordinated engagement and data-led decision making. In its first 7 months of operation, the system captured over 4,000 interactions, of which 105 related to new opportunities.

KPI 16 — Share of partners reporting overall satisfaction with Homes England

Purpose — To measure how satisfied our partners are with Homes England based on their understanding of our role and remit, and to provide an indication as to whether we are functioning effectively and enabling positive engagements with our partners. A partner is any housing developer, local authority or other organisation who has transacted with us in the past 3 years.

Measure — 91% of our partners reported they were either satisfied or neutral with Homes England. 68% of all our partners scored us 6 out of 10 or above in overall satisfaction.

Building a brilliant place to work

During the year we furthered our change programmes to modernise the way we work, to ensure we have the right organisational design to deliver our strategy and to create the right environment for colleagues to thrive. We wrapped these change programmes up under a banner called Building a Brilliant Place to Work, telling the story of how our transformation projects will enable us to create a better, more effective and efficient work environment for our people.

In December 2023, we launched our annual employee engagement survey. 7 out of 10 colleagues responded positively to the question on whether they feel able to bring their whole self to work. This score is in line with our plans to improve employee engagement.

We are working to make Homes England a place where everyone can find the opportunity to succeed. We are integrating diversity and inclusion into everything we do to lead by example and to excel in fulfilling our obligations under the Public Sector Equality Duty. Further information on Equality, Diversity and Inclusion (EDI) is available in section 3.2, Remuneration and staff report.

KPI 17 — Average colleague rating for Homes England being a diverse and inclusive employer

Purpose — To demonstrate whether Homes England colleagues feel we are an inclusive employer and whether we foster a positive working environment and experience.

Method — Our colleagues rated Homes England 7.2 out of 10.

Managing risk

We employ a rigorous Risk Management Framework to address risks that may impede the achievement of our strategic objectives. These principal risks are identified and managed through top-down and bottom-up processes, with focus on proactively identifying and mitigating key vulnerabilities and operational risks that could disrupt strategic progress.

At the end of 2023 and 2024 there were 4 principal risks outside of risk appetite. These risks encompassed change management, capacity and capability, funding alignment, and business continuity. Further information is available in the Principal risks section.

KPI 18 — Number of principal risks outside risk appetite.

Purpose — To identify and monitor all principal risks outside the appetite agreed upon and set by our Board which could materially impact the successful delivery of our strategic objectives.

Method — There were 4 principal risks outside appetite at the end of 2023 and 2024.

Quarter	Number of principal risks outside appetite
Quarter 1	2
Quarter 2	2
Quarter 3	2
Quarter 4	4

Principal risks

‘Principal risks’ are those risks that are so significant that they could materially impact the achievement of our strategic objectives.

The Executive Leadership Team (ELT) owns and is collectively responsible for the identification and management of principal risks relevant to the organisation at any given time. Homes England’s Board continuously assesses the nature and extent of the principal risks that the organisation is exposed to and is willing to take, in order to achieve its objectives.

Our principal risks are:

1 Macroeconomic conditions — Risk that the Agency has not monitored or is insufficiently prepared and empowered to respond to changing macroeconomic conditions, which affects our ability to achieve strategic objectives, recovery expectations and to prevent customer detriment.

Current position — This risk is within appetite due to the general signs of improvement in the economic environment and the various re-sets which have taken place in our commissioned programmes thereby improving our ability to react to changes in the marketplace.

2 Delivery partners — Risk that our delivery partners (such as private sector, Local Authorities and Housing Associations) do not have the capacity, capability or willingness to work with us, delaying or preventing delivery of housing and regeneration initiatives.

Current position — This risk is within appetite and is overseen and mitigated through delivery performance reporting and partner level engagement and intelligence. An important aspect of supporting the capacity and capability of our public sector partners is through Agency provision of capacity and support.

3 Change management — Risk that the Agency does not effectively deliver or absorb the change agenda, leading to a reduction in efficiency and effectiveness and impacting our ability to deliver.

Current position — Change management risk remains above risk appetite, but Phase 1 of the change management roadmap has been implemented leading to a reduced overall risk score. An Enterprise Project Management Office has been established to provide direction and prioritise change initiatives, including improved governance framework with clear roles and responsibilities. To bring this risk within appetite, work is ongoing to embed business change capability within change delivery and to strengthen existing controls.

4 Business continuity — Risk regarding capability of the Agency to continue operating and delivering services and products at acceptable predefined levels during a disruptive incident. The capability and capacity to restore operations to normalised levels within acceptable timeframes.

Current position — This risk is out of appetite, but we expect this to be mitigated by quarter 2, 2024 and 2025. We have improved our response protocols, including the Business Impact Analyses, and prioritised critical functions to provide a solid base for improved resilience. Planned risk control improvement actions include prioritising process and system criticality and regular testing of plans to mitigate this risk.

5 Capacity and capability — As the ambition for the Agency continues to grow and evolve, there is a risk that we will not be able to deploy, grow our own or recruit people with the right skills to meet this challenge quickly enough.

Current position — While this risk remains above our risk appetite, significant progress has been made throughout the year to deliver improvements such as embedding strategic workforce planning and increased recruitment activity which has addressed gaps. Looking ahead, we are committed to further mitigating this risk and our focus remains on executing the delivery plan, including a comprehensive skills analysis which focuses on ensuring we have the right size teams with the right skills in the right places. We will continue to ensure strategic workforce planning remains embedded in all recruitment decisions so we can build a future-proof workforce aligned with our strategic objectives.

6 Funding — Risk of misalignment between the Agency’s Capital, Resource and Administration budgets, and government policy objectives.

Current position — Significant progress has been made in how 2024 and 2025 budget negotiations with MHCLG were conducted during Q4 2023 and 2024 to drive greater alignment between different budget types and between financial inputs and delivery outputs.

At 31 March 2024 a delegation letter to formally agree budgets had not been received and so the risk remained out of appetite at the end of Q4 2023 and 2024, with the Agency operating to an indicative budget delegation for the first quarter of 2024 and 2025.

Receipt of a formal budget delegation letter from MHCLG is expected imminently and will bring this risk back into appetite.

7 Value for Money (VfM) — Risk that we are unable to demonstrate value for money on public resources invested by the Agency.

Current position — This risk is within appetite. VfM risk is being actively mitigated through actions including assessing programme effectiveness through programme evaluations and VfM assessments for high-value projects, utilising the robust 5-case business model framework.

8 Cyber resilience — Breach of security to gain access to information for the purpose of espionage, extortion or embarrassment.

Current position — This risk is within appetite. The Homes England Cyber Security team leverages a 24 hours a day, 7 days a week Security Operations Centre and recently passed an ISO 27001 audit with no major non-conformities. Due to the dynamic nature of cyber threats, the risk can quickly move outside appetite. Proactive threat monitoring, effective reporting, and strong oversight are crucial for swift responses to heightened cyber threats. We continue to improve security controls and awareness to maintain a strong cyber defence position.

Market context

Impact of macroeconomic uncertainty

Homes England produces a range of economic forecasts to help manage financial risk. The forecasts are based on a combination of scenarios from the Office for Budget Responsibility (OBR) and Oxford Economics (OE), a global independent forecasting organisation.

The scenarios account for the key macroeconomic risks and uncertainty facing the Agency. The OE scenarios encompass:

• a central scenario, which assumes the economy will gradually gather momentum during the year April 2024 to March 2025, growing 1% in total. Inflation falls quickly below its 2% target allowing interest rates to be cut by a full percentage point. The labour market remains robust. Housing market transactions are forecast to increase by 15% in the year — albeit from a low base as lower mortgage rates encourage more demand. Annual house price growth for the full year is forecast at -0.6%. Housing starts are not expected to pick up in the next year given the weak economic and housing demand backdrop.
• an upside scenario, which assumes inflation continues to fall and policy rates are cut sharply as a result. Lower rates stimulate business and investor confidence, helping to drive economic growth up to 1.5%. Housing market activity improves slowly as the market adjusts to lower interest rates, but affordability remains stretched, limiting the pace of house price growth. Under this scenario, house prices are 0.4% lower than the previous year. New housing starts are also expected to take time to adjust to lower rates leaving volumes at a modest 170k.
• a downside scenario where there is a spike in oil prices. The economy remains in recession, while inflation increases, and interest rates rise at the same time. Stock markets fall and confidence evaporates, and the economy shrinks in 2024. Unemployment rises in the short term. This has a larger impact on housing market activity and house prices. Under this scenario, house prices fall 1.1% in the year.

These scenarios are applied by Homes England to its portfolio of assets, to assess the financial implications on the portfolio and for the delivery of Homes England’s objectives.

The valuation of the Agency’s assets may be estimated with reference to key market indicators, such as house price growth, economic growth and unemployment. This is the case for financial assets measured at fair value and land and property assets. Similarly, expected credit loss forward looking models for assets held at amortised cost are calculated with reference to these same economic metrics.

Impact on Help to Buy portfolio

The Help to Buy portfolio is particularly sensitive to market risk from changing house prices. Decreases in house price lead directly to a reduction in the market valuation of the Agency’s home equity loan portfolio. Large falls in house prices could lead to a disproportionately large reduction in the market value due to Homes England’s equity ranking behind the mortgage from the primary lender.

Regional and property type concentration exists within the home equity loan portfolio, and divergences in house price between regions are a source of additional market risk (for example, an adjustment to the prices of London flats).

A fall in house prices may also lead to a reduction in the ability for customers to re-mortgage or to redeem their equity loan share, either due to being constrained by loan to value requirements or the removal of products from the marketplace. This would lead to a slowing in the redemption rate on the equity loan portfolio which, in turn, would result in a higher yearly interest fee income return on the portfolio and interest fee income being generated over a longer time period.

As movements in house prices are directly related to the market value of the Agency’s home equity loan, a fall in house prices may result in an increase in customers redeeming to crystallise the lower equity value. However, refinancing options in the market place are likely to be limited in this scenario, reducing customers’ ability to exit.

The Agency performs a market risk analysis (note 14a) which considers how the valuation of this portfolio would change with movements in house prices and a further sensitivity analysis (note 15) which looks at the key modelling assumptions and illustrates the effect of varying them.

Impact on recoverable investment portfolio

For the recoverable investment portfolio, comprising loans, debt and equity, the main type of security held is land. Falling land values would therefore result in increasing Expected Credit Loss (ECL) estimates on loans held at amortised cost, although the effect on the ECL would not be material due to the Loss Floor of 35% being applied to the calculation at 31 March 2024. If land prices were to decrease by 10%, it is estimated that this would result in an increase in the ECL of £4.9 million (see note 15b). Falling house prices, particularly if combined with increasing developer costs, would result in loans becoming less viable, leading to an increased risk of default. This may in turn lead to a further increase in the ECL estimate for loans held at amortised cost.

Falling house prices would likely be combined with falling demand for housing, resulting in delays to delivery on the recoverable investment portfolio, and could impact project viability if sales cannot be recycled into the funding required to maintain project development.

Potential impact on asset valuations from alternative economic scenarios

To aid users of the accounts in understanding the potential risks posed by future macroeconomic uncertainty to the assets managed by the Agency, we have used the scenarios developed by the OBR and OE to estimate the impact on the Agency’s key asset classes. By applying relevant metrics from these scenarios, we can model the potential impact of ongoing market uncertainty on assets disclosed in the 2023 and 2024 Financial Statements.

Home equity loans (including Help to Buy)

For home equity loans, the principal driver influencing changes to the valuation of assets are house prices. To demonstrate the potential impact on the portfolio of house price changes, the forecast house price movements used to inform the Agency’s downside economic scenario have been applied to the valuation. These forecasts predict a low point in house prices in quarter 1 of 2025 and 2026, with the movement in house prices forecast to reduce by 1.4% from the reporting date to the lowest point. For the portfolio that exists at 31 March 2024, the estimated effect would be a reduction in the valuation of the portfolio from £17.6 billion to £17.2 billion, a reduction of £0.4 billion.

Loans

For loans measured at amortised cost, the ECL reflects a weighted average of the outcomes which might be expected under each of the 3 scenarios. To model the effect of each scenario individually, we have considered the outputs from each individual scenario ECL calculation.

In addition, we have considered whether the credit risk stages of assets (based on an assessment of Significant Increase in Credit Risk (SICR)) might change under each scenario.

We have modelled the impact under each scenario if all assets were moved to stage 2 (indicating a significant increase in credit risk for all assets), with the modelling for the downside scenario producing an increased ECL of £128.4 million under these assumptions.

	ECL as applied in the Financial Statements	ECL if SICR stages are adjusted to stage 2 for 100% of portfolio
Upside scenario	£56.8 million	£71.5 million
Central scenario	£86.4 million	£106.7 million
Downside scenario	£99.5 million	£128.4 million

For loans measured at fair value through profit or loss (FVTPL), the fundamental contractual nature of these loans and primary exposure to variation in returns is comparable with loans measured at amortised cost. As a result, the ECL percentages estimated for the loans measured at amortised cost are considered to be a suitable measure to estimate loss allowances on loans measured at FVTPL. The valuation of loans measured at FVTPL was £318.4 million at 31 March 2024.

	Estimated ECL on loans measured at FVTPL using ECL percentages applied to loans measured at amortised cost	Estimated ECL on loans measured at FVTPL using ECL percentages applied to loans at amortised cost, assuming all assets move to Stage 2
Upside scenario	£14.4 million	£18.1 million
Central scenario	£21.8 million	£27 million
Downside scenario	£25.1 million	£32.5 million

Land

The carrying value of the Agency’s land and property portfolio at 31 March 2024 is £1,065 million (net realisable value £1,448 million). Subjecting this value to metrics for upside, central and downside scenarios, shows the land and property portfolio at 31 March 2025:

	Estimated value at 31 March 2025	Base value at 31 March 2024	Increase or reduction since 31 March 2024
Upside scenario	£1,072 million	£1,065 million	+£7 million
Central scenario	£1,068 million	£1,065 million	+£3 million
Downside scenario	£1,060 million	£1,065 million	-£5 million

Over the next 12 months, the lowest point in each of the 3 scenarios occurs in quarter 3, 2024 and 2025 in the downside scenario. In this scenario, the land and property portfolio would be valued at £1,057 million, a decrease of £8 million from the 31 March 2024 figure.

Further analysis of the sensitivity of significant valuation modelling assumptions, which include more severe scenarios, has been carried out in note 14 of the Financial Statements. Given current macroeconomic uncertainties, it is possible that key contributing economic factors could have a greater impact than the scenarios presented.

Future impact of macroeconomic uncertainty

We monitor and manage the financial risk and KPIs of our delivery on a portfolio basis. The risk profile and uncertainty attached with specific projects is viewed across the portfolio, enabling us to effectively manage risk and uncertainty.

Delivery of our performance is secured through external partners, who independently manage their own risk and uncertainty. Partner delivery is a key factor that can impact our performance and requires the Agency’s proactive portfolio management.

The Agency operates early warning and watch systems for our lending facilities. These provide alerts where individual transactions are showing signs of increased pressure or deviating from our expectations. These systems also provide an overview that allows active management where the economy is showing signs of additional strain, or where there are other systemic issues that can affect delivery, cashflow or repayment.

We regularly review our processes and resources to ensure they are adequate to manage emerging risks to our investments in a downturn, should one occur. We continue to work closely with MHCLG and other stakeholders to gather and share market intelligence to understand the emerging challenges the sector faces and respond appropriately.

Countering economic crime

Homes England is committed to the effective management and application of public funds, setting high ethical standards while achieving value for money. Our Anti-Economic Crime (AEC) framework and 7 associated internal policies (including anti-money laundering, modern slavery, counter fraud, and financial and trade sanctions) are reviewed annually and updated accordingly.

Our 5-year counter-fraud and anti-bribery and corruption strategy continues to be delivered by our AEC team. We continuously examine our existing internal fraud control environment to improve it wherever necessary.

Cases of suspected fraud are assessed and, where the allegations have grounds for further review, they are investigated and actioned accordingly, with case progression and disposal monitored closely. Reporting of fraud continues to be a centralised electronic function managed by the AEC team. This ensures that all cases reported to AEC can be analysed, managed and, where necessary, investigated.

Additionally, and as part of our reporting function, all cases of confirmed fraud, error or loss are escalated and reported quarterly to MHCLG, the Cabinet Office and the Public Sector Fraud Authority.

Whilst we continue with our business function interactions, the emphasis between the business and the AEC team is the risk assessment and control mitigation of new programmes, through the money laundering related New Programme Risk Assessment (NPRA), incorporating the externally mandated Fraud Risk Assessment (FRA). This ensures that new (or enhanced) programmes, products or IT systems are reviewed at their inception and design state to identify, mitigate, and propose treatment strategies for AEC type risks. Our approach enables us to further understand and monitor the AEC risk landscape in relation to internal and external threats and the effectiveness and adequacy of our fraud prevention controls.

Where NPRAs and, or, FRAs have been facilitated, the identified risks are incorporated into the Automated Risk Management System (ARMS) operational risk management system, to manage the AEC risk on an ongoing basis. This continues to enhance and inform our rolling programme of improvements, including mandatory AEC awareness training for all staff and the implementation and use of our e-learning platforms which help us measure the effectiveness of our compliance training.

As part of our commitment to achieving greater social value benefits, we seek to identify and eradicate modern slavery across all our business activities and in our supply chains. In 2023 and 2024, we reviewed our modern slavery policies to reflect the changing environment.

We work with the Gangmasters and Labour Abuse Authority (GLAA), and are proud to hold the status of an approved partner. The Agency, together with construction industry partners, have signed the GLAA intelligence-sharing protocol and we maintain relationships with United Kingdom (UK) law enforcement bodies. We continue to work with the Office of the Independent Anti-Slavery Commissioner and the GLAA, utilising their monthly intelligence reports to benchmark our risk approach.

We have delivered external training to panel surveyor firms and procurement framework service provider partners, so we can instil the need for compliance with our policies. We require our partners to identify and report suspicious activity and welfare concerns.

We continue to prepare and deliver internal training to Homes England staff in the form of presentations and workshops in relation to identifying modern slavery risks. We have also developed our proactive reassurance plan to deliver inspection activities in conjunction with our monitoring surveyors at our high-risk sites throughout the UK.

To enhance staff knowledge and awareness of new legislation and its applicability to the Agency, we have recently purchased 3 courses for counter tax evasion, corporate criminal offence and the new corporate offence of failure to prevent fraud.

We continue to monitor the UK sanctions regime against our consumer and development partners. We do this by ensuring that internal and external due diligence providers meet the UK’s financial sanctions regime requirements, to ensure we are not doing business with any person or organisation subject to financial sanctions.

Financial review

For the financial year 2023 and 2024, Homes England’s performance against its budgetary control totals is summarised below:

Table: Capital Financial Transactions ^{[footnote 3]}

	Outturn	Budget (Main)	Budget (Supplementary)	Variance (Supplementary to Outturn)
Expenditure	£413.3 million	£587.1 million	£466.2 million	(£52.9 million)
Receipts	(£581.9 million)	(£461.3 million)	(£608.8 million)	£26.9 million
Net Capital Financial Transactions	(£168.6 million)	£125.8 million	(£142.6 million)	£26 million

Table: Capital non-Financial Transactions

	Outturn	Budget (Main)	Budget (Supplementary)	Variance (Supplementary to Outturn)
Expenditure	£2,753.7 million	£2,681.8 million	£2,764.8 million	(11.1 million)
Receipts	(£83.6 million)	(£110.4 million)	(£93.9 million)	£10.3 million
Net Capital non-Financial Transactions	£2,670.1 million	£2,571.4 million	£2,670.9 million	(£0.8 million)

Table: Resource — Expenditure ^{[footnote 4]}

	Outturn	Budget (Main)	Budget (Supplementary)	Variance (Supplementary to Outturn)
Administration	£122.2 million	£116.1 million	£122.3 million	(£0.1 million)
Programme Resource	£95.7 million	£116.7 million	£99 million	(£3.3 million)

Table: Resource — Receipts

	Outturn	Budget (Main)	Budget (Supplementary)	Variance (Supplementary to Outturn)
Administration	(£232.6 million)	(£72 million)	(£72 million)	(£160.6 million)
Programme Resource	(£64.2 million)	(£59.9 million)	(£50.2 million)	(£14 million)

Table: Net Resource

	Outturn	Budget (Main)	Budget (Supplementary)	Variance (Supplementary to Outturn)
Net Resource	(£78.9 million)	£100.9 million	£99.1 million	(£178 million)

Table: Total — expenditure and receipts

	Outturn	Budget (Main)	Budget (Supplementary)	Variance (Supplementary to Outturn)
Expenditure	£3,384.9 million	£3,501.7 million	£3,452.3 million	(£67.4 million)
Receipts	(£962.3 million)	(£703.6 million)	(£824.9 million)	(£137.4 million)
Net Total	£2,422.6 million	£2,798.1 million	£2,627.4 million	(£204.8 million)

Financial performance in 2023 and 2024

The Agency agrees its annual budgets with the Ministry of Housing, Communities and Local Government (MHCLG) and HM Treasury at the start of each financial year through the Main Estimates process. Budgets are illustrated gross, showing both expenditure and receipts, but are delegated and managed on a net basis. Any subsequent refinements or changes are made through the Supplementary Estimates process mid-way through the financial year.

Budgets submitted to MHCLG are accompanied by ranges to capture delivery volatility caused by project specific issues and, or, by market, or wider economic conditions. Several of the Agency’s key programmes generate income as well as incur expenditure. As a result, MHCLG delegates budgets to the Agency on a net expenditure basis.

Programme budgets for 2023 and 2024 were refreshed through the Supplementary Estimates process. MHCLG confirmed the revised budgets in the final quarter of the financial year and formally delegated the revised budgets in April 2024.

Although the Agency was able to update its spend and income budgets at the Supplementary Estimate (based on revised forecasts) it was not able to adjust the corresponding Key Performance Indicators (KPIs). As a result, performance against the KPIs is reported against the unadjusted start of year Annual Business Plan figures.

The Agency is delegated separate budgets for programmes and administrative costs. Within both programme and administrative budgets, funding is classified as either Capital (CDEL) or Resource (RDEL). Capital budgets are split into 2 further categories, CDEL Financial Transactions (CDEL-FT) which covers loans and equity and CDEL non-Financial Transactions (CDEL non-FT) which covers grants and investment in Land activities.

In 2023 and 2024 there was a significant decrease in CDEL-FT budgets delegated to Homes England due to the closure of the Help to Buy scheme. However, there was an increase in CDEL non-FT budgets delegated to the Agency to support increased expenditure for Affordable Housing and Infrastructure Grants. RDEL refers to the expenditure incurred during day-to-day business activities. Against revised supplementary estimate budgets, the Agency successfully deployed 98% (£3.4 billion) of its total delegated expenditure budget. Alongside this the Agency generated 116% (£1.0 billion) of its total income budget. A breakdown by programme is as follows:

Chart: % gross expenditure target achieved

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Chart: % gross income target achieved

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Administration income relates to interest from Agency loans and is used to support operating costs incurred in the day-to-day running of Homes England. The Agency is only able to retain a maximum of £72 million of this income with any surplus returned to central government to support wider government expenditure. In 2023 and 2024 the Agency generated £232.6 million in administration income, considerably more than £72 million it was allowed to retain.

Most programmes performed well against budgets with the exception of the Brownfield Land and Infrastructure Fund. This was a result of delays in securing the necessary approvals for several outside-delegation projects. These projects have moved into the 2024 and 2025 financial year and no delivery has been lost.

Over £2 billion of Affordable Home grants were awarded in 2023 and 2024, deploying 99.6% of the delegated budget for this programme.

The Cladding Safety Scheme (CSS) was formally launched in July 2023 following a pilot scheme, deploying 100% of its CDEL budget, supporting over 100 eligible applicants with pre-tender support.

The Development programme is managed on a net basis (gross expenditure less gross income) across all funding types including CDEL Non-FT, CDEL FT and RDEL. In 2023 and 2024, 98% (£178 million) of the total expenditure budget was deployed and 104% (£185.8 million) of the income budget secured.

Significant expenditure was made via Housing Infrastructure Grants during 2023 and 2024, with £471 million ^{[footnote 5]} deployed. Most of those grants (£456.5 million, 97%) were made through the Housing Infrastructure Fund. This programme was able to accelerate expenditure from future years to minimise Agency underspend, deploying £12.3 million more than its delegated budget.

The Agency’s Investments programme deployed 92% of its expenditure budget. Most of this underperformance was caused by slippage in Capital FT expenditure in the Home Building Fund - Long Term Fund, and Home Building Fund - Infrastructure Loans programme. This missed delivery has moved into 2024 and 2025. Income activity followed a similar pattern. 95% of the £568m income budget was secured with some short-term receipts (over which the Agency has no or limited control) moving into 2024 and 2025.

The Markets, People and Places directorate spent £15.9 million RDEL in 2023 and 2024 on project development activity. This work supports the development of a robust future pipeline for the Agency’s CDEL programmes. The investments have been focused on an agreed set of priority places to support government regeneration objectives.

Change of assets in 2023 and 2024

In 2023 and 2024 the Agency’s balance sheet reduced by around £1.7 billion (8%), from a peak of around £23 billion in 2023 and 2024 due largely to a £1.5 billion reduction in Help to Buy assets. This reduction reflects the closure of the programme and redemption of Help to Buy loans, as well as movements in fair value.

There was also a reduction in Financial Assets (at amortised cost) primarily due to repayment of loans and recognition of accounting write-offs.

	SoFP
2023	£22,702 million
2024	£20,934 million

	Change in net assets during 2023 and 2024
Help to Buy	-£1,493 million
Legacy home equity schemes	-£12 million
Other financial assets at fair value	-£22 million
Financial assets at amortised cost	-£231 million
Land	-£5 million
Other net assets	-£5 million

Future change of net assets

Chart: Projected change in net assets over time, based on the Agency’s Annual Business Plan

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Over the next 5 years the Agency’s net asset position is forecast to reduce further. This reduction reflects closure of the Help to Buy programme on 31 May 2023 and the gradual redemption of Help to Buy loans. However, excluding Help to Buy, the Agency’s balance sheet is expected to grow over the next 3 years, stabilising in 2027 and 2028 and reducing slightly in 2028 and 2029. The most significant investment impacting the balance sheet over the next 5 years is from the Home Building Fund Infrastructure Loans programme and the Brownfield Infrastructure and Land fund.

The Agency’s land assets are forecast to grow over the next 3 years, peaking in 2026 and 2027 at £1.7 billion (10% of net assets) but reducing in 2027 and 2028 and 2028 and 2029. This reflects reduced net expenditure on the Land Assembly programme.

The impact of investments on the balance sheet over the next 5 years is around £2.5 billion per annum, reflecting continued investment in programmes such as the Home Building Infrastructure Loans fund, the Levelling Up Home Building fund and the Brownfield, Infrastructure and Land fund.

Changes in the level of administration costs

The Agency was delegated an administration budget of £122.3 million in 2023 and 2024. This is £2.5 million less than was delegated in 2022 and 2023. The 2023 and 2024 settlement included £2.1 million to fund a non-consolidated payment for Agency staff below director level. The Agency deployed 99.6% of its administration budget settlement compared to 91% (£113.8 million) in 2022 and 2023.

In 2023 and 2024 the Agency continued to accelerate its programme of efficiencies with a view to reducing pressure on its administration budget. However, high inflationary pressures and the need to undertake targeted recruitment to enable the delivery of its strategic plan meant that necessary recruitment in other areas of the Agency was not undertaken. Further administration budget reductions are expected in 2024 and 2025, which will require careful management of resources and continuing delivery of efficiencies through both systems development and organisational design to maintain delivery.

Loan portfolio performance

Since 2012, the Agency has deployed nearly £5 billion of loans to support the unlocking and acceleration of housing projects across the country. The risk profile of such projects is, by definition, higher than average market risk, and HM Treasury-approved lending programmes assume average capital loss rates of 20%. The Agency-financed development projects will generate a 107% return on this strategy, being earnings of 13% balanced with cumulative capital losses on repaid loans and impairments to date on outstanding loans of 6% (less than 0.5% per annum since 2012). This compares favourably to private sector lending returns; it is materially better than the programme recovery rates and has unlocked over 176,000 homes. Indeed, the recent Public Bodies Review recommended that the Agency be authorised to take more risk in its loan deployment in order to deliver more impact.

For investment loans which were fully repaid as at 31 March 2024, of the £2.8 billion of funding provided, £3.1 billion has been recovered. Overall, there have been losses, including interest, of £26.3 million on these loans, which represents only 0.9% of the amount of funding provided. For investment loans which are still outstanding as at 31 March 2024, of the £2.1 billion of funding provided, £0.6 billion has been recovered cumulatively to 31 March 2024. It is expected that a further £1.5 billion will be recovered on outstanding exposures at 31 March 2024 (which excludes receipts from any future interest accruals after the reporting date).

Chart: Performance of investment loans fully repaid at the reporting date

	Amount
Drawn	£2,827.98 million
Interest earned	£256.66 million
Write-offs	-£26.30 million
Total recovered	£3,058.34 million

Chart: Investment loans outstanding at the reporting date

	Amount
Drawn	£2,027.94 million
Forecast interest earned	£386.54 million
Write-offs and impairments	-£264.40 million
Forecast total recovery	£2,150.08 million

Chart: Combined position for all loans, repaid and outstanding

	Amount
Drawn	£4,855.92 million
Forecast interest earned	£643.20 million
Write-offs and impairments	-£290.70 million
Forecast total recovery	£5,208.42 million

Operating expenditure

Operating expenditure totalled £3,256 million in 2023 and 2024, an increase of £838 million (35%) from 2022 and 2023. This is driven mainly by an increase in grants from £1,664 million in 2022 and 2023 to £2,595 million in 2023 and 2024. This increase is partially offset by a reduction in the cost of land and property disposals (£75 million in 2023 and 2024 compared to £183 million in 2022 and 2023).

The Agency’s land and property portfolio comprises many different assets with different features and values, spread across geographical locations. As a result, the type of property sold each year and the value realised, may fluctuate from one year to the next. There was also a reduction in decreases in fair value below initial cost of financial asset investments measured at fair value through profit or loss (£188 million compared to £255 million in 2022 and 2023).

Chart: Analysis of the components of operating expenditure — 2023 and 2024 versus 2022 and 2023

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Operating income

Operating income totalled £410 million in 2023 and 2024, a significant decrease of £730 million (64%) from £1,140 million in the previous year. This is driven by movements in fair value on financial assets held at fair value through profit or loss, predominantly home equity assets.

In 2022 and 2023, house price growth led to the recognition of £621 million of home equity fair value increases. A fall in house prices in 2023 and 2024 meant that there was a net reversal of previous increases in fair value above initial cost.

Chart: Analysis of the components of operating income — 2023 and 2024 versus 2022 and 2023

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Help to Buy: Equity Loan repayment statistics^{[footnote 6]}

A summary of Help to Buy: Equity Loans issued at each financial year and the cumulative repayment of those loans at the end of 2023 and 2024.

Financial year	Number of loans issued	Number of repaid loans 2023 to 2024	Original cost of loans 2023 to 2024 (£ million)	Receipt from repaid loans 2023 to 2024 (£ million)	Number of repaid loans 2022 to 2023	Original cost of loans 2022 to 2023 (£ million)	Receipt from repaid loans 2022 to 2023 (£ million)
2023 to 2024	127	1	0.1	0.1	Not applicable	Not applicable	Not applicable
2022 to 2023	26,040	122	6	6.1	8	0.4	0.4
2021 to 2022	32,696	1,089	58.9	62.2	316	17	18.3
2020 to 2021	55,617	5,386	359.9	359.1	3,399	209	226.6
2019 to 2020	51,470	10,153	663.1	686	6,990	434.4	465
2018 to 2019	52,454	21,694	1,344.6	1436.3	13,554	829.6	883.6
2017 to 2018	47,948	27,830	1,685.90	1,799.6	25,194	1,509.6	1,609.2
2016 to 2017	39,965	26,649	1,484.7	1,585	25,261	1,401.70	1,491.9
2015 to 2016	33,755	24,462	1,150.1	1,281.4	23,727	1,116.1	1,238.6
2014 to 2015	27,793	21,553	941.9	1,081.8	21,051	921.2	1053.9
2013 to 2014	19,407	15,346	631.3	747.1	15,046	619.6	730.7
All years	387,272	154,275	8,326.5	9,044.7	134,546	7,058.6	7,718.2

The repayment statistics show that between April 2013 and March 2024 a total of 387,272 households bought homes with a Help to Buy: Equity Loan. By March 2024, a total of 154,275 households (39.8%) had repaid their loan. The repayment statistics also show that Homes England received £9,044.7 million from these 154,275 households, when the original cost of the loans was £8,326.5 million. The realised gain on disposal of £718.2 million reflects the Agency’s share of increases in the value of homes between the time the loan was issued and repaid.

Sustainability report

The Housing and Regeneration Act 2008, that established Homes England, sets out 4 statutory objects, including “to contribute to the achievement of sustainable development and good design in England”. We are committed to creating well-designed and sustainable places where people want to live, and to minimising the environmental impact of our activity while doing this.

In Spring 2023, we launched our strategic plan. This included a strategic objective to ‘enable sustainable homes and places, maximising their positive contribution to the natural environment and minimising their environmental impact’.

Our Strategic Objectives and the UN Sustainable Development Goals (UNSDG)

Primary links to UNSDGs where strategic objectives contribute to at least 1 target for each UNSDG are as follows:

Vibrant and successful places

Goal 3 — Good health and well-being

Goal 4 — Quality education

Goal 8 — Decent work and economic growth

Goal 10 — Reduced inequalities

Goal 11 — Sustainable cities and communities

Goal 15 — Life on land

Homes people need

Goal 11 — Sustainable cities and communities

A housing and regeneration sector that works for everyone

Goal 8 — Decent work and economic growth

Goal 9 — Industry, innovation and infrastructure

High quality homes in well-designed places

Goal 3 — Good health and well-being

Goal 11 — Sustainable cities and communities

Sustainable homes and places

Goal 7 — Affordable and clean energy

Goal 12 — Responsible consumption and production

Goal 13 — Climate action

Goal 15 — Life on land

Corporate health

Goal 5 — Gender equality

Goal 10 — Reduced inequalities

Goal 16 — Peace, justice and strong institutions

We have listed primary links to UNSDGs where strategic objectives contribute to at least 1 target for each UNSDG.

In fact, aspects of sustainable development are reflected in all our strategic objectives, whether that be facilitating the creation of the homes people need, supporting social justice, promoting the creation of high-quality homes in well-designed places that reflect community priorities, creating vibrant and successful places or building a housing and regeneration sector that works for everyone. All these objectives are supported by Key Performance Indicators (KPIs), set out further in the detailed performance review section, and contribute in some way to creating more sustainable communities, reducing inequalities and supporting sustainable economic growth; themes reflected in the United Nations’ Sustainable Development Goals (UNSDGs).

To help us build on these objectives and KPIs, and embed sustainability in our everyday thinking, in Autumn 2023 we launched our ‘Living Sustainably’ statement of intent to our staff. This has helped us understand what good looks like across 3 themes: resilient, healthy, and inclusive.

This report of our progress on sustainability over the last year is structured around our sustainability governance, the outcomes in our Living Sustainably statement of intent and its themes, the people at the heart of our sustainability activities and progress towards our Greening Government Commitments.

Robert Stone, Director, Technical Services, Homes England said: “This last year has been an important year for Homes England as it seeks to deliver the homes people need at the same time as responding to sustainable development challenges, such as responding to the climate and biodiversity crises. Importantly our new strategic plan helps steer us to sustainable place-making and we’ve been working hard throughout the year to set out our strategic priorities and to embed sustainability into our projects, programmes and partnerships.”

Sustainability governance

The Corporate governance section of our Annual Report shows our governance structure and documents committee performance. It also describes our senior management structure.

In support of the Board, our Cross Cutting Committee focuses on sustainability and design and is tasked with:

• promoting high quality homes in well-designed places that reflect community priorities
• increasing Homes England’s focus on enabling sustainable homes and places, maximising their positive contribution to the natural environment, and minimising their environmental impact

The Cross Cutting Committee meets quarterly to share expertise from across the industry and to review and support our ongoing work to develop sustainability quality standards. They work closely with our Executive Leadership Team to develop our sustainability and design agenda and through additional workshops, the Committee’s panel of experts also support us in developing our standards and policies.

Sustainability delivery

As well as this dedicated committee to consider sustainability and design, we have several mechanisms to drive change, including:

• dedicated in-house technical experts — who provide advice on sustainability policy areas and keep our suite of policies, procedures and guidance up to date
• Sustainability and Design Implementation — this cross-Agency group is tasked with programme management of an on-going, ambitious programme of work, with the aim of embedding and enhancing sustainability and design across all our activity.
• our Design Surgery process — which scrutinises projects for their design quality
• Building for a Healthy Life (BHL) reviews — our accredited BHL assessors monitor the homes and places we facilitate for alignment with Building for a Healthy Life (a design toolkit to help improve the design of places)
• Building with Nature assessments — our in-house approved assessors provide projects with advice on following the standards to create places that support wildlife, water and wellbeing.

Key Performance Indicators (KPIs)

The work we do is monitored via a series of KPIs. The Agency Board receives and reviews monthly performance information, scored against corporate targets. Further detail is included in the detailed performance review section of the Annual Report.

KPIs linked with Sustainability and Design

KPI 1 —Brownfield land reclaimed KPI 5 — Social value per pound of investment KPI 10 — Share of supported completions using Modern Methods of Construction (MMC) KPI 12 — Share of supported schemes that meet or exceed the agreed standards for design quality (in line with Building for a Healthy Life) KPI 13 — Building Performance – share of supported completions that are EPC rating B or above KPI 14 — Average percentage biodiversity net gain planned on supported schemes KPI 15 — Under development — embodied carbon of Homes England Supported development

Our sustainability and design outcomes

Our Living Sustainably statement of intent expresses sustainability and design in terms of 9 interconnected outcomes, grouped around 3 themes of ‘resilient’, ‘healthy’ and ‘inclusive’.

• resilient outcomes are outcomes that help ensure the places we interact with continue to deliver positive outcomes and support social justice, not just now, but in the future too
• healthy outcomes are outcomes that build a healthier natural and human environment
• inclusive outcomes are outcomes that help ensure that the projects we engage in bring benefits to communities that reflect local priorities

As we seek to deliver on the strategic objectives set out in our strategic plan, we will need to focus on these holistic outcomes. Work is underway to develop a ‘sustainability and design passport’ that will accompany projects through key stages in the project lifecycle and help to deliver the outcomes.

Achieving ‘social value’ and engaging the community are important aspects of all of these outcomes. We also use Building for a Healthy Life to drive higher standards and measure the quality and impact of places we support.

• Movement — Walking, wheeling, cycling and public transport are prioritised.
• Wellbeing — Homes and places support belonging, wellbeing and safety for all.
• Character — Homes and places are desirable, have a strong identity and sense of place.
• Accessibility — Homes and places are functional and accessible to all.
• Economy — Places support a thriving local economy with jobs and local services near where people live.
• Stewardship — Homes and places are made to last and well-looked after.
• Resources — Homes and places are net zero carbon and resource efficient.
• Climate — Homes and places respond to the impacts of climate change.
• Nature —Nature thrives, is protected and accessible to all.

Progress in our 3 central themes

Social value

What — We currently use the definition from HM Treasury Green Book as the starting point for our approach to ‘social value’. Using this, work is currently underway to establish a description that reflects broader environmental, social and economic opportunities to impact the wellbeing of communities and places.

How it’s used —The Agency’s new KPI for Social value per £ of investment is a projected measure of the quantifiable value of changes in people’s lives that impact their welfare because of Homes England funding.

Progress this year — This year, we established our social value KPI, carried out research aimed at strengthening the approach to economic appraisal and the measurement of social value and published 2 papers:

• Measuring the placemaking impacts of housing-led regeneration which identified the potential scale of wider benefits of a project beyond the development site itself.

• Brownfield Development Values, measures the social value associated with developing brownfield land. Work has also progressed on the development of our Environmental Social and Governance (ESG) framework including pathways to understand and deliver social value and social justice outcomes. This includes locally relevant social value outcomes at all stages in our project process.

Work has also progressed on the development of our Environmental Social and Governance (ESG) framework including pathways to understand and deliver social value and social justice outcomes. This includes locally relevant social value outcomes at all stages in our project process.

Community engagement

What — We define community engagement as ‘actively listening and engaging with people living, working, visiting and investing in an area so as to inform and shape our ideas, support long-term transformation and empower communities’.

How it’s used — From the outset, we work with partners and local communities to articulate the vision and ambition for the homes and places we enable.

Our internal community engagement team completes regular project reviews and helps teams to establish criteria for measuring success to demonstrate the impact of our approach.

Progress this year — Our Community Engagement Framework was updated for 2023 to 2028. It establishes our broad approach to community engagement and linked social value, our strategic commitments, and our resources.

Building for a Healthy Life

What — Building for a Healthy Life (BHL) is a design toolkit to help improve the design of places. It was produced by Design for Homes in partnership with the NHS and input from Homes England and MHCLG.

How it’s used: We have a team of independent assessors that undertake BHL assessment at key stages in a project lifecycle, culminating in a post construction review.

BHL scoring also forms part of review of developer bids for our investment programmes such as affordable housing and Brownfield, Infrastructure and Land Fund.

Progress this year — We have increased the number of internal BHL assessments to 12 sites, up from 7 the previous year. We have also contributed to the latest update to the BHL standard.

The following sections of this report are grouped around the resilient, healthy and inclusive themes, and include commentary on how we are achieving the sustainability outcomes that are associated with those themes.

Resilient outcomes

As we hear more and more about the effects of climate change on our world, as well as the current cost of living crisis, there is a need to consider how housing and the built environment can prepare for a future where the challenge may be quite different from today. Under this resilient theme we have considered our progress this year under the outcomes of climate, resources, and stewardship.

Climate

The way we heat, cool, and insulate our homes, as well as the decisions we make on a day-to-day basis on how we travel from home to work, all contribute to the greenhouse gases that continue to accumulate in the atmosphere, contributing to climate change.

As an arms-length public body we report the greenhouse gas emissions from our buildings and the vehicles we use. Our emissions over the last year, as well as how we have performed in relation to other Greening Government Commitment targets, are shown in the Greening Government Commitments section of this report. However, we know that the land we acquire, as well as the investments we make, will also generate carbon and other greenhouse gases. We commissioned a study during 2023 and 2024 to understand the scale of greenhouse gas emissions for each of the Agency’s activities. This will help inform future work to improve our emissions data and drive reduction in emissions where we have influence.

As well as carbon, we also report the energy performance of the homes we support under KPI 13. This is reported within the detailed performance review section of this Annual Report.

We have played an active role to support the sector to transition to the building of more sustainable homes and places. For example, we are working with homebuilder Keepmoat to demonstrate inclusion of low carbon technologies in their houses, such as air source heat pumps, solar photovoltaic cells, underfloor heating and electric vehicle charging points. Elsewhere, the Greenhaus development in Salford, supported by the English Cities Fund, was one of the first medium or high rise ‘Passivhaus’ certified buildings in the UK. The scheme comprises 100% affordable housing, enabled via our Affordable Homes Programme. We are also working with sector trade bodies and other forums such as the Future Homes Hub to promote best practice and prepare for the implementation of sustainability policies directly impacting upon the built environment.

Adaptation to climate change is also an important part of a resilient housing sector. Since 2021, all residential buildings that are delivered on land that we acquire and sell on to developers, or that are facilitated through our investment vehicles, have had to comply with Approved Document O of the Building Regulations which includes mitigation for overheating. However, we know that overheating is not the only risk from our changing climate. Many of the developments we support have included key features that should make them more resilient to changes to future weather.

In accordance with the Greening Government Commitments, we are required to develop a climate change adaptation strategy supported by a climate change risk assessment for our activities. Work on this strategy was initiated in 2023 and 2024 to understand how we could develop climate change risk assessments for our development estate. We also refreshed a series of technical briefs and guidance documents setting out what should be considered. These included issuing internal briefs and guidance to set out how flood risk assessment that takes climate into account can inform decisions on future development, and how wider sustainability can be considered.

We know that resilience to climate change is a key priority for us going forward. Our Task Force on Climate-Related Financial Disclosures (TCFD) report, which follows this Sustainability report, shows our current governance on climate related matters and outlines work we will undertake in the coming year.

Resources

A key part of getting to net zero is about considering whether we make the best use of resources, for instance, by switching high carbon materials for lower carbon, more sustainable materials. During 2023 and 2024, we commenced work on a new net zero route map which will aim to drive down our carbon footprint, including through promoting the circular economy, which aims to avoid waste.

The land we manage can be a source of waste materials, so it is important that we manage these. For example, our recently refreshed technical briefs include that demolition projects should, where feasible, reflect or go beyond Greening Government Commitment targets on waste and reduce the amount of waste going to landfill to less than 5%, and increase the proportion of recycling to at least 70% of waste. While sometimes we need to manage risks such as land contamination, which may restrict our options on recycling waste, where we commission a demolition strategy and materials management strategy, on a site-by-site basis, opportunities for our contractors to make the best use of on-site materials are explored.

House construction, too, can generate waste and make demands on resources. In fact, the construction and demolition sectors contribute around 68% of the UK’s total waste generation, of this around 93% is recovered ^{[footnote 7]}. Approximately 55% of the waste recovered in the UK is construction waste such as bricks, stone and road surfacing materials which are converted into usable aggregates.

However, this process also consumes a lot of energy, which results in high carbon emissions and economic costs. ^{[footnote 8]}

A key way of dealing with this is to champion Modern Methods of Construction (MMC) utilising a range of off-site and on-site construction techniques. MMC includes a prefabrication and industrialised construction process based on the off-site production and pre-assembly of components that afterwards will be transported to the site to be fully assembled. Amongst the key benefits of prefabrication are efficient materials use and waste reduction. A study by KLH Sustainability, comparing modular and traditional construction, concluded that modular construction results in over 45% reduction in material use and over 50% reduction in waste generation. ^{[footnote 9]}

When we ask developers to bid for our sites, we require them to tell us how they will use MMC and score them on this aspect of their proposals. For the Affordable Housing Programme, every strategic partnership must deliver at least 25% of homes using MMC.

We commission research on MMC and are currently carrying out a monitoring and measuring research study on the impact of MMC on the delivery of homes. The overall aim of the study is to provide impartial evidence and an objective assessment of the outcomes achieved by embracing the use of more advanced MMC technologies in respect of housing delivery. The study is reviewing the overall performance of MMC housing units by closely monitoring the different construction technologies.

We have also provided loans to MMC manufacturers to help develop the sector.

Stewardship

Stewardship means that we seek to ensure that the homes and places we are involved with are made to last and well looked after. This can involve taking the long view in relation to the community who will live or work in a place, and the nature and sense of place. Sustaining these factors can help to make a development, that we have supported, a great place to live.

For example, at Tattenhoe Park in Milton Keynes, development is taking place across several phases as the community is developed, including parkland and sports pitches. A robust masterplan and design code play an important role in achieving design quality across the developing phases. This does not mean that the site can’t evolve over time, and it is clearly important that stewardship also considers that residents’ priorities may change over the years. At Tattenhoe, 30% of houses are flexible, extendable homes. These are designed to facilitate their future extension or adaptation, including allowing for atelier spaces above garages, future reconfiguration of internal spaces or ground floor rear extensions.

Healthy outcomes

Building a healthier natural and human environment is important to the way in which we deliver sustainable homes and places. Here our focus is on 3 key outcomes: nature, movement, and wellbeing.

Nature

Our ‘nature outcome’ is defined as: ‘nature thrives, is protected and accessible to all’. This can mean working across our development and investment projects to ensure biodiversity is conserved and enhanced, soil and water resources are protected, and health and wellbeing benefits to communities are maximised. It also means working with other partners, such as Natural England and Defra, for example in preparation for new regulations, such as for biodiversity net gain. We share practical experiences of how new policies are working in practice with colleagues in other parts of government, to inform policy making.

As part of our public sector biodiversity duty (Environment Act 2021) and in line with the requirements of the Greening Government Commitments (GGCs), we recognise that protecting and enhancing nature is critical. We have begun to develop a Nature Positive Plan, due to be completed in the coming financial year to set goals to influence how we consider nature across our work.

As set out in Building for a Healthy Life, we want to create places that are well integrated into the site and their wider natural and built surroundings. We want site plans to look beyond the site boundary.

This includes identifying the places, facilities, and services they will need to connect to. It also includes responding to the existing movement of water and nature across sites and their wider surroundings. For example, sustainable drainage schemes (SuDS) can contribute towards an attractive and accessible network of public spaces.

Biodiversity net gain

Biodiversity net gain (BNG) ensures development has a measurably positive impact on biodiversity, compared to what was there before development. This ‘net gain’ is achieved when developers create new habitats or retain and enhance existing ones to benefit wildlife. This can be done on the development site, or where that’s not possible, on another site nearby. Following recent changes in legislation, BNG is now mandatory in England for new schemes, which must now achieve a net gain of at least 10%. We worked with Natural England to help promote good practice and the roll out of BNG.

In line with our new strategic objectives, our project teams look to achieve higher than mandatory levels of BNG where possible. Our new KPI 14 measures the average percentage of BNG planned on supported schemes, to assess the extent to which our schemes are planning for better than mandatory levels of BNG. A priority has therefore been ensuring BNG regulations are understood and embedded in delivery processes, including providing in-house training and awareness raising.

Nutrient Neutrality

We have schemes in areas affected by nutrient neutrality, which means we must bring forward development in a way that avoids net input of nutrients to sensitive habitat sites. We share our experiences with other organisations to promote good practice and contribute to cross-government initiatives that are developing nutrient neutrality solutions, such as Natural England’s Nutrient Mitigation Scheme.

Wildlife Licencing

We have also provided updated procedures and guidance for obtaining wildlife mitigation licences, including providing in-house training and awareness raising on compliance with licence requirements and best practice in managing licensable works.

Example project — Brookleigh, Burgess Hill

Green space is a key feature of our 3,500 home development at Brookleigh, which includes an extension to the Bedelands Nature Reserve and 83 hectares of open space (44% of the site). A 23% biodiversity net gain is predicted for the scheme (13% above the minimum requirement) with new areas of woodland, ponds and wildflower meadows being created and the planting of an estimated 200,000 new trees, shrubs and plants. This will help to create a varied and diverse range of habitat for native wildlife.

Movement

It is important that places are safe, pleasant, and easy to move around, and that local services and amenities are accessible. Therefore, walking, wheeling, cycling, and public transport are important considerations.

The BHL standard promotes putting the right infrastructure in place so that short trips can easily be made on foot or bicycle. It is therefore important that we work with stakeholders to get the best outcomes. A good example is Homestead View in south-west Rugby, where we held a community design event which included consideration of ‘active travel’. This can help to improve public health and air quality, while also reducing local congestion and carbon emissions.

Example project — Spencer’s Park, Hemel Hempstead

This is the first Homes England site to implement innovative zebra crossings, which prioritise pedestrians and cyclists at junctions and reduce vehicle speeds, as part of the development’s movement strategy. Prior to LTN 1/20 being introduced, cyclists were not supposed to use pedestrian zebra crossings, meaning that in many areas across the country, there are few safe crossing points and limited protected space for cycling. The movement strategy at Spencer’s Park overcomes this issue.

Our development projects are independently reviewed by the Design Network, a team of accredited independent BHL assessors, who look to ensure that the Department for Transport’s LTN1/20 guidance is being adhered to. Most residential streets should be low speed and low traffic enough for everyone to feel safe while cycling.

The Vision Led Approach to Transport

We have continued our engagement with the Department for Transport to understand the interpretation and potential application of a ‘Vision Led’ approach to transport. This approach is founded on the inter-relationship between:

• the sustainable and active travel and transport investments for a site
• the masterplanning of a site (particularly focusing on densities and amenities that increase the range of movement options for residents)
• the digital and smart place planning of the site — to enable residents to live and work locally

All of this is underpinned by changes in:

• the way traffic modelling is used and interpreted
• viewing all modes of transport across the entire day, rather than just the peak hours

We have been engaging with our suppliers and other agencies such as Active Travel England and National Highways to explore the links between our areas of work. We are also actively engaging with a number of local projects and partners to explore the potential for a vision led approach.

Wellbeing

For the Agency, it is important that ‘homes and places support belonging, wellbeing and safety for all’.

As set out in BHL, we recommend that our development partners assess what sport and leisure provision there is for people of all ages, paying particular attention to the needs of children, teenagers, and older people. We recognise that design concepts such as ‘play on the way’ can make car-free trips more fun for children and can encourage them to want to walk or cycle to school.

We recently contributed evidence to the MHCLG Select Committee Inquiry into children, young people, and the built environment.

Example project — Northstowe

New lakes with integrated paths, cycleways, seating and ‘play-on-the-way’ provision have been delivered as part of the strategic infrastructure for our development at Northstowe. They form part of the sustainable drainage strategy, but also careful landscaping has meant that they benefit the community as a recreational resource and accommodate nature as a biodiversity feature. The paths are well used by families, dog walkers, bird-spotters and joggers.

Inclusive outcomes

It is important that, in delivering sustainable development, we seek to deliver benefits, not just for home occupiers, but for the community as a whole. To this end, we have defined ‘inclusive outcomes’ to focus on 3 key areas: economy, character, and accessibility.

Economy

Our ‘Economy Outcome’ is focused on shaping places that support a thriving local economy, with jobs and local services near where people live. This can mean working across our development and investment projects to ensure we can maximise the opportunities for local people to access jobs, education, health, leisure, and recreation.

The Building for a Healthy Life standard is helping to create places that offer nearby social, leisure and recreational opportunities. We encourage our development partners to consider improving existing facilities based on evidenced local need.

We have been utilising digital tools such as ‘Space Syntax’, which is a science-based approach to analysing, planning and design in settlements, by looking at the way the layout of places affects behaviour. Movement patterns can play a role in, for example, the overall levels of natural surveillance, which can help reduce crime.

Example project — South West Rugby

We utilised Space Syntax for our development at South-West Rugby, to inform the site vision and test masterplan options. Using the analysis enabled us to predict where the most connected and busiest streets would be, which then informed where the new neighbourhood centre should be located. The tool was also able to recommend appropriate block sizes to create a more walkable street network.

South West Rugby also has a Building with Nature Design Award.

Character

‘Character’ in the context of our work means homes and places that are desirable, have a strong identity and a sense of place. This means that we look to enhance natural, landscape, historic, or cultural features in the places we work in and set out to create places that are memorable, distinctive and understanding of the local character.

Again, through Building for a Healthy Life, we seek to influence our development partners to work with local stakeholders to agree a shared vision that understands and responds to a place to make the most of what is already there, be that by making use of the local topography or natural or cultural features on or beyond the site. This can create places that are memorable, with a locally inspired or otherwise distinctive character.

Example project — Rochdale Riverside

This scheme utilises wayfinding and public art effectively to enhance the site and complement its natural environment and industrial heritage. References to Rochester’s rich conservation area and Chatham’s Historic Naval Dockyard are reflected in the scheme’s materials, roofscapes, detailing and proportions. In partnership with the Local Authority, Homes England provided the initial investment on site assembly and engineering works. The River Walk, provided at an early stage in the development has been a huge benefit to the community.

Accessibility

Our ‘Accessibility Outcome’ is defined as: ‘Homes and places are functional and accessible to all’. We adopt the principles of inclusive design. These involve making a development or place inclusive so everyone can use it safely, conveniently and easily, with dignity. Developments should also be welcoming, with no disabling barriers that might exclude some people. We recognise that one solution may not work for all.

Building for a Healthy Life aims to ensure that our developments provide a range of homes that meet local community needs. This includes providing a mix of housing types and tenures that suit the needs of the local community, which may include first time buyer homes, family homes, homes for those downsizing and supported living. We encourage the use of best practice in terms of maximising the opportunities offered by supported accommodation, and our guidance promotes developments that offer people access to private outdoor space, which is important for people’s mental health and wellbeing.

Locally relevant place-based indicators

Through effective community engagement, a clear understanding of locally relevant needs and opportunities can be understood. This is important if we are to ensure our projects reflect community priorities.

A key tool that we have developed and are trialling on a range of projects is ‘place-based indicators’.

These indicators are locally informed and used to focus future community engagement activity. They help ensure projects are aware of local needs and opportunities at an early stage in the planning, housing and regeneration process.

Example project — City Hospital, Birmingham

We engaged with the local community early in the planning process to collect views from residents. Key issues highlighted included fear of crime and anti-social behaviour. The feedback resulted in a proposal to make improvements to an existing bridge and adjacent open spaces just outside of the site, rather than providing a new bridge link, which had been the original intention. These decisions will increase connectivity beyond the site boundary.

People at the heart of sustainable development

Engaging our people

We strongly feel that to achieve our sustainability and design outcomes, we need the right culture, processes, and support to equip our colleagues to deliver the quality that is envisaged. An important part of that process which has changed significantly this year, is that we are using an independent Design Network who are accredited BHL assessors, as part of our site disposal process.

At the Homes England Annual Staff Conference in November 2023, the ‘Illuminating Social Value’ workshop attracted over 200 participants to hear examples of social value that are being progressed within projects. In addition, a workshop on sustainability and design was held to promote our Living Sustainably statement of intent.

Our Graduate Programme

Homes England has been running a successful graduate programme for several years. Some of the key aims of the programme include:

• to attract and develop diverse ideas and ways of working to disrupt the housing market
• to develop the next generation of future leaders in the housing sector, to help us deliver more housing
• to invest in ‘growing our own’ skills and capabilities needed for the future to deliver our strategic plan, and aid succession planning.
• to provide a breadth of experience and knowledge from multiple areas of the Agency

In 2023 and 2024 we employed 15 graduates. Many of our graduates have progressed to full time roles within the Agency.

Freya Oldham, a graduate who undertook a placement in the Sustainability and Design Team at Homes England said: “Completing a 6-month placement in the Sustainability and Design Team has been a great learning experience, fantastic opportunity to develop interpersonal and technical skills and, overall, a very fulfilling role. Being supported by my manager and the wider team, I’ve had the opportunity to get involved in several key areas of work, focusing on tasks of real importance but also real interest to myself. With the encouragement and inspiration of working alongside such a vocal and determined team, I’ve been able to approach my projects with an open-minded and inquisitive demeanour. Probing and exploring new, sustainable perspectives and possibilities — which is learning I can take forward into any future role.”

Learning and development

To successfully deliver on our sustainability and design outcomes, it’s imperative that we equip staff with technical skills relevant to their business area. During this year we have been exploring and promoting potential training provision, suitable and tailored for Homes England. We promoted sustainability training modules available from a variety of providers and organisations to colleagues this year. In addition, we have partnered with the Supply Chain Sustainability School, a leading industry training provider offering a diverse array of learning opportunities, from offsite construction to biodiversity and social value. This training will be a cornerstone of our sustainability learning provision in the coming year.

Local Government Capacity Centre

We have been supporting our Local Authority partners to deliver sustainable, well-designed places through our ongoing package of learning sessions.

In July 2023 and between January and February 2024, our Local Government Capacity Centre provided 30 free webinars for attendees across all levels of local government in our Summer and Winter Learning Programmes. Topics ranged from ‘active travel’ to ‘Sustainable Drainage Systems (SuDS)’.

Communities

Communities are critical to the design and development of sustainable and thriving places. We place great emphasis on engaging and listening to these communities.

The Greening Government Commitments

The Greening Government Commitments (GGCs) set out the actions to be taken by the UK Government departments and partner organisations like Homes England to reduce their impact on the environment.

The GGCs include targets under 7 themes.

Our commentary on progress with our Nature Positive Plan and climate adaptation strategies are discussed in our sections on Nature and Climate. Our performance against some key targets on greenhouse gas emissions, waste, water, procurement and information technology are discussed in this section of the report.

Scope of Greenhouse Gas Emissions under the Greening Government Commitments

• Scope 1 — These emissions occur from sources owned or controlled by the organisation. Includes all direct emissions from leased vehicles in the Homes England fleet and direct emissions from gas used in heating our offices.
• Scope 2 — These emissions result from energy consumed which is supplied by another party. They comprise indirect emissions from energy use (electricity, heating and cooling, including transmission losses) in our managed offices.
• Scope 3 — These emissions result from energy consumed which is supplied by another party. They comprise indirect emissions from energy use (electricity, heating and cooling, including transmission losses) in our managed offices.

Table: Greenhouse gas emissions

		2017 and 2018 (Baseline)	2019 and 2020	2020 and 2021	2021 and 2022	2022 and 2023	2023 and 2024	Comparison to 2017 and 2018 Baseline	Comparison to prior year	Target and Status
Emissions (tonnes CO2e)	Total Scope 1 (direct) emissions	387	400	85	77	65	155	Down — 60% decrease	Up	25% reduction against baseline. Target met.
Emissions (tonnes CO2e)	Total Scope 2 (direct) emissions	303	216	177	62	57	141	Down	Up	—
Emissions (tonnes CO2e)	Total Scope 3 (direct) emissions	353	477	34	111	231	355	Up	Up	—
Emissions (tonnes CO2e)	Total emissions (Scope 1, 2 and 3)	1,043	1,093	296	250	353	652	Down — 38% decrease	Up	47% reduction against baseline. Target not met,
Related Energy Consumption (MWh)	Gas consumption	550	842	372	214	0	248	Down	Up	—
Related Energy Consumption (MWh)	Electricity consumption	789	702	395	218	152	518	Down	Up	—
Related Energy Consumption (MWh)	District heat consumption	—	—	—	66	139	139	No baseline data.	No change.	—
Financial indicators (£000’s)	Energy consumption	132	130	105	85	38	73	Down	Up	—

Table: Business travel

		2017 and 2018 (Baseline)	2019 and 2020	2020 and 2021	2021 and 2022	2022 and 2023	2023 and 2024	Comparison to 2017 and 2018 Baseline	Comparison to prior year	Target and Status
Emissions (tonnes CO2e)	Domestic flight emissions	5.06	3.32	0	3.04	6.07	5.81	Up — 14.8% increase	Up	30% reduction against baseline. Target not met.
Total number of business flights (number)	Domestic flights	95	246	0	60	113	92	Down	Down	—
Total number of business flights (number)	International flights	—	—	—	42	26	17	No baseline data.	Down	—
Distance travelled (000s of km)	Domestic flights	34	21	—	24	47	36	Up	Down	—
Distance travelled (000s of km)	International flights (short haul economy)	—	—	—	—	24	30	No baseline data.	Up	—
Distance travelled (000s of km)	International flights (short haul economy)	—	—	—	—	24	30	No baseline data.	Up	—
Distance travelled (000s of km)	International flights (long haul economy)	—	—	—	—	22	0	No baseline data.	Down	—
Distance travelled (000s of km)	Car travel total	2,371	2,524	247	513	835	2,848	Up	Up	—
Distance travelled (000s of km)	Total business travel	6,572	8,296	314	2,078	4,997	6,166	Down	Up	—
Distance travelled (000s of km)	Total distance per full time equivalent (FTE) staff	8.4	7.9	0.2	1.5	3.6	4.2	Down	Down	—
Financial indicators (£000’s)	Official business travel	1,772	3,164	437	1,052	1,169	2,114	Up	Up	—

Table: Waste

		2017 and 2018 (Baseline)	2019 and 2020	2020 and 2021	2021 and 2022	2022 and 2023	2023 and 2024	Comparison to 2017 and 2018 Baseline	Comparison to prior year	Target and Status
Non-financial indicators (tonnes)	Total waste generated	26.70	43	62.6	19.57	26.22	33.52	Up — 26% increase	Up	15% reduction. Target not met.
Non-financial indicators (tonnes)	Hazardous waste: landfill	0.03	0	0	0	0	0	Down	No change	—
Non-financial indicators (tonnes)	Non-hazardous waste: landfill	1.11	1	3.7	0	0	4.66	Up	Up	—
Non-financial indicators (tonnes)	Non-hazardous waste: incineration with energy recovery	2.74	2	3.9	4	4	9.14	Up	Up	—
Non-financial indicators (tonnes)	Non-hazardous waste: recycled	16.49	40	55	16	22.08	18.76	Down	Up	—
Non-financial indicators (tonnes)	Non-hazardous waste: ICT reused or recycled	6.34	0	0	0	0.51	0.96	Down	Up	—
Non-financial indicators (%)	Recycling rate	85	98	94	82	84	58	Down	Down	70% recycling. Target not met.
Non-financial indicators (%)	Landfill rate	4	2	6	0	0	14	Up	Up	Less than 5% to landfill. Target not met.
Financial indicators (%)	Landfill and incineration rate	15	14	42	24	0.78	0.57	Down	Down	—
Financial indicators (%)	Recycling	9	29	19.8	19	5.72	3.85	Down	Down	—
Financial indicators (%)	Total ICT, waste, recycled, reused and recovered (externally)	—	—	—	—	3.99	6.61	New metric	Up	—

Table: Resource use

		2017 and 2018 (Baseline)	2019 and 2020	2020 and 2021	2021 and 2022	2022 and 2023	2023 and 2024	Comparison to 2017 and 2018 Baseline	Comparison to prior year	Target and Status
Non-financial indicators (Number)	Number of A4 reams consumed	5,542	8,755	234	1,384	747	865	Up — 84% decrease	Up	50% reduction against baseline. Target met.
Non-financial indicators (Number)	Number of reams per FTE staff	7.1	9.5	0.2	1	0.5	0.6	Down	Up	—
Non-financial indicators (Number)	Number of reams per FTE staff	7.1	9.5	0.2	1	0.5	0.6	Down	Up	—
Financial indicators (£’000)	Paper procurement	19	26	0.96	1	3	5	Down	Up	8% reduction against baseline. Target met.
Non-financial indicators (£’000)	Water use — supplied (none abstracted)	1,553	3,439	3,131	1,592	205	1,088	Down	Up	8% reduction against baseline. Target met.
Non-financial indicators (£’000)	Water use per FTE staff (HE owned offices)	4.2	4.3	3.4	1.1	0.3	1.1	Down	Up	—
Financial indicators (£’000)	Water supply and sewerage costs	19	20	24	8	3.9	0.4	Down	Down	—

Notes on data

• In 2023 and 2024, there was no expenditure on the Carbon Reduction Commitment Allowances or any carbon offset schemes.

• Reported gas emissions decreased in 2022 and 2023 as the scope of offices in that reporting period did not include any gas heated buildings. 2023 and 2024 includes 2 offices heated by gas, which has led to the reported increase in gas consumption.

• Utilities and waste data are presented for the operational offices we either directly manage (Northstowe) or those where we are tenants in a building which is not a government hub (Bristol, Coventry, Liverpool, London and Newcastle). Due to the limited number of desks we lease in Guildford, Leeds and Manchester offices, the utility data at these locations is reported separately by the lead government departments in each office.

• Water supply costs relate to Northstowe only and waste costs relate to Northstowe and our ‘Collect Eco’ furniture recycling contract. All other offices include waste services under a combined service contract.

• Utilities and waste volumes apportioned to non-government tenants in these offices are excluded.

• Travel and paper use data is for the whole organisation.

• CO2e refers to carbon dioxide equivalent, a universal unit of measurement to indicate the global warming potential of a greenhouse gas, expressed in terms of the global warming potential of 1 unit of carbon dioxide.

• MWh = Megawatt Hours

Performance against some key GGC targets (2017 and 2018 baseline year)

Greenhouse gas emissions

• Total emissions target 47% reduction. We achieved 38% reduction.
• Scope 1 emissions target 25% reduction. We achieved 60% reduction.

Waste management

• Target overall 15% waste reduction. We recorded 26% increase.

Water consumption

• Target 8% reduction. We achieved 30% reduction.

Greenhouse gas emissions

Homes England’s combined greenhouse gas emissions reported under the GGCs in 2023 and 2024 have reduced by 38% since our baseline year. As highlighted in the resilient outcomes section, we completed a greenhouse gas emissions assessment during 2023 and 2024 to understand our broader emissions (Scope 3 emissions) beyond the scope of the GGCs and will be developing a net zero route map and actions to reduce emissions within our scope of influence in the coming year.

We are not on track to achieve our target of a 47% reduction in total emissions as defined under the GGCs by 2025.

We have met our sub target to reduce Scope 1 emissions (those relating to fleet vehicle emissions and gas use), by 25% this year, achieving a 60% decrease on the 2017 and 2018 baseline. This reduction in Scope 1 emissions can be attributed to our success in the broad adoption of low or zero emission vehicles in the Agency’s leased fleet.

Business travel

Overall, our total distance travelled for business purposes remains below the baseline year of 2017 and 2018, but shows a continuing increase compared to the distance travelled in the last 3 consecutive years. This is a reflection of both increasing staff numbers and our range of activities across the country returning to levels seen prior to the pandemic.

Flights

Our distance travelled by domestic and international flights decreased during 2023 and 2024 compared to the prior year but increased compared to the baseline year in 2017 and 2018. Our emissions from flights have also marginally increased compared to the baseline and, as such, we have not met the GGC sub target to reduce emissions from flights. This increase in emissions is a reflection of flights to meet strategic business needs.

Ultra-Low Emissions Vehicles (ULEV)

The Agency has made further progress this year with respect to its Car Lease Scheme and transitioning from petrol and diesel cars to ULEV. 94% of cars under our lease scheme are ULEV cars. We remain on track towards being 100% ULEV by 31 December 2027.

Travel is an area we will continue to focus on to encourage more sustainable behaviours.

Waste management

Through initiatives in our digital and facilities management teams, we have made positive progress with reuse schemes this year. We diverted 1.2 tonnes of office furniture and 0.3 tonnes of IT equipment from disposal into reuse schemes. As part of our move into a new office in Manchester, we reused a significant quantity of furniture such as chairs and monitors from items we hold in storage, to avoid purchasing new equipment.

A combination of increased staff numbers and 2 new offices in the scope of reporting during 2023 and 2024 has, however, led to an overall increase in waste disposal reported across the office estate. As a result of these changes, we have not met our headline target to reduce waste by 15% from the 2017 and 2018 baseline, or the sub-targets to divert 95% of waste from landfill and recycle at least 70% of our waste. Recognising these challenges, we recently initiated a campaign to encourage colleagues to increase our rates of recycling and reduce waste.

Resource consumption: paper and water

Against the 2017 and 2018 baseline we have reduced paper consumption by 84% this year. This exceeds the target of a 50% reduction against the baseline. This achievement can be attributed to changing behaviours by staff to reduce printing and photocopying.

We have met the commitment to reduce overall water consumption by 8% against the 2017 and 2018 baseline and achieved a decrease of 30%. This is an increase on consumption reported in 2022 and 2023 as a result of increased staff numbers and additional offices being included in the scope of reporting.

The environmental impact of ICT

Information and Communication Technology (ICT), through allowing flexible working and reducing the need for paper-based reporting and data storage, can have significant environmental benefits. However, the hardware used along with the storage of data also has environmental costs. ICT such as laptops, and collaborative software applications, enable working in a dispersed way, and can save on travel miles and pollution. This is vital as we often work with partner agencies based at a distance from our offices.

To prepare for future reporting on greenhouse gases and digital services, our Digital directorate have undertaken a preliminary review of existing practices and future opportunities, including around mitigating climate change, minimising waste and sustainable procurement. Key activity includes:

• sharing facilities with other government users, via crown hosting
• use of Restore IT to manage redundant hardware
• use of refurbished headsets
• suppliers having policies in place on recycling

Sustainable procurement

We take account of government mandatory Buying Standards when procuring goods and services, and our procurement policy follows Crown Commercial Service principles. Where relevant, we are embedding procurement policy notes on social value and carbon management plans.

We are working with others in government to introduce Whole Life Carbon reporting across our activity, and this will include working with the construction and housing sector to monitor and report embodied carbon.

Environmental Social and Governance (ESG) matters are material considerations for our partnerships, and we seek to work with partners who set bold ambitious objectives, through both mandatory and voluntary ESG and sustainability reporting.

During 2023 and 2024, we began to develop a sustainable commercial policy and strategy. This will establish sustainable principles that will apply throughout our commercial activities from procurement of site maintenance, enabling demolition and construction contracts, through to our other interventions across the housing sector.

Sustainable construction

The Agency does not build homes directly; rather it provides resources, either in the form of de-risked land or funding support to others to do this. Through our relationship with housebuilders, we are encouraging them to consider ways to improve the energy performance of the homes they build and to implement sustainable construction practices.

Where we are directly involved in the de-risking of land and the provision of infrastructure, we make use of Crown Commercial Services Construction Works framework and the principles in the Government’s Construction Playbook.

Our Delivery Partner Dynamic Purchasing System Framework is a platform through which developers can bid to acquire our land and is open to new applicants on a rolling basis. The qualification process for this framework requires prospective developers to demonstrate a commitment to environmental protection through ISO 14001 accreditation or an aligned environmental management system. Furthermore, at the tender stage for sites, sustainability is a key part of the technical scoring criteria of prospective bids.

Environmental incidents

There were no significant environmental incidents reported on Homes England operated estates during 2023 and 2024. 5 environmental incidents and 3 near misses were reported that included developer partner and contractor incidents relating to waste management, surface water management, minor pollution incidents and trespass.

Consumer single-use plastics

Homes England is committed to reducing the use of Consumer Single-Use Plastics (CSUP) across the office estate. This year we made further progress towards plastic free office supplies, for example, working with our supplier Banner to develop an approved list of plastic free stationery supplies for facilities staff to use when re-stocking office provisions.

Across the financial year, such initiatives have reduced CSUP purchases from 22,543 items in the first quarter to 5,438 items in the final quarter. By working collaboratively with our supply chain, we will continue to seek out more opportunities to reduce Single-Use Plastics throughout our estate.

Forward look

Following the launch of our strategic plan, a key part of our work during 2023 and 2024 has been about re-organising our governance and levers of influence to embed sustainability and design in a way that aligns with our strategic priorities. With this strategic work nearing completion our focus turns to delivery. Likely areas of work include:

• Statement of intent promotion
• Communications and engagement
• Embedding tools for sustainable delivery
• Measurement and indicators
• Training

Task Force on Climate-Related Financial Disclosures report

Climate change is a key issue for housing and regeneration. The way that places are designed and built, the way that buildings are heated and cooled, and the journeys we make from our homes to places of work, study and leisure all play important roles in getting us to net zero carbon. We need to prepare for the challenges and opportunities that climate change presents.

For example, the UK Climate Change Risk Assessment has highlighted a range of risks to the built environment and related sectors that are likely to increase in the coming decades, even in more optimistic climate scenarios.

The Financial Stability Board (FSB), founded by the G20 economies, established the Task Force on Climate-Related Financial Disclosures (TCFD) in 2015 to bring greater transparency on the financial implications of climate change.

In 2023, HM Treasury published guidance on TCFD aligned disclosure for government. Government Arms-Length Bodies (ALBs) are required to follow this guidance if they have more than 500 full-time employees or a total operating income of more than £500 million. Homes England meets these criteria and therefore follows the HM Treasury guidance in this report.

The HM Treasury guidance sets out a phased approach to TCFD reporting, with 3 phases in total. Phase 1 reporting commenced in 2023 and 2024 and is reflected in this report. Phase 2 and Phase 3 reporting will follow in the next 2 years (2024 and 2025 and 2025 and 2026).

Reflecting the Task Force’s recommendation, the HM Treasury guidance splits out relevant disclosures into 4 thematic areas: governance, strategy, risk management, and metrics and targets. Within this report, Homes England presents its TCFD Compliance Statement, together with its Phase 1 TCFD disclosures on governance, metrics and targets.

TCFD Compliance Statement

Homes England has reported on climate-related financial disclosures consistent with HM Treasury’s TCFD-aligned disclosure application guidance which interprets and adapts the framework for the UK public sector. Homes England has complied with the TCFD recommendations and recommendations disclosures around:

• governance (all recommended disclosures)
• metrics and targets (disclosures (b))

This is in line with the central government TCFD-aligned disclosure implementation timetable. Homes England plans to make disclosures for Strategy, Risk Management and Metrics and Targets disclosures (a) and (c) in future reporting periods, where required, in line with the implementation timetable.

Governance

Good governance structures are essential for us to meet our sustainability objectives and effectively manage climate-related risks and challenges.

TCFD governance disclosure: a) Board oversight

Homes England is governed by a Board, which has the responsibility of ensuring we meet our statutory objects and strategic objectives. To aid its oversight and ensure there is appropriate focus placed on our priorities, which include sustainability, the Board receives reports from the Executive and is supported by Board Committees and Advisory Groups. The structure of our Board and Committees is set out in the Corporate governance section of this Annual Report.

3 Board Committees are particularly relevant to ensuring the Board has oversight of climate-related issues. These are the:

• Audit, Assurance and Enterprise Risk Committee (AAERC)
• Cross Cutting Committee
• Investment Committee

The relationship of key committees to the board is shown in the Corporate governance section of the Annual Report.

Audit, Assurance and Enterprise Risk Committee

This Committee supports the Board in their responsibilities for risk control, governance, audit, financial stewardship and financial and statutory reporting.

Following the Annual AAERC self-assessment, the need for additional reporting on sustainability and net zero within the Risk Management Framework was identified, as was the need for optimal integration of climate change factors into the Risk Management Framework. As the specific scope, metrics for success and alignment with business objectives are refined, the goal is to enhance the effectiveness of our risk management processes in addressing climate-related challenges.

The Risk Management Framework is described in greater detail later in this TCFD report.

Cross Cutting Committee

This time-limited Committee supports the Board in fulfilling its responsibility for a greater focus on the cross cutting ‘quality’ objectives, as detailed in the strategic plan. The Sustainability governance section of the Sustainability report summarises its key areas of work, including across sustainability and design.

A key area of discussion in the last year has been around the development of Homes England’s Living Sustainably statement of intent ^{[footnote 10]}, which includes outcomes relating to climate (homes and places respond to the impacts of climate change) and resources (homes and places are net zero carbon and resource efficient).

Investment Committee

The Investment Committee considers our largest and most significant new development and investment proposals, and reviews business cases.

The Committee’s decision making is informed by business cases that apply the 5-case model as recommended by HM Treasury. The assessment of value for money within these business cases follows guidance provided in the Ministry of Housing, Communities and Local Government (MHCLG) Appraisal Guide and includes an assessment of both monetised and non-monetised impacts.

The purpose of the economic dimension of the business case is to identify the proposal that delivers best public value to society, including wider social and environmental effects. Work is currently being progressed within our Economics Team to update elements of the business case to improve the appraisal of environmental impacts within the broader economic appraisal. This will include a range of impacts, including greenhouse gas emissions related to land take, construction and occupation, as well as guidance and tools to allow users to undertake a proportionate level of analysis for their projects. This guidance draws on the Enabling a Natural Capital Approach (ENCA) guidance from the Department for Environment, Food and Rural Affairs (DEFRA), together with guidance from the Department for Energy Security and Net Zero (DESNZ). It is also consistent with the HM Treasury Green Book and MHCLG Appraisal Guide.

TCFD governance disclosure: b) Management’s role in assessing and managing climate-related risks and opportunities

Homes England recognises the significant impact climate change could have on our operations and the delivery of our strategic goals. We are committed to managing these risks effectively, while continuing to support the creation of sustainable homes and places.

The Board and its Committees are supported in assessing and managing climate-related risks and opportunities by the Homes England staff, led by the Executive Leadership Team (ELT). The ELT retains responsibility for delivery and assurance to the Board of the strategic plan objectives, as well as risk, budget and performance reporting.

Integrated Risk Management Framework (RMF)

Our RMF accommodates climate change risks as a key driver within existing structures, ensuring a nuanced and tailored approach. Within this framework, “Sustainability” is a secondary risk category under the primary risk of “Intervention”. This allows us to go beyond generic guidance and develop a deeper understanding of sustainability related risks specific to our activities, considering factors like:

• preventative measures and recovery actions for development projects
• regulatory compliance for both interventions and corporate health
• wider business goals and potential risk interdependencies

Risk appetite — The Board-approved Risk Appetite Statement allows for calculated risks and innovation to address challenges, including those related to sustainability. This openness enables us to adapt to changing circumstances, such as emerging climate threats, while still pursuing our mission of enabling sustainable homes and places.

Cross Cutting Risk Identification — We proactively identify and manage climate change risks as part of our broader risk assessments. This includes:

• Project Risk Assessments (PRAs): These assessments consider climate change as a potential driver of risk at the project level
• Directorate Risk Registers: Risks identified through PRAs are escalated and aggregated within directorate risk registers, ensuring a comprehensive overview
• Enterprise-wide Risk Reporting: Risk reports highlight cross cutting themes, including climate change, to raise awareness and encourage a joined-up approach across the Agency

Data-driven Decision Making — We are establishing baselines and data recording protocols for our new sustainability metrics. This data will inform future risk appetite evaluations, allowing us to make informed decisions about the appropriate level of risk for sustainability-related activities.

By combining these elements, our approach ensures that climate change risks are considered throughout our operations, from project inception to Agency-wide strategic planning.

It is important to note that risk identification may come from both enterprise top-down principal risk evaluation and bottom-up identification of risks via project and director level risk registers.

These risk registers account for the potential impact of climate change on our interventions via the secondary risk category of sustainability. This secondary risk is defined in the Agency’s Risk Management Framework.

Management’s role in meeting Greening Government Commitment targets

The Agency also has corporate targets under the Greening Government Commitments that seek to reduce the impact on the environment from our corporate activity. These targets include climate-related targets related to Scope 1, Scope 2 and part of Scope 3 greenhouse gas emissions (GHGE). They are reported to our sponsor department (MHCLG). Further detail on these metrics is contained within the metrics and targets disclosure, as well as in the Sustainability report.

Metrics and targets

A phased approach to metrics and targets

A key element of the TCFD recommendations is around disclosing metrics and targets. This allows stakeholders to better assess how an organisation is progressing on climate-related issues and provides a basis for comparison with other organisations.

Under TCFD there are 3 recommended disclosures under metrics and targets (read the ‘TCFD Next Steps’ section of this report). However, HM Treasury guidance on TCFD reporting recommends a phased approach to reporting.

For this report (2023 and 2024), which is year 1 of the phased approach, the requirement is to disclose Scope 1, Scope 2 and if appropriate Scope 3 GHG emissions and the related risks, consistently with the Annual Report. In order to meet this requirement, the HM Treasury Guidance clarifies that currently, the Greening Government Commitments, to which Homes England reports, include Scope 1, Scope 2 and Scope 3 (business travel only) emissions. As Sustainability Reporting Guidance (SRG) requires these same emissions scopes for annual reports, further categories of Scope 3 GHG emissions (in addition to business travel) are not required for Greening Government Commitments or SRG purposes.

We provide a definition of what is included in our Scope 1, 2 and 3 in the ‘Greening Government Commitments’ section of the Sustainability report.

TCFD metrics disclosure: b) Scope 1, Scope 2, and, if appropriate, Scope 3 GHG emissions and the related risks

Our Scope 1, 2 and 3 GHG (business travel only) emissions are disclosed in the Greening Government Commitments section of the Sustainability report.

Our performance on reducing greenhouse gas emissions against our GGC targets is on track to meet the 47% reduction target, set by government for MHCLG, for total Scope 1, 2 and 3 emissions for the period 2021 to 2025. We have also achieved the direct emissions (Scope 1) reduction target this year.

These targets have been achieved through moves to more energy efficient offices and increased adoption of low emission vehicles in our lease fleet. The change in our fleet is a result of our work towards achieving the sub target for increasing the proportion of ultra-low emission vehicles in our fleet to 93% this year.

We did not meet our GGC sub target to reduce emissions from domestic flights this year. Although the number of domestic flights taken by staff this year was marginally lower than the baseline year (92 flights compared to 95 in 2017) the location of staff and reasons for travel resulted in longer trips and greater emissions. The achievement of this target remains a risk to be addressed in the coming year. Additional metrics that relate to climate-related matters are in our strategic plan. They include KPI 13 and KPI 15, described in more detail within the coming year.

Additional metrics that relate to climate-related matters are in our strategic plan. They include KPI 13 and KPI 15, described in more detail within the Sustainability report. The status of these metrics, and reporting against them, where currently applicable, is described in the Performance analysis section of the Annual Report. We will be developing our approach to carbon management and reduction in the form of the Agency’s net zero route map.

TCFD next steps

As discussed in the introduction, this first TCFD report is a high-level review of our current position on climate-related issues and how they are covered by our governance, metrics, and targets. There are 2 further phases of reporting, which will require us to disclose further detail on risk management, strategy and further information on metrics and targets. HM Treasury has published guidance on Phase 2 ahead of this stage of reporting.

We set out the recommended TCFD disclosures by thematic area and by phase. At each phase a TCFD compliance statement must also be published.

TCFD Implementation Phasing

1 Recommendations

Phase 1 (2023 and 2024)

Governance — Disclose the organisation’s governance around climate-related risks and opportunities.

Metrics and targets — Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material.

Phase 2 (2024 and 2025)

Metrics and targets — Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material.

Risk management — Disclose how the organisation identifies, assesses, and manages climate-related risks.

Phase 3 (2025 and 2026)

Strategy — Disclose the actual and potential climate-related risks and opportunities on the organisation’s business strategy and financial planning where such information is material.

2 Recommended disclosures

Phase 1 (2023 and 2024)

Governance — a) Describe the Board’s oversight of climate-related risks and opportunities.

Governance — b) Describe management’s role in assessing and managing climate-related risks and opportunities.

Metrics and targets — b) Disclose Scope 1, Scope 2, and if appropriate, Scope 3 GHG emissions, and the related risks.

Phase 2 (2024 and 2025)

Metrics and targets — a) Disclose the metrics used by the organisation to assess climate-related risks and opportunities in line with its strategy and risk management process.

Risk management — a) Describe the organisation’s processes for identifying and assessing climate-related risks.

Metrics and targets — b) As Phase 1.

Risk management — b) Describe the organisation’s processes for managing climate-related risks.

Metrics and targets — c) Describe the targets used by the organisation to manage climate-related risks and opportunities and performance against targets

Risk management — c) Describe how processes for identifying, assessing and managing climate-related risks are integrated into the organisation’s overall risk management.

Phase 3 (2025 and 2026)

Strategy — a) Describe the climate-related risks and opportunities the organisation has identified over the short, medium, and long term.

Strategy — b) Describe the impact of climate-related risks and opportunities on the organisation’s businesses, strategy and financial planning

Strategy — c) Describe the resilience of the organisation’s strategy, taking into consideration different climate-related scenarios, including a 2 degrees Celsius or lower scenario.

In line with this guidance, the following risk management disclosures are to be included as part of our next annual reporting cycle:

• describe the organisation’s processes for identifying and assessing climate-related risks.
• describe the organisation’s process for managing climate-related risks.
• describe how processes for identifying, assessing and managing climate-related risks are integrated into the organisation’s overall risk management.

Further work on metrics and targets will also be required. However, the HM Treasury guidance suggests that these disclosures are subject to a materiality test to determine if they are necessary.

The following disclosures on metrics and targets are to be made, where such information is material:

• disclose the metrics used by the organisation to manage climate-related risks and opportunities in line with its strategy and risk management process
• describe the targets used by the organisation to manage climate-related risks and opportunities and performance against targets

We will also review the disclosures we have already made as part of Phase 1. We expect that this phased approach to reporting will allow us to check and challenge the robustness of our systems of governance in relation to climate-related issues.

Following completion of Phase 2 in the 2024 and 2025 reporting year we will continue our TCFD journey into Phase 3, which focuses on strategy.

The resilience section of our Sustainability report summarises our progress on a range of work relating to net zero and climate resilience. We will continue to embed climate resilience and decarbonisation in the work that we do across the coming year.

The Performance report is signed on 23 July 2024.

Peter Denton, Chief Executive and Accounting Officer