Up to £215m of government funding due to be handed to councils in Oxfordshire as part of its housing deal “may be withheld or clawed back” if certain targets and milestones are not met, it has emerged.
The government could also backtrack on the offer if any partner withdraws from the deal at any point, or fails to agree on a joint spatial plan by 2021.
The warnings are revealed in an outline agreement between Oxfordshire CC, the country’s five districts, and the Oxfordshire Local Enterprise Partnership, and a housing delivery plan which were signed by local leaders and housing minister Dominic Raab last month.
LGC revealed ahead of last autumn’s Budget that Oxfordshire was set to get a deal worth “hundreds of millions of pounds” in return for a promise to build about 100,000 homes by 2031.
On top of £340m local investment, the deal includes £150m government funding for infrastructure – released at £30m annually – to unlock housing sites although the county’s housing delivery plan acknowledges that money “does not meet the full funding gap to deliver … all 100,000 homes”. It will instead “support the delivery of approximately 6,500 houses” by 2022-23 and up to 14,000 by 2031.
A further £60m is available for affordable housing which will deliver “at least 1,320 affordable homes across a range of tenures to start on site by 2021”. In addition to this, the plan said Oxford City Council “will bid for additional [housing revenue account] borrowing flexibility from 2019” as part of government proposals to let councils in “high demand areas” borrow up to £1bn extra over three years for housing.
What constitutes a high demand area has been open to interpretation until now but Oxfordshire’s outline agreement said: “Oxfordshire is a high demand housing area with a house price to earnings ratio of 10.23 – well in excess of the national average of 7.72.”
An extra £5m will also be made available to boost councils’ capacity to get a joint plan in place and support the delivery of housing.
The Oxfordshire Growth Board, a joint committee made up of representatives from the councils, LEP and the county’s two universities, will oversee the deal’s delivery. Nothing can be built in a district without the council’s agreement, and the county council’s if transport infrastructure is required.
Annual reviews involving representatives from local partners, Homes England, the Ministry for Housing, Communities & Local Government and Department for Transport will be held each March from 2019.
While “exceptional circumstances beyond” councils’ control “such as economic downturn, adverse market conditions … will be taken into account” partners are warned: “Funding may be withheld or clawed back if milestones are not met.”
One milestone is for all councils involved to submit a local plan by 1 April 2019 with a view to agreeing a joint spatial plan by 2021. Should that not happen “this may result in cancellation of subsequent stages of the deal (and cessation of further investment)”.