John Healey will use his first Budget on Wednesday to announce more than £1bn of new funding for social and affordable housing, the Daily Mirror has reported, with the paper saying the money could deliver up to 10,000 homes.
The Mirror, which published the story as an exclusive on Saturday evening, said the top-up would take the government's Social and Affordable Homes Programme to more than £40bn over the next 10 years. The Chancellor will also extend preferential borrowing rates so that more councils can borrow to build, according to the paper.
Neither figure has been confirmed by the Treasury. A Treasury spokesman, in a statement to the Mirror, did not repeat the £1bn or 10,000 numbers but said the Budget would "go further" on the Prime Minister's housing ambitions.
"This Budget will go further on that ambition through significant investment in affordable housing and helping councils borrow to build so we can replace what has been sold and give people a place to live," the spokesman said.
The Budget on 28 October is Healey's first since he replaced Rachel Reeves as Chancellor on 20 July, the day Andy Burnham became Prime Minister. Burnham has repeatedly promised what he has described as the biggest council housebuilding programme since the post-war period, a commitment he restated at the close of Labour conference last month, Inside Housing reported.
The reported top-up would be added to the existing Social and Affordable Homes Programme, a 10-year, £39bn grant fund running from 2026 to 2036. The programme was announced in mid-2025 under the previous Prime Minister, and the Commons debated it in November last year.
Measured against that baseline, a top-up of just over £1bn would amount to less than 3% of the programme's existing budget. The Mirror described the money as new funding but did not say how it is spread across the 10 years, or how the figure of 10,000 homes was calculated. On the paper's own numbers, the funding would work out at around £100,000 of grant per home.
The Mirror's headline described the money as building "council homes". The programme it would top up funds housing associations and other providers as well as local authorities, and the Treasury statement referred to "affordable housing" rather than council housing specifically.
Matthew Pennycook, the Minister of State for Housing and Planning, told the Commons in a written statement on 1 September that at least 60% of homes built under the programme are targeted to be for Social Rent, the lowest rent tenure. He said the government had "delivered the biggest boost to grant funding in recent memory through our new 10-year £39 billion Social and Affordable Homes Programme".
"Under the leadership of the new Prime Minister, the government is also determined not only to build upon the steps we have already taken to reinvigorate council housebuilding but to decisively raise our ambition to ensure we build council houses on a scale not seen in decades," Pennycook said.
The first wave of the programme's funding, nearly £10bn, was allocated on 25 August to 33 councils, housing associations and other providers designated as Strategic Partners. The same announcement included a £46m "Capacity to Build" package to support local authority skills and capacity.
Launching that first wave, Burnham said: "Councils built this country out of a housing crisis once before. Backed properly, and trusted to get on with it, they will do it again."
The Mirror reported that the Budget would also extend preferential borrowing rates for councils. A discounted rate for council housing borrowing through the Public Works Loan Board already exists. It was introduced at 40 basis points below the standard rate in the Spring Budget 2023 and extended by Jeremy Hunt in the Autumn Statement that November. The paper did not say how long the new extension would run or how many more councils it would cover.
The Mirror also cited the government's commitment to exempt newly built social homes from Right to Buy for 35 years after completion. That policy was first proposed in mid-2025 under the Starmer government and has since been confirmed.
Pennycook's September statement put the number of children in temporary accommodation in England at almost 180,000, including more than 100,000 in London.
Housing sector commentators have questioned the scale of the government's ambition. The Big Issue has asked whether the programme amounts to a "council housing revolution" or a "massive backtrack", and analysis reported by Yahoo suggested that more government funding would be needed to meet higher building targets.
The Budget documents, including the policy costings, will set out the detail of any new housing spending when Healey delivers his statement on Wednesday.
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