Andy Burnham's vow of 'biggest council house boom since the War' has blown £8BILLION hole in Government spending plans, think-tank warns

By GREG HEFFER, POLITICAL CORRESPONDENT Published: 10:56, 24 July 2026 | Updated: 10:58, 24 July 2026 Andy Burnham's promise of a council house building boom is set to blow an £8billion hole in Government spending plans, according to a new report. The new Prime Minister has vowed to oversee the 'biggest council house building programme' since the post-Second World War period. But, in new research published on Friday, the Resolution Foundation think tank found that delivering 300,000 homes for social rent by 2036 would cost £47billion. This is £8billion more than the current £39billion of funding available for the Government's 10-year Social and Affordable Homes Programme (SAHP). The SAHP, which was announced under Keir Starmer's administration, aims to deliver 300,000 social and affordable homes over the next decade. It has a target of delivering at least 60 per cent - or 180,000 - of these homes for social rent, which sees tenants pay around 50 per cent of the local market rate. But the Resolution Foundation warned of an added cost of £800million a year, over the programme's 10-year lifespan, if Mr Burnham wants all 300,000 homes to be built for social rent. This is because social rent homes offer housing associations a lower lifetime rental income than other affordable products and therefore require more grant funding upfront to be viable products, the report said. Andy Burnham's promise of a council house building boom is set to blow an £8billion hole in Government spending plans, according to a new report The Resolution Foundation think tank found that delivering 300,000 homes for social rent by 2036 would cost £47billion The new Prime Minister has vowed to oversee the 'biggest council house building programme' since the post-Second World War period Without an uplift in SAHP funding, the think tank warned that if every house built under the programme was for social rent, it would mean building 51,000 fewer affordable homes overall - around 5,000 fewer a year. The report stated: 'If all the £39billion SAHP funding were allocated to social rent, just under 250,000 homes could be delivered by 2036, much higher than the social rent numbers we have seen since 2011-12, though a lot lower than in the mid-1990s. 'But that would mean building 50,000 fewer affordable homes overall in the next decade. 'To reach 300,000 homes for social rent (the number of affordable homes the SAHP currently aims to deliver), we estimate that another £800 million would be needed each year over the programme's 10-year lifespan.' It added: 'As social rent homes need more upfront subsidy than other 'affordable' tenures, building more social rent units means spending more or delivering less.' The think tank said the shortfall could be offset by allowing more homes to be built for 'affordable rent', which sees tenants pay around 80 per cent of the local market rate, as well as utilising the new National Housing Bank's £2.5billion low-interest loan facility for housing associations. The report said this would allow the new PM 'to boost the number of social rent homes built and increase the total number of affordable homes over the rest of the Parliament'. 'But this is still a far cry from the 'biggest council house building programme since the post-war period' that Burnham has promised,' it added. 'That would require significantly more money, especially if local authorities that currently build just 2,000 homes a year are to be at the helm.' Hannah Aldridge, senior research and policy analyst at the Resolution Foundation, said: 'Andy Burnham has put boosting affordable housing centre stage and with 134,000 families in temporary accommodation in England and 1.3million on the housing waiting list, this ambition is welcome and necessary. 'The Government will need to strike a balance between affordability for tenants and building at scale. 'By making careful use of the Social and Affordable Homes Programme, private developer contributions and the National Housing Bank, the new Government can boost the supply of social rent housing and build more affordable housing overall.' Mr Burnham has brought back Angela Rayner as Housing Secretary, following her 10 months out of the role in the wake of her resignation over a tax row. She said on Thursday that she aspires to 'ramp it up' when it comes to council house building - although Ms Rayner declined to put a figure on how many more would be built and by when. She acknowledged the 'massive difference' in housebuilding in the period after the Second World War compared with now, telling BBC 5 Live: 'There is a huge gulf between that. We want to aspire to get as far as possible. 'And what we've done as a Government is put more investment in that, the £39billion for social and affordable housing grant funding that we want to get out the door. 'We want make sure that the right-to-buy receipts is allowing councils – under previous governments, councils have not had the facility to be able to build at that type of scale, so we're scaling that up and we're going to support them in doing that.'