UK government abandons plan to swap on-site affordable homes for cash payments

Ministers announced they will not proceed with a plan to allow private developers to meet affordable-housing requirements through cash payments rather than building units on medium-size sites. The proposal, part of a 150-page planning reform package, targeted developments of 10 to 49 houses and was championed by the Treasury under Rachel Reeves to accelerate housebuilding toward a 1.5 million-home target. Experts from the National Housing Federation warned the change could eliminate tens of thousands of affordable homes, especially in rural areas where over half of such homes are built on medium sites.

Consultation results showed 41% of participants strongly opposed the measure compared with 18% in strong favour, prompting the government to reverse course. Kate Henderson of the NHF praised the decision as a safeguard for social housing across the country. While this specific reform was dropped, the housing secretary, Angela Rayner, outlined other steps to speed planning for projects near well-connected transport hubs.