Barratt homes in on 'social' project

BRITAIN'S largest housebuilder wants to overhaul the way the Government plans homes for teachers and nurses to save up to £500m a year from the social housing budget.

Barratt chief executive David Pretty wants to change the system where builders put up homes for housing associations - local government quangos with about £1.5bn of taxpayers' money to spend each year - who then rent them to those workers. Few of those homes are currently designated for key workers.

Pretty is calling for developers to be able to sell a big propertion of homes directly to them at a discount of up to 30%.

Any saving from Barratt's scheme could be used for building more social housing for the unemployed and those in abject poverty who may never have any hope of getting on the housing ladder, Pretty added.

Barratt's initiative would run in parallel to Chancellor Gordon Brown's offer made over the weekend to help 110,000 potential first-time buyers on to the housing ladder with a £1bn State-backed shared-equity scheme.

A green light for Pretty's proposal could mean Barratt selling two-bedroom flats in the London suburbs for £113,000 compared with an average of £150,000 at current market rates to 'teachers, medics and social workers', Pretty told the Evening Standard.

'This will not cost the Government as it does not require funding. It potentially could save a half a billion pounds a year if a third of their current social housing need was aimed at key workers,' he said.

Extra key-worker sales would boost Barratt's home sales. Overall they were up in its half-year to 31 December with surging social housing sales compensating for an 8% fall in private sales at 5,610 homes. More Government spending would boost further the builder's social housing unit sales. Barratt is on course to sell 2,000 social housing units for the year to the end of June, up from 1,300 last year, Pretty said.

A Government-commissioned report into the housing market last year called for social housing new builds to rise from 20,000 a year to 30,000.