Grant to private firms must be handled with care

I happen to believe that right now we have the greatest chance in at least a decade to make a serious difference to the provision of affordable housing in this country. But where to start in a rapidly changing landscape, where the rules to some extent are being made up as we go along?

Well, how about social housing grant for non-registered social landlords? This is a controversial question – big numbers, strong, polarised views, no precedents to look at and hugely varied expectations.

Just about the only given is that grant for non-RSLs is going to be on the statute book sooner rather than later. The government intends to set aside several hundred million pounds of approved development programme cash to finance it.

By any standards this is a great deal of cash for something that remains unproven in terms of delivering value for money. There is clearly an expectation from government that RSLs – no doubt inhibited by the heavy hand of the Housing Corporation – are not cost-effective, that the private sector can produce better solutions. The question is, how can such comparisons be made? Will the public purse benefit?

We have to be clear that procuring housing is not usually a simple one-off transaction. The government's whole sustainability agenda is about the long term and the delivery of communities, not units.

Of course, cost-effective procurement of the housing supply is essential, but it is only part of the picture. I am sure the corporation will be looking at potential new suppliers in the context of how they can deliver genuine sustainability, meet the needs of diverse communities, deal with homelessness and address the myriad other issues at risk of being shunted into the "too hard" pile. I very much hope that we might start to see some useful new thinking as well.

We do not want to see the easy bits being creamed off by the private sector with less attractive areas left to good old housing associations

Some social landlords welcome the competition. If there is something to learn from the process, we can all benefit. But we do not want to see the easy bits of housing provision being creamed off by the private sector, with less attractive areas left to good old housing associations.

There have been suggestions from some private developers that they would like to be able to vet tenants, to weed out the more difficult households – fine, but that hardly sounds like a contribution to sustainable communities to me. On the other hand, if there are new ways of procuring or financing affordable homes that do not depend on picking and choosing tenants, the sooner we all learn about them the better.

For the corporation as for everyone else, there are still more questions than answers. Some of these questions are practical: for example, will private developers be able to access the online investment management system? Others are absolutely fundamental – how will we be able to secure long-term benefits without going down the potentially complex path of PFI-style agreements? Social landlords, partly because they are regulated and partly because of their ethos, have shown themselves ready to embrace new policies and pressures. How are we going to reflect this in contracts struck before houses are even built?

The key principles have to be securing value for money and the ability to make meaningful comparisons between different offerings from social landlords and private companies. Judging by RSL bids so far for our new investment approach, we are going to be spoilt for choice when allocating funds.