Exeter City Council has secured government funding to build 218 new affordable homes in Exeter.

Members of the Council's Scrutiny Community committee will be told of the £4.38 million boost for city housing at a meeting last week.

The homes will be built at a number of sites across Exeter, offering a mixture of rented (180 homes) and shared ownership (38 homes).

The funding comes in the form of a transitional local authority social housing grant (TLASHG) following a City Council bid to the Housing Corporation for £5.14 million. The grant represents 80 per cent of the initial bid.

In April last year (2003), the government changed the process in which councils applied for funding for affordable housing.

Previously, councils funded affordable housing through a housing association or Registered Social Landlord (RSL). They were able to pay this money as Local Authority Social Housing Grant (LASHG) and reclaim it in full from the Housing Corporation.

LASHG was replaced with a system whereby all future grant for new affordable homes will come from a Single Capital Pot managed by the South West Regional Housing Board in partnership with the Housing Corporation.

In order to secure funds for affordable housing schemes that had already been outlined under the old system, councils had to submit their bids by 30 June 2003 for funding for schemes that had full planning consent and would be on site by 31 January 2004. With the help of its partners, the Council submitted a bid for schemes worth £5.14 million.

Provided that on-site work on all of the approved schemes can begin by the end of March 2004, the Council will not have to bear any of the direct costs of provision. This allows the capital programme money that had been held back to fund schemes that may not have been approved by the Housing Corporation, to be freed for other affordable housing schemes currently in the pipeline.

As a debt-free authority, Exeter retains its ability to fund affordable housing from its capital programme using its remaining receipts. The Council works closely with RSLs to bid for Social Housing Grant (SHG) to fund schemes in Exeter from the Single Capital Pot.

Cllr Pete Edwards, Lead Councillor for Housing and Social Inclusion, said: 'This is excellent news for the Council especially at a time when more affordable housing is needed to deal with the challenge of homelessness and a growing housing register. It will go a long way towards helping the Council achieve its strategic target of providing 200 new affordable homes per year in Exeter.'

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