The Homes and Communities Agency (HCA) has published on-line guidance of how developers and local authorities can bid for two elements of the additional £635 million housing funding package announced in April's Budget.

A total of £400 million of the package has been put in to the Kickstart Housing Delivery Programme (KHD) to unlock sites that have stalled, but where development could proceed immediately. The HCA would offer a contribution to infrastructure or development costs - complemented by support for affordable housing and HomeBuy Direct - for high quality housing projects that provide a mix of tenures. The initiative is expected to deliver up to 9,000 new homes.

As part of the funding criteria, only schemes that start on site within the financial year 2009/10 will be eligible. Funding will be available to a range of organisations including housing associations and private sector developers. The HCA will seek to recover its investment and to share in any uplift in values if and when the market improves. Bids will be accepted up until 8 June 2009 with the announcement of bidders who are successful at this expressions of interest stage in late July.

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Commenting on the KHD, Sir Bob Kerslake, Chief Executive of the HCA, said that the additional funding was an essential boost to the supply of new homes.

"This funding is in addition to our existing national affordable housing programme and will be an important 'transfusion' into schemes that have potential to be brought back to life. We will be very selective about the schemes that are eligible. Criteria relating to quality, speed of delivery and meeting local needs will be crucial in attracting funding," he said.

Local authorities can also bid for a slice of £100 million of extra funding to deliver new council homes for social rent. The money is broadly a 50:50 split of £50 million in the form of social housing grant, with the remaining £50 million set aside as (capital) cover for the 'prudential borrowing'. Ministers have made it clear that any homes built under the scheme will be eligible for exclusion from the HRA (Housing Revenue Account) subsidy system. Exclusions will be subject to individual agreements between the Secretary of State and each local authority.

(CD/JM)