Strategic Housing Investment Plan guidance 2025 MHDGN 2025/01

Content of the SHIP

The SHIP should contain the following two elements:

A. a succinct narrative in PDF form, submitted as a supporting document to the SHIP table generated in the Housing and Regeneration Programmes (HARP) system, which explains the context to the SHIP including:

• a statement on alignment with the LHS demonstrating that investment priorities identified in the SHIP are consistent with what the local authority outlined in its LHS (and any subsequent updates) and how the SHIP priorities will contribute to delivery of LHS Outcomes.
• a summary of the methodology used to prioritise projects.
• a summary of housing investment priorities in terms of house size, including any identified need for larger family housing (see below) and how the local authority is addressing this.
• a summary of the use of different methods of construction in the delivery of affordable housing priorities locally (see below) and any plans within the local authority area to facilitate and support efficient delivery of projects through collaboration on (a) design/mass customisation and (b) procurement for all construction methods.
• a short summary of the local authority’s investment priorities for housing in town centres.
• a summary of the authority’s plans to purchase existing properties to bring into the affordable sector and meet immediate housing requirements, including how you will work systematically with empty homes officers to consider acquisition of privately owned long-term empty homes.
• a summary of specialist provision housing that will be delivered over the period of the SHIP. This should include information on particular priorities by size, tenure and type including information on the groups this aims to support, for example, disabled people, people leaving supported accommodation or who require supported accommodation amongst others. This section should also include summary information on the all-tenure wheelchair accessible housing target and what progress the local authority has achieved towards the delivery of this.
• details of development constraints on projects and details of how the local authority has responded to and resolved these constraints prior to the site start date.
• details on how the local authority’s own resources and other funding are supporting the delivery of affordable housing in its area, including use of ringfenced council tax revenue raised from second and empty homes.
• details of progress towards the delivery of its Affordable Housing Supply Programme across all tenures by completions.
• statement that strategic housing priorities are aligned and are consistent with Rapid Rehousing Transition Plan priorities.
• details of affordable housing projects that are aligned with action to tackle child poverty in the local authority area, including any need for housing for larger families, aligned with wider activity captured in the Local Child Poverty Action Report.
• details that duties under the Islands (Scotland) Act have been followed by the local authority where appropriate.
• details of any empty homes' services and actions to bring homes back into use.
• details of how Council Tax on Second and Empty Homes has been used to assist affordable housing including support to registered social landlords and communities to bring forward affordable housing.
• details of how Developer Contributions have been used to assist affordable housing.
• the type and level of consultation undertaken with registered social landlords communities, developers, and other stakeholders in developing the SHIP and how this has helped with the development of strategic investment priorities.
• an outline of capital works planned on Gypsy/Traveller sites and whether funding will be sought from the Scottish Government
• an outline of any housing projects where funding has been or will be sought from the Vacant and Derelict Land Investment Programme.
• details of Housing Infrastructure Fund projects where these are linked to affordable housing delivery.
• any specific requirements for key worker housing and the actions that the council or its registered social landlord partners will take forward over the period of the SHIP including reference to collaborative working to utilise the Rural Affordable Homes for Key Workers Fund.

B. All affordable housing projects recorded electronically on HARP across all tenures identified as priorities and expected to require Scottish Government funding and/or complete over the five-year period. This should:

• include rolling forward existing projects from the previous SHIP where appropriate.
• set out the funding and delivery mechanism including where funds are being sought or provided through other Scottish Government programmes.
• demonstrate that the projects and resources will be realistically delivered over the plan period, highlighting any potential risks.
• local authorities may expand the level of information within their SHIP to meet their individual requirements, or for reporting on wider issues to Committee. However, each SHIP – as a minimum – should contain the core information detailed in this guidance and be submitted on HARP with appropriate tables in the standard format and the narrative and tables should be published on the Council website.

Declared Housing Emergencies/Housing Challenges

A number of local authorities have declared either a housing emergency or a housing challenge. Each local authority has its own reasons for declaring a housing emergency in its area and will be taking actions to address.

Where appropriate, local authorities should include a summary in their SHIP of action that it has taken or plans to take to address the declared emergency / challenge. It should demonstrate how these priorities and actions are aligned with priorities and actions included in the SHIP.

Fair Work First

Fair Work First is the Scottish Government’s flagship policy for driving high quality and fair work and workforce diversity across the labour market in Scotland by applying Fair Work First criteria to grants, other funding and public contracts being awarded by and across the public sector, where it is relevant and proportionate to do so. It applies to discretionary grants awarded by and across the public sector, but not to non-discretionary funding, such as grant-in-aid funding to public bodies, or to local government general revenue funding.

All grant applicants must therefore demonstrate that they are meeting the two mandatory Fair Work First criteria, i.e. payment of the real Living Wage and provide appropriate channels for effective workers’ voice; and their commitment to meeting the remaining five desirable criteria as part of the grant application process.

Further information can be found in the Fair Work First guidance.

Equalities

Local authorities should ensure that equality is central to all housing and housing services delivery. The SHIP should draw on the findings from the local authority’s Equalities Impact Assessment (EQIA) when considering the implications flowing from the translation of strategic aims into housing priorities.

Local authorities may also have undertaken an Equalities and Human Rights Impact Assessment, Fairer Scotland Duty Impact Assessment, a Health Inequalities Impact Assessment, and a Child Rights and Wellbeing Impact Assessment – where there are any updates, these should be reflected in the SHIP.

Strategic Environmental Assessments

Local authorities will be familiar with the requirements of the Environmental Assessment (Scotland) Act 2005 and, as a ‘responsible authority’ under that Act, should determine if a Strategic Environmental Assessment is required for the SHIP.

Offsite Construction and Procurement

In line with our Housing to 2040 commitments, we undertook research to explore the advantages that may be gained by increasing the use of offsite construction (also known as MMC) in the delivery of affordable homes in Scotland. The Scottish Government has, for many years, supported offsite construction in housing through investment in projects as part of the Affordable Housing Supply Programme, with approximately 90% of all new homes delivered through the programme currently using some form of MMC. Based on the current available evidence of costs and benefits, there is no case at a national level for market intervention on the part of the Scottish Government to support one form of construction over another.

However, the research shows clear evidence of potential cost savings of up to 8% from larger minimum development sizes of around 40-50 units irrespective of construction type. There is potential for further savings if more standard typologies are used.

We will continue to support the use of MMC in affordable housing delivery, but a wider evidence base will help future decision making.

The SHIP should include details of the use of different methods of construction (for example, open panel timber frame, closed or partially closed panel timber frame, modular, not yet determined) in the delivery of affordable housing priorities locally.

The SHIP should also include details of any plans within the local authority area to facilitate and support efficient delivery of projects through collaboration on (a) design/mass customisation and (b) procurement for all construction methods.

Resource Planning Assumptions

The Scottish Government has allocated Resource Planning Assumptions for the period 2021-2022 to 2025-2026 for local authorities.

Wherever possible, a minimum slippage factor (over-programme to accommodate unforeseen slippage) of 25% should be applied on an annual basis.

Housing Infrastructure Fund

The second round of the Housing Infrastructure Fund (HIF) was launched in 2021. Where HIF projects are delivering affordable housing priorities set out in SHIPs, local authorities should provide short summary information on these.

Wheelchair Accessible Housing

The Scottish Government published guidance to support the delivery of more wheelchair accessible housing. We are aware from information provided by local authorities that work to develop all-tenure wheelchair targets is underway in areas to help inform new LHSs that are being prepared. Where a local authority is currently developing, or has yet to develop, all-tenure wheelchair targets, we encourage engagement with local authorities who have set all-tenure wheelchair targets to discuss the approach that they have taken.

National Planning Framework 4 promotes an ambitious and plan-led approach to planning for homes across all tenures and is clear that diverse needs and delivery models should be taken into account across all areas.

The spatial strategy of the Local Development Plan (LDP) must take account of the housing needs of the population of the area and LDPs should consider the potential for all types of homes across all tenures, informed by the LHS. It should make provision for accessible or adaptable homes where a requirement has been identified, including wheelchair housing and intergenerational homes, to support independent living particularly, although not exclusively, among older or disabled people.

Local Development Planning guidance includes a strong focus on evidence to support proposals and regard can be provided to LHSs. Revised Housing Land Audit: Guidance (2025) notes that the Audit can include additional information, such as on accessible/adapted provision, providing a structure for monitoring delivery across all tenures.

The SHIP should include information on:

• what the wheelchair accessible housing target is across all tenures;
• a summary of what has been delivered to date against the target; and
• the planned investment for wheelchair accessible housing over the period of the SHIP.

Affordable Rural Homes for Key Workers Fund

The Scottish Government is making available up to £25 million over the period 2023-24 to 2027-28 from the Affordable Housing Supply Programme for local authorities and registered social landlords to acquire existing permanent affordable homes for key workers where there is identified need. The Scottish Government’s six-fold classification defines accessible and remote rural areas (class 4, 5 & 6).

Local authorities should be aware that proposals for new build homes for key workers would be expected to be supported through the council’s Resource Planning Assumptions and to be included alongside other new build proposals.

The SHIP should include information on what suitable properties the local authority and/or registered social landlords have already acquired under the fund, what plans they in place to acquire homes in areas where there is identified need, including information on the development of any key worker policies undertaken by the local authority, details of how these properties will be managed, what the tenure of the homes will be and who the priority key worker groups are. We would encourage local authorities who have empty homes officers to engage with them to help unlock suitable homes for the fund.

Although the funding is available for local authorities and registered social landlords, we encourage local authorities to engage with a range of organisations in their localities including public sector employers, key agencies including Highlands and Islands Enterprise and South of Scotland Enterprise, as well as local businesses and communities to identify potential proposals for the fund and opportunities for collaboration.

Community-Led Housing

Local authorities will be aware that a Rural and Islands Housing Action Plan was published in October 2023. The plan recognises that community-led housing plays an essential role in our broader approach to delivering more affordable homes in rural and island areas. Programme for Government 2025/26 extends the Rural and Island Housing Fund to new applications to March 2028. The fund has enabled local organisations to take a more active role in meeting the housing needs of their communities, where they choose to do so, and complements existing investment in affordable housing directed through registered social landlords and local authorities.

The role of local authorities in supporting and co-ordinating affordable housing delivery across their area is key and it is important that they actively engage to support communities bring forward housing proposals. This could include engaging early on feasibility and constraints, bringing together communities and other housing providers around shared delivery priorities as well as prioritising and monitoring progress alongside other affordable housing delivery programmes.

The SHIP should include a short table summarising projects that are supported by the local authority and which have been brought forward under the Rural and Islands Housing Fund. This should include information on the number of homes, the tenure, the location of the project, and the applicant.

The SHIP should also include information summarising how the local authority is actively engaging with communities and housing providers to support the delivery of more affordable homes in rural and island communities.

Rapid Rehousing Transition Plans

With strong rights to housing already in place for people who become homeless in Scotland, it is important that there continues to be a focus on prevention. Ending rough sleeping and homelessness are national priorities for the Scottish Government as part of its drive to create a fairer Scotland.

Each local authority in Scotland has been implementing a Rapid Rehousing Transition Plan (RRTP) since April 2019. The RRTPs maximise prevention and set out the approach that each local authority will employ to minimise the time a household remains homeless and ensure that the household can access appropriate suitable accommodation as soon as possible. Funding totalling £8 million has been allocated to local authorities annually from 2019-20 over seven years to 2025-26. An additional £5 million was provided to local authorities for 2020-21 to accelerate actions in their RRTP.

RRTPs should be reflected in LHSs and be fully integrated into Health & Social Care Partnership strategic plans. They should also be included in the Housing Contribution Statement to ensure they are part of the planning framework.

Addressing inequalities should be a major aspect of the RRTP, reflecting on the work being done on prevention pathways especially for women and children fleeing domestic abuse. The Scottish Government working group’s report includes recommendations.

The SHIP should include a statement that strategic housing priorities are aligned and are consistent with RRTP priorities/outcomes and any subsequent updates to it, for example it aligns with housing supply priorities set out in the SHIP.

Gypsy/Travellers and Travelling Showpeople

The Scottish Government published Improving the lives of Scotland’s Gypsy/Travellers 2 – Action Plan 2024-2026, (GTAP2) our second joint action plan setting out steps to improve outcomes for Gypsy/Travellers in Scotland, in September 2024. This builds on progress made by the first action plan Improving the lives of Gypsy/Travellers

Nearly £15 million has been committed or spent under the Gypsy/Traveller Accommodation Fund (GTAF) between 2021-22 and 2024-25, matched by funding from local authorities, to progress projects for more and better accommodation. To build experience and skills in Gypsy/Traveller site development, the GTAF focused on demonstration projects in six council areas to establish examples of modern sites. An Interim Site Design Guide (ISDG) was published in 2021 to support this work.

GTAP2 includes a commitment by the Scottish Government to make funding for Gypsy/Traveller accommodation available alongside housing under the Affordable Housing Supply Programme from April 2026.

Funding Gypsy/Traveller Accommodation alongside housing demonstrates a long-term Scottish Government commitment to supporting Local Authorities to meet their duties in relation to Gypsy/Traveller homes and allows Local Authorities to better plan ahead. The decision was also made in line with COSLA’s views and the Verity House Agreement. 2026-27 will be a transition year which gives continuity for the remaining GTAF projects and allows progress to be made by local authorities who are developing further projects for funding. COSLA has agreed in principle to capital funding being made available through the AHSP Resource Planning Assumptions (RPAs) for 2026/27. The approach is subject to confirmation of funding and will be monitored and reviewed for future years. This will be informed by the independent evaluation of the GTAF and the ISDG, which is currently under way, as well as experience gained during 2026-27.

Alongside the changes to funding, COSLA has agreed to work in partnership with Scottish Government and ALACHO to review site standards, to ensure Gypsy/Traveller sites are of good standard and align with relevant aspects of housing standards.

The SHIP should include an outline of any capital works planned on Gypsy/Traveller sites, both new and existing, residential and transit, and whether funding will be sought from the Scottish Government. Funding will be available directly to Social Landlords, with the agreement of the Local Housing Authority. Guidance for the AHSP will apply to Gypsy/Traveller projects and this will be supplemented with specific guidance where there are different or additional requirements because of the built form, tenure or standards for Gypsy/Traveller accommodation. For year 1 local authorities will be required to work to the Interim Gypsy/Traveller Site Design Guide and meet the standards included in it.

LHS guidance re-affirms the requirement for local authorities to engage with Gypsy/Travellers, and Travelling Showpeople, to better understand their accommodation needs. As set out in the GTAP2 we plan to commission work on an Accommodation Needs Toolkit. This will have a practical focus, aimed at improving the way that Housing Needs and Demand Assessments (HNDA), Local Housing Strategies (LHS) and Development Plans reflect the needs of Gypsy/Travellers and helping Local Authorities to meet their duties under the Planning (Scotland) Act 2019 in relation to Local Development Planning and Evidence Reports.

Child Poverty (Scotland) Act 2017

The Child Poverty (Scotland) Act 2017 places a duty on local authorities, together with relevant Health Boards, to prepare and publish annual Local Child Poverty Action Reports (LCPAR) setting out what action they have taken to contribute toward reducing child poverty in the reporting year, and what action is planned in future.

‘Best Start, Bright Futures’, the Scottish Government’s second Tackling Child Poverty Delivery Plan for the period 2022-2026, makes clear the vital role that affordable housing plays in tackling child poverty. Housing forms not only the foundation for family life – as a safe place for children to grow and learn, and for families to come together – but it also one of the most significant costs which families must continue to meet on an ongoing basis. If families lose their home the effects can be devastating – and cause lasting damage to children's lives.

The Plan retains a strong focus on ensuring policies address the barriers faced by those at greatest risk of poverty, including the six priority family types identified. The family types include Black and Minority Ethnic (BME) families who are overrepresented in the private rented sector, households with a disabled family member who may require more accessible homes, and families with three or more children who will require larger homes. The SHIP should outline how strategic investment priorities will address the needs of low-income families in the area, including the specific barriers and challenges faced by family types at greatest risk of poverty.

Best Start, Bright Futures notes that ‘we will place the prioritisation of tackling child poverty at the heart of the Affordable Housing Supply Programme through further strengthening our housing planning processes to strengthen the focus on housing needs by size and location to ensure that larger family homes are delivered where they are required, including through the targeted purchase of appropriate ‘off the shelf’ properties’. On this basis local authorities should ensure that the SHIP reflects any need identified in LHSs and any subsequent refresh of these. The SHIP is also expected to draw on wider knowledge and evidence developed locally as part of the LCPAR, helping to enable access to warm and affordable housing for families living on low incomes.

The SHIP should consider what progress has been achieved, identify where gaps exist, and align with strategic housing priorities. Where there are any updates, the SHIP should include these. Key progress delivered as a result of the SHIP for low-income families should be captured within the relevant LCPAR.

Islands (Scotland) Act 2018

The Islands (Scotland) Act 2018 introduces measures to support and help meet the unique needs of Scotland's islands now and in the future. It also seeks to help create the right environment for sustainable growth and empowered communities. The LHS guidance sets out that an LHS for a local authority area that includes island communities should ensure that the duties are supported and, where there are any updates, these should be reflected in the SHIP.

Council tax income for affordable housing

The combined revenue raised from council tax on second and long-term empty homes is either ring-fenced or its use may be determined by local authorities:

• Ring-fenced - revenue raised from reducing the discount from 50% to 10%, which is ring-fenced for affordable housing and empty homes services.
• Local authorities allocate according to local needs - revenue raised from the point the discount is under 10% (including up to 100% increase (double the full rate)). While this revenue is not ring-fenced for affordable housing and empty homes services, local authorities are encouraged to use part or all for this purpose.

The SHIP should set out local authorities’ plans for using the revenue ring-fenced for affordable housing and empty homes services. The revenue figures in the SHIP should correspond with those entered into council tax local financial returns (LFR 12), which are published annually for financial years. The plans for using this ringfenced revenue should include how many affordable housing units will be (or have been) provided, by financial year for the last 3 years (including the year for the SHIP) and/or the use of revenue for empty homes services.

LFR 12 returns indicate ring-fenced carry forward balances/reserves. At the end of 2023-24, the amount of ring-fenced revenue in reserve across all authorities was £74,997,000. Local authorities should therefore also explain in the SHIP when and what they intend to use this carry forward for, stating how many units will contribute towards Affordable Housing Supply Programme projects where known.

Second Homes

Second homes can benefit local communities if they are used to provide private rental homes. Second homes used as short-term lets may also support local economies but they may restrict the availability of housing and increase costs for people who want to rent or buy. If local authorities have identified the concentration of second homes as a concern in their LHS, they should explain in their SHIP their policy for council tax charges on second homes (including if they are using powers available to apply an increase of 100%).

Empty Homes

At a time of great housing pressure, every home matters. Homes remaining empty are a wasted resource that could be brought back into use as warm, safe housing that meets peoples’ needs. Local authorities should use the SHIP to set out their investment plans for empty homes services, for example funding empty homes officer posts.

Local authorities are encouraged to develop Empty Homes Strategies using the Empty Homes Framework (which was co-produced by the Scottish Empty Homes Partnership and local authorities). Local authorities should refer to their Empty Homes Strategy in their LHS and SHIP, to explain local priorities and the actions they are taking to address them.

The SHIP should provide a summary of existing empty homes services and any initiatives, such as local grant/loans. Details of future investments to help more owners bring their homes back into use should also be included. The SHIP should state how these are funded, for example, whether ring-fenced council tax revenue has been used. The SHIP should also set out an overview of the numbers of long-term empty homes brought back into use over the last three financial years detailing for each year:

• the amount and source of funding and routes used (for example, AHSP acquisitions such as buy backs or open market purchases)
• the length of time the homes have been empty
• <6 months empty
• 6-12 months empty
• >1-2 years empty
• >2-5 years empty
• >5-10 years empty
• >10 years empty

Developer Contributions

A SHIP should capture details on any updates to contributions from developers through Affordable Housing Policies, including planning obligations or conditions which have contributed to affordable housing delivery. They should include details of the scale of land and funding contributions the authority has in hand from previous years, how much has been used, and what is left to carry forward into future years.

Where contributions (land or commuted sums) have been used to directly provide affordable housing, local authorities should provide details in the text of how many units have been provided (differentiating between those that have and have not contributed towards Affordable Housing Supply Programme projects), the type of contribution and, where appropriate, the level of commuted sums used by financial year.

Consultation and Collaboration

Local authorities should engage with stakeholders including housing, planning, economic development, health, social work, and other departments, registered social landlords, communities and developers to help inform the development of the SHIP, engagement with the third sector and people with lived experience should also be encouraged. The SHIP narrative should include information on the level and type of consultation undertaken with all stakeholders and explain how this has helped inform any revision/changes to SHIP priorities.