Landlords apply to build schools
Housing associations in Wales could begin building schools in a bid by the Welsh Government to overcome national borrowing restrictions and raise cash for housing.
In a sector first, 11 housing associations have entered discussions with government officials to act as commercial developers by funding and building schools, which they would then lease to local authorities.
The associations intend to use income from the lease to service loans taken out to build the schools, and eventually provide income with which to fund housing development.
The scheme could also see the associations, including RCT Homes, NCT Homes and Bron Afon Community Housing, building doctors’ surgeries and health centres.
Landlords must ensure the venture meets with charitable objectives on the basis there are community benefits, local labour is used and by building in areas of high-density housing.
The plans are part of a larger Welsh Government strategy to look at ways local authorities and private partners can swell its coffers for capital projects from around £1.3 billion in 2011/12 to £1.5 billion by 2017.
The Welsh Government receives capital grant from Westminster and is unable to borrow as this power is not devolved. A commission set up by the Welsh Government to decide whether it should gain tax or borrowing powers, the Silk Commission, will publish a final report in 2014.
Gerry Holtham, former chair of the independent commission on finance for Wales, said: ‘The Welsh Government wants to see if it can get social infrastructure constructed by other people and social landlords are an obvious group.’
Nick Bennett, chief executive of Community Housing Cymru, which represents landlords across Wales, said the plans showed a desire from landlords to provide more than just bricks and mortar. ‘It’s great if you’ve got new kitchens and bathrooms going into your homes, but it doesn’t mean anything if there’s nothing else for people in the area.’
Andrew Lycett, chief executive of 10,000-home RCT Homes, said the Welsh Government’s idea fitted in with the association’s schemes to help tackle worklessness.