Councils calls for debt relief to aid building work
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The councillor in charge of housing in the Highlands has travelled to Westminster to plead for relief from the council’s housing debt burden.
Councillor Margaret Davidson, chair of Highland’s housing and social work committee, met with Ian Pearson, economic secretary to the Treasury.
The council is currently spending £15 million each year on loan charges to service its £146 million housing debt, which equals more than £10,000 per home. 37p out of every £1 of rent is siphoned off for loan charges.
The council warned in January that its huge debt burden had forced it to abandon its plans to start building homes again.
Highland Council wants the UK government to be more flexible in its rules about housing debt. Currently, the only way to get debt written off is through the transfer of homes to housing associations, a move which was rejected by Highland tenants three years ago.
The Scottish Government’s finance secretary John Swinney wrote to the Treasury at the end of 2007 asking for alternatives to stock transfer as a means of getting housing debt written off. The Treasury refused to bend the rules. But Ms Davidson described the meeting with the Mr Pearson as ‘very positive’, adding that the door had been kept open for further talks.
She said: ‘If the council did not have to pay the current loan charges of £15 million per year, this could be reinvested in housing capital contracts, either for refurbishment of existing houses, or new build.’
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