Efficiency scheme axed to save mortgage rescue
The Welsh government dropped a pledge to help first-time buyers make their homes more energy efficient in favour of its mortgage rescue scheme.
Ministers shifted £500,000 from the energy efficiency pilot, which had been designed to help all first-time buyers except those purchasing new build properties or homes through right to buy.
The move was revealed by housing minister Joceyln Davies in a written answer to a question submitted by Welsh Liberal Democrat housing spokesman Peter Black.
She states: ‘Budget Expenditure Line 1004 [Financial Assistance for First Time Buyers] provided help for first time buyers with the cost of energy efficiency in their homes.
‘A fall in demand for the grant, coupled with the changing economic position, resulted in this budget being diverted to the Mortgage Rescue Scheme in 2010/11.
‘This decision was taken with the agreement of the Welsh Local Government Association.’
Mr Black said the money had always been ‘badly targeted’ and ‘would not [have] helped a single person onto the property ladder’.
He added: ‘I welcome the fact that the money has now gone to help people avoid repossession and homelessness, but even the mortgage rescue scheme is in difficulty because of the overly restrictive criteria that applies to it.
‘Given the current problems with the economy and the growing shortage of affordable houses to rent, the Welsh government needs to address this shortfall or else we will see a dramatic growth in homeless applications and families living in temporary accommodation.’
In June, the Welsh assembly announced it was transferring £2 million from building extra care homes for older people to the mortgage rescue scheme.
The month before it had suspended the scheme due lack of funds.
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Readers' comments (7)
Outside Housing | 31/08/2010 5:02 pm
"the Welsh government needs to address this shortfall or else we will see a dramatic growth in homeless applications and families living in temporary accommodation."
The government, Welsh or otherwise, shouldn't still be thinking of families going into temporary accommodation as a default, that's ancient mentality. It's about planning ahead and not just Housing and Social Services departments working together, but in tandem with banks.
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Sidney Webb | 31/08/2010 5:22 pm
Whatever you do don't tell The DM Tendency about this subsidy previously available to owners as they will be so upset that housing other than social housing has government money paid on it.
Outside Housing - I know that the housing crisis is getting worse, and also that since the banks were nationalised we now own them, but I don't think we will get away with putting the Welsh Homeless on deposit - the boxes are not big enough for a start. Nice thought though, but until houses are built then temporary accomodation is all that there is - even though that will mean paying over huge amounts of tax payers money to private landlords.
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Anonymous | 01/09/2010 9:59 am
A sensible and pragmatic decision. People who are on low wages or increasingly with no wages need to be helped to keep a roof over their heads. The majority of people don't choose to be in this position. It is our economic system that has forced them into the position of not being able to earn enough to pay for a home. It is therefore only right that the economic system redistributes some of money from those who gain from low wages (the employers and the rich) to those who suffer. And it is also far more equitable, fairer and decent that we pay the mortgage of the occupier rather than the mortgage of the landlord (which is what HB does in the private sector). Of course, we wouldn't be in this position if enough homes were built at affordable prices and with a tenure pattern that offered security and stability (i.e. owner occupiedor social rented) and we stopped exporting jobs (for example, housing associations buying British productsand vehicles - although maybe they are just following the lead set by Cameron who couldn't even be bothered to buy a British made car before he was prime minister?)
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Outside Housing | 01/09/2010 10:35 am
PSR
I'm guessing you did really understand my point didn't you?
Council's and Banks should have some communication other than confirming they are about to repossess, which is about as far as it usually goes. And that communication process should end with the bank not repossessing (at least not as quickly) while the local authority gets something in place that is not temporary accommodation.
If anyone thinks that is unrealistic then you don't dream big enough.
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Sidney Webb | 01/09/2010 11:22 am
Sorry - did understand your point, I've just got a weird humour sometimes.
There is existing liaison, but the primary link is the person otherwise data protection issues are a barrier. A bank, however caring, must put financial interest ahead in these circumstances. They will not defer whilst waiting for a local authority to come up with a new home, even if the people manage to not be seen as intentionally homeless.
Alpha, elsewhere, indicated a preference for totally flexible tenure. This would assist in these circumstances allowing the person to switch from mortgage to rent, and so stay in their home. Funding would need to be provided for this though, as it would with any housing proposal. I believe that such funding would be a far better use of money than clearing up the mess of homelessness, and more likely to provide a return.
Maybe if enough of us dream then the real solutions can be implemented.
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Outside Housing | 01/09/2010 11:43 am
Thanks for allowing yourself to dream PSR!
The Data Protection issues can be easily overcome by the homeowner giving authority to both parties, which I'm guessing they would.
PS I wasn't imagining any bank would have "caring" in its armoury. I was thinking of them being made to assist by the government. That's not radical is it?
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Sidney Webb | 01/09/2010 12:26 pm
In our current society it sometimes feels that even acknowledging that other people exist is radical. Joined up action is definately more likely to bring solutions than deregulation and abdication of responsibility.
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