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Welsh Government to transfer HRA borrowing capacity between councils

The Welsh Government is in talks with councils to move unused borrowing capacity around the sector in a bid to boost local authority housebuilding.

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Welsh Government housing minister Rebecca Evans (picture: SWNS)
Welsh Government housing minister Rebecca Evans (picture: SWNS)
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Welsh Government housing minister reveals plan to boost council housebuilding #ukhousing

Housing and regeneration minister Rebecca Evans revealed the discussions in an exclusive interview with Inside Housing.

The plans would see unused Housing Revenue Account (HRA) borrowing capacity transferred from councils with no intention to build, to those at their debt cap and with development aspirations.

Ms Evans said: “This is something that I’m hoping to be able to say a little bit more on in the coming weeks and it’s a piece of work that has been developing since I came into post.

“Essentially, we have a situation where some of those local authorities who are able to build are now at the top of their borrowing capacity, and they still have aspirations to build more but obviously the fact that they are at the top of their limit means they are constrained in that way.

“So I’m looking to see if we could use some of the borrowing capacity among local authorities which isn’t being used, and which there are no plans to use, to transfer that across to those local authorities who are keen to keep building.”


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She added that the Welsh Government will “look to scale up working in partnership with local authorities” to build new homes “in the coming period”.

Councils in Wales have made a return to building for the first time in decades in recent years, with Flintshire, Denbighshire, Carmarthenshire, Swansea and Cardiff all working on HRA build programmes.

Self-financing was introduced for the 11 stock-retaining Welsh local authorities in 2015, with £112m of the total £1.85bn debt limit earmarked for new build and regeneration.

A spokesperson for the Welsh Local Government Association (WLGA), which has been involved in the talks, said: “Local authorities and the WLGA are committed to working with the minister, and her officials, to maximise the delivery of new affordable homes across Wales and to reach the 20,000 additional homes target, including the delivery of significant numbers of new council homes.

“WLGA is in discussion with Welsh Government around the use of additional resources to support the achievement of our shared aims.”

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