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LABOUR HIT OUT AT HOUSING FUNDING GAP

Councillor Jeff Leaver, the Labour’s Housing spokesperson on the Council, has hit out at the Scottish Government for not providing enough money to cover a newly disclosed £8 million funding gap in the Council’s housing plans This funding gap was revealed in a report to today’s (Tuesday 10 September) Housing sub-Committee meeting

New guidance issued by the Scottish Government in July increased the level of grant available for new affordable homes from £43,000 per unit to £59,000 per unit.  While this will help with the development of new social rented housing, the increase in subsidy places considerable additional strain on the Council’s housing budget as the Government has failed to fund this increase in the subsidy.

Councillor Leaver said

“The Scottish Government looks as if it doesn’t  know what it intends to do with regard to building affordable housing. In 2011, it slashed the subsidy level from around £70,000 per unit to around £40,000. Following complaints from Registered Social Landlords that this rate of subsidy was not sustainable, it set up a Working Group to look into this crisis . As a result, it has now decided to increase the subsidy to £59,000 but has failed to come forward with sufficient additional funding to cover the increase. While Dumfries and Galloway will receive an extra £1.6 million,  the pre-existing funding gap has now increased by £8 million pounds. In order to cover this gap, house building projects proposed for Gretna and Johnstonebridge have had to be put on hold in the hope that additional funding can be found over the next few years.

“The report suggests that on-going dialogue with the Scottish Government may be able to find new ways to plug this gap. However, I am very concerned that if the Government weren’t able to identify funds to pay for this change in subsidy to begin with, why would they do so after additional talks. With thousands of people on the waiting list for housing in Dumfries and Galloway and with house building still being severely hit by the recession, the Government really needs to come forward with a sensible, consistent strategy for funding for housing."

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