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Meeting of the Parliament 06 October 2011

06 Oct 2011 · S4 · Meeting of the Parliament

Item of business

Housing

Macdonald, Lewis Lab North East Scotland Watch on SPTV

That intervention goes to the nub of the argument. It is one thing to say, “We are providing funding to build new houses,” but, if the provision of that funding shifts the balance away from houses that people on low incomes can afford to houses at mid-market rent, it will not achieve the objective that the SNP set out in its manifesto.

Nevertheless, I am happy to welcome the progress that has been made. As we have heard this morning, Mr Brown has moved on from the position he outlined in his 30 June letter to me, in which he refused to set a social rented housing target. On 22 September, the day after a spending review that was heavily criticised for its cuts to housing, he finally promised at a housing conference that

“at least two-thirds of these homes”—

the 30,000 affordable homes planned for the next five years—

“will be for social rent”.

That is good. It means that there will be at least 20,000 social rented homes. It is a big step forward from the lack of a social rented target that had been made apparent only a few weeks before and represents a clear acceptance from the minister that affordable homes are not the same as houses for social rent. However, there is still some way to go.

I guess that, tiresome though it may be, we will have to keep on reminding the SNP of its election promise. If we have succeeded in persuading ministers to increase their social housing ambitions from having no specific target at the end of June to having a target of 20,000 social rented homes at the end of September, we might even get them to endorse their manifesto in time for Christmas.

Of course, it will not be impossible for ministers to do so. As Malcolm Chisholm pointed out, they have to address the balance between different types of affordable housing in their current plans. They also have to listen to the views of those who are willing and able to build houses that are genuinely affordable for people on low incomes and ensure that there is adequate funding support to allow those developments to happen. Mr Neil and Mr Brown might need to have a word with Mr Swinney about his pledge of £500 million for preventative spending and explain to him just how preventative spending on new social housing can be. They might want to ask him about the consequentials from spending elsewhere that might be available to the Scottish Government and which were not accounted for in the spending review announcement of 21 September. Finally, they might want to explore the scope for adjusting Government priorities as the budget bill makes its way through Parliament in the months ahead. If they do not do so, the Scottish Government’s ability to deliver against any of its targets will remain uncertain as long as the available funding falls so far short of what is required.

That is not just an Opposition view; it is also the view of the housing sector. According to the Scottish Federation of Housing Associations,

“The most serious issue facing housing associations and co-operatives is that the overall budget for housing supply is falling steeply”

and an “austere grant rate” of £40,000 per unit for housing associations

“will not fund affordable rented housing, while keeping rents genuinely affordable to low income households”.

In other words, housing associations can build with that level of subsidy—indeed, we have seen as much—but only by borrowing larger sums per house, which will in turn require rental incomes that will price the poorest families out of the sector.

Shelter has also asked why the sector is apparently being punished for being willing and able to deliver homes at reduced levels of subsidy. If delivering more output for less input were indeed valued by ministers, one might have expected an increase rather than a cut.

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Meeting of the Parliament 06 October 2011

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