Chamber
Meeting of the Parliament 22 January 2013
22 Jan 2013 · S4 · Meeting of the Parliament
Item of business
Budget (Scotland) (No 2) Bill: Stage 1
I am sorry, but I have taken one intervention and do not have time to take another.
Although the draft budget goes a little way to improving the situation, the cuts to housing still remain higher than average.
The budget could also be devastating to housing associations, which are already struggling to fund new projects due to the cuts to the current housing association grant from £70,000 to £40,000 a unit. Many housing associations have argued that that level of HAG funding is unsustainable. It is all very well to say, as Alex Neil did last year, that housing associations should spend their reserves, but they can do that only once.
I agree with the Infrastructure and Capital Investment Committee, which called on the Scottish Government to review the HAG level and set out alternatives so that housing associations do not fall below planned development levels, which would jeopardise their sustainability.
According to the Scottish Federation of Housing Associations, small housing associations or those in rural areas simply cannot afford to develop with the lower grant levels. It is more costly to build in rural areas, and the cost of loans is more expensive for smaller associations because lenders are less willing to lend or the rates are prohibitive. That means that, in the vast majority of cases, development just stops, which leads in turn to a shortfall in housing stock in the areas that need it most.
With councils being cash strapped, cuts being made to HAG and lenders being risk averse, it is hard to see how we will achieve affordable housing building targets. However, according to Government figures, in the first year of the affordable housing programme, the target of 6,000 was exceeded by 800. That could be because the data is being presented differently.
Shelter notes:
“overall the number of starts has fallen from 4,800 in 2010-11 to 3,366 in 2011-12. Given the lag time in all that, I think that we are heading for a cliff edge with regard to new completions in the next few years.”
We need to be confident that we have the exact figures, so we need more transparency in the way that the figures and the associated data are collected, counted and presented. We need sufficient breakdowns of starts, completions and their timings to ensure that there is no double counting.
I could say much more on the travesty of cutting the housing budget so severely. We need a housing budget that is more sustainable, will stimulate the economy through the construction industry and will provide much-needed apprenticeships for young people, for which the industry is crying out.
We need to review HAG funding so that housing associations can build homes for those who are most in need where they are needed. We need to build houses, particularly to address the mismatch of housing that councils and housing associations face. We need to extend the retrofit programme to make houses more efficient and reduce fuel poverty.
This budget, which cuts the housing budget by higher than average, will not do that.
16:29
Although the draft budget goes a little way to improving the situation, the cuts to housing still remain higher than average.
The budget could also be devastating to housing associations, which are already struggling to fund new projects due to the cuts to the current housing association grant from £70,000 to £40,000 a unit. Many housing associations have argued that that level of HAG funding is unsustainable. It is all very well to say, as Alex Neil did last year, that housing associations should spend their reserves, but they can do that only once.
I agree with the Infrastructure and Capital Investment Committee, which called on the Scottish Government to review the HAG level and set out alternatives so that housing associations do not fall below planned development levels, which would jeopardise their sustainability.
According to the Scottish Federation of Housing Associations, small housing associations or those in rural areas simply cannot afford to develop with the lower grant levels. It is more costly to build in rural areas, and the cost of loans is more expensive for smaller associations because lenders are less willing to lend or the rates are prohibitive. That means that, in the vast majority of cases, development just stops, which leads in turn to a shortfall in housing stock in the areas that need it most.
With councils being cash strapped, cuts being made to HAG and lenders being risk averse, it is hard to see how we will achieve affordable housing building targets. However, according to Government figures, in the first year of the affordable housing programme, the target of 6,000 was exceeded by 800. That could be because the data is being presented differently.
Shelter notes:
“overall the number of starts has fallen from 4,800 in 2010-11 to 3,366 in 2011-12. Given the lag time in all that, I think that we are heading for a cliff edge with regard to new completions in the next few years.”
We need to be confident that we have the exact figures, so we need more transparency in the way that the figures and the associated data are collected, counted and presented. We need sufficient breakdowns of starts, completions and their timings to ensure that there is no double counting.
I could say much more on the travesty of cutting the housing budget so severely. We need a housing budget that is more sustainable, will stimulate the economy through the construction industry and will provide much-needed apprenticeships for young people, for which the industry is crying out.
We need to review HAG funding so that housing associations can build homes for those who are most in need where they are needed. We need to build houses, particularly to address the mismatch of housing that councils and housing associations face. We need to extend the retrofit programme to make houses more efficient and reduce fuel poverty.
This budget, which cuts the housing budget by higher than average, will not do that.
16:29
In the same item of business
The Deputy Presiding Officer (John Scott)
Con
The next item of business is a debate on motion S4M-05407, in the name of John Swinney, on the Budget (Scotland) (No 2) Bill. We are pretty tight for time, s...
The Cabinet Secretary for Finance, Employment and Sustainable Growth (John Swinney)
SNP
Last week, I introduced the Budget (Scotland) (No 2) Bill for 2013-14, which will give effect to the draft budget that I set out in September last year.I tha...
James Kelly (Rutherglen) (Lab)
Lab
Does the cabinet secretary accept that there are 80,000 fewer college places this year?
John Swinney
SNP
I accept that the Government has done two things. First, we have—as we said we would—maintained student numbers at colleges at 2011-12 levels. Secondly, we h...
Willie Rennie (Mid Scotland and Fife) (LD)
LD
The finance secretary told the Finance Committee that his mid-year estimate for business rates income is about £90 million higher than he had budgeted for. C...
John Swinney
SNP
I have no additional information to share with Parliament on that matter. I remain confident that the assessments of non-domestic rates that I made and appli...
Gavin Brown (Lothian) (Con)
Con
Scottish Enterprise will transfer £99 million from resource to capital, instead of £200 million. Is that bad news for the economy, given the figures that the...
John Swinney
SNP
I set out to Parliament that we would transfer approximately £200 million from resource to capital in 2012-13 and £240 million in total in 2013-14. The Gover...
Ken Macintosh (Eastwood) (Lab)
Lab
Why has the cabinet secretary’s NPD programme, through the Scottish Futures Trust, been cut by more than £300 million in successive years?
John Swinney
SNP
That is complete nonsense. I have just told Parliament that there is investment of £2.5 billion in the non-profit-distributing pipeline of infrastructure pro...
Gavin Brown
Con
Will the cabinet secretary give way?
John Swinney
SNP
Mr Brown will forgive me; I need to cover some more ground.The investment will not only increase the supply of social and affordable housing, but will suppor...
Ken Macintosh (Eastwood) (Lab)
Lab
It seems that each time I speak in a debate with Mr Swinney, I begin by acknowledging that there is—on the face of it, at least—more that unites us than divi...
Bruce Crawford (Stirling) (SNP)
SNP
Ken Macintosh identified some areas in which Labour would make cuts, but in her cuts commission speech Johann Lamont said that there was a great reward for t...
Ken Macintosh
Lab
I identified areas in which the Scottish people would be delighted to see the Scottish Government make cuts, which included the trips to the Ryder cup, and s...
John Swinney
SNP
I am grateful to Mr Macintosh and would like him to give us a little more detail on his proposal to allocate all £331 million of the capital consequentials t...
Ken Macintosh
Lab
It would mean nothing of the sort. Laughter. If the cabinet secretary had listened—Interruption. The cabinet secretary might be in denial about the cuts that...
The Deputy Presiding Officer
Con
Order.
Ken Macintosh
Lab
Just to be quite clear for members, I say that these spending priorities are the ones that Mr Swinney outlined in the commitments that he made in December to...
The Deputy Presiding Officer
Con
You must draw to a close, please.
Ken Macintosh
Lab
If Mr Swinney’s only crime was to be found guilty of making exaggerated claims, our reaction might simply be disapproval. However, the more serious charges a...
Gavin Brown (Lothian) (Con)
Con
Let me begin in the spirit of consensus by agreeing with something that the cabinet secretary said in his opening speech. When he was intervened on by Ken Ma...
John Mason (Glasgow Shettleston) (SNP)
SNP
Does Gavin Brown accept that although lots of people have suggested how we could spend extra money, not many people have suggested how we could spend the pre...
Gavin Brown
Con
If Mr Mason had looked at Conservative proposals at the most recent election and since, he would see that we have suggested the mutualisation of Scottish Wat...
Kenneth Gibson (Cunninghame North) (SNP)
SNP
I am no Mystic Meg but, following the entirely predictable tone that we heard in the speeches of Kenneth Macintosh and Gavin Brown, I do not need a crystal b...
Kenneth Gibson
SNP
On cue.
Ken Macintosh
Lab
I am glad that Mr Gibson hangs on my every word.Mr Gibson said that there would be no chance of Labour supporting the SNP, this year or any other year. Does ...
Kenneth Gibson
SNP
The reality is that those demands are not designed to be met. They are designed for public consumption. Mr Macintosh is deceiving the people of Scotland if h...
Gavin Brown
Con
It is awful that Mr Gibson might have been misquoted. I therefore give him the chance to correct the Official Report: is he impressed by the rate of progress...
Kenneth Gibson
SNP
Mr Brown has gone out of his way to avoid the fact that £300 million has been switched from the NPD programme to the regulatory asset base for the Borders ra...