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Housing subsidies increased by £14,000 in Scotland

Words: Laura Edgar
Rent / iStock

The Scottish Government has announced it is increasing housing subsidies for affordable homes for rent being delivered by councils and registered social landlords (RSLs) over the next three years.

The Scottish Federation of Housing Associations (SFHA) and Glasgow and West of Scotland Forum of Housing Associations have welcomed the announcement.

The subsidies aim to help councils and RSLs acquire land or buildings and to build, convert or improve housing for social and affordable rent.

Recommendations to increase subsidies were made by a Subsidy Working Group comprising housing associations and council representatives. These measures have been agreed in full and will be implemented for all new grant applications.

Grant subsidies have been increased by up to £14,000 for each new home with incentives being offered for those homes achieving the high greener standard, the Scottish Government said.

This means the subsidy will go up from £58,000 to £70,000 for RSLs in city and urban areas while council homes will go up from £46,000 to £57,000.

Housing minister Margaret Burgess expressed the Scottish Government’s support for the recommendations.

She said: “Housing is at the heart of our ambitions to create a fairer and prosperous country and councils and registered social landlords will play a critical role in realising that.”

Referring to the Scottish Government’s target of delivering 50,000 affordable homes, Burgess continued: “The new target is a 67 per cent increase in affordable housing supply, with 70 per cent of the new target being for social rent.”

Mary Taylor, chief executive of the SFHA, said the announcement is “long-awaited”.

“As research showed last October, new affordable homes are urgently needed and these measures will go towards helping the sector to meet housing need. It can take a long time to get houses ready for occupation, and this clarity about investment rates will allow our members to plan ahead. Crucially, the increase will also ensure that the homes are affordable to those working in low paid jobs and on low incomes.”

However, Taylor said the federation is aware that other factors impact on the sector’s ability to deliver increased numbers of affordable housing – “planning, infrastructure and availability of affordable land”.

“We will continue to work with the Scottish Government, the housing association sector, local authorities and other partners to find solutions to these challenges,” she concluded.

Peter Howden, chair of the GWSF, said: “Keeping rents genuinely affordable to people in low paid work remains a top priority for community controlled housing associations, and the new grant rates give us a fighting chance of making a significant contribution to the overall programme with high quality new homes which help regenerate our communities. The new rates, alongside the pledge to greatly increase the supply of social and affordable housing, show that at a difficult financial time, housing is a very high priority for ministers.

However, Howden expressed disappointment that for 2016/17 at least, it hasn’t been possible to “implement the recommendation on a small, separate fund for environmental and place-making works as such funding can make a real difference in enabling regeneration projects to go ahead”.

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