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Cash to support construction
27/11/2008
Decisive action to help the construction industry tackle current economic challenges was pledged today.
Deputy First Minister Nicola Sturgeon revealed that accelerated investment of £9 million will finance a string of housing developments across Scotland.
The funding will allow housing associations to purchase unsold stock from the private sector, increasing the availability of much needed affordable housing.
First Minister Alex Salmond announced in August that delivery of affordable homes will be accelerated, bringing forward up to £100 million of spending through the £1.5 billion Affordable Housing Investment Programme.
In October, Communities Minister Stewart Maxwell confirmed the first tranche of funding - £9 million - would be accelerated to fund site starts and land acquisition.
Today, announcing £9 million, the second tranche of funding, Nicola Sturgeon said:
"The Scottish Government is under no illusion about the serious challenges facing Scotland's house builders.
"We are taking decisive action, within our powers, to help alleviate the brunt of the credit crunch on developers, and assist the delivery of more affordable homes.
"Housing associations will be able to buy off the shelf stock from the private sector. It will help the hard pressed construction industry and increase much-needed affordable housing.
"This funding will kick-start site construction across Scotland, which I hope will herald a revival in the fortunes of Scotland's hard-pressed house-building industry."
John Cassie, Regional Chairman of Persimmon Homes, Scotland, commented:
"We welcome the Scottish Government's decision to help off-set the recent turbulence in the housing section by bringing forward funding for affordable housing from future years.
"We at Persimmon are delighted that our extensive knowledge of working with Housing Associations and the Scottish Government meant we were able to identify the appropriate mix of housing.
"The deal was concluded within only two months, thus ensuring we can build 24 new properties for Almond Housing Association by the end of 2009."
Frank Anderson, Executive councillor for services for the community on West Lothian Council, commented:
"We warmly welcome this additional investment in our area. It will provide much-needed affordable housing for local people.
"We would welcome the opportunity for further discussions about other possible funding as there is a continuing need for more affordable housing in West Lothian."
George Webster from the West Lothian Strategic Alliance, said:
"In these challenging times I believe this collaboration is a fine example of maximising opportunities in the present market conditions.
The agreement benefits all parties involved, and most importantly families who desperately need homes in West Lothian"
The funding will support projects across Scotland:
- £3.5 million will help accelerate site starts/construction on five projects in Highland, Stirling, Fife, West Lothian and South Ayrshire
- £4.1 million to fund land purchase by housing associations for future developments in Orkney, Perth & Kinross, Falkirk, East & West Dunbartonshire, and Argyll
- £1.4 million to fund purchase of suitable unsold stock from the private sector in Falkirk and Perth & Kinross
The 1.5 billion pound Affordable Housing Investment Programme is allocated mainly to RSLs (Registered Social Landlords).
Approximately 70 per cent of the programme is spent on helping RSLs to meet demand for new social housing for rent, on average subsidising about 60 per cent of development costs of each new house.
The West Lothian Strategic Alliance consists is a group of four Registered Social Landlords in West Lothian - Almond HA, Horizon HA, Weslo Housing Management and the West Lothian Housing Partnership - appointed by West Lothian Council to act as Development partners in building some 600 affordable homes in West Lothian.