04.12.13
Councils’ ‘hands are tied by borrowing block’
The LGA has repeated its call for restrictions on council borrowing to be scrapped, allowing local authorities to leverage more money to spend on housebuilding.
The amount councils can borrow against is currently capped at different levels depending on the area.
Mike Jones, chairman of the LGA's environment and housing board, said: “There are millions of people on social housing waiting lists and councils want to get on with the job of building the new homes that people in their areas desperately need.
“Local authorities have excellent credit ratings and we want to use our assets to help kick-start the housing recovery, but our hands are being tied.
“New homes are badly needed and councils want to get on with building them. The common sense answer is for the Treasury to remove its house building block and let us get on with it.”
But housing minister Kris Hopkins warned that “there is no magic money tree”. He added: “Under this government, the housing market has turned the corner, with house building now at its highest level since 2007, backed by up £19.5bn of public and private investment in affordable housing over the current spending review.”
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