Details of the extra money – which will clear the way for transfer to take place by February 2003 – emerged this week as Glasgow Housing Association unveiled its long-awaited funding arrangements.
They will bring in up to £850m in loans from four lenders led by the Royal Bank of Scotland and the Bank of Scotland.
Sandra White, Scottish National Party MSP for Glasgow, said: "This is a case of public money being poured down a black hole. Why is so much money being thrown at Glasgow Housing Association?
"No explanation has been offered and there is no guarantee that it will be a success."
The £100m of extra money was described as a contingency fund to be drawn on only if required and is earmarked for building homes.
It will be available to Glasgow Housing Association for 10 years after it takes over Glasgow council's 82,000 homes.
The news is the latest controversy to hit the transfer, which has been dogged by legal challenges and uncertainty over the final transfer date since the successful ballot in April this year.
Opponents of the stock transfer have vowed to keep fighting, and as Housing Today went to press one group was understood to be seeking an interim interdictment followed by a judicial review.
According to the Scottish Executive, the money comes from savings in Communities Scotland's Glasgow investment programme, which should allow houses to be built and repaired using less money than previously predicted.
However, with total public subsidy for the transfer now running at more than £1.6bn, others believe the setting aside of additional funds ignores wider public interests.
Nick Fletcher, policy officer at the Chartered Institute of Housing, said that although the extra money is being passed off as savings from elsewhere, it could be better spent on building up to 4000 homes in Glasgow.
He added: "It's a shame that the figures haven't stacked up.
But the money to support stock transfer should have come from elsewhere, rather than from funds for new houses.
"It's a short-sighted move."
Glasgow council's most senior policy body – the policy and resources committee – is due to meet on December 20 to consider the GHA's final transfer plan.
If passed, as expected, the plans will then go to Scotland's First Minister, Jack McConnell, for final approval.
Glasgow’s troubled transfer
July 2001 proposals for £4bn investment in city’s council housing published by potential new landlord Glasgow Housing Association; housing to be owned by GHA but managed by local housing organisations September 2001Scottish first minister Henry McLeish confirms that Glasgow’s £900m housing debt will be paid off if transfer goes ahead January 2002
transfer ballot set for early March 2002 April 2002
ballot result: nearly 60% of tenants who vote support transfer; council indicates transfer should happen within eight months July 2002
local housing organisations given more time to prepare for transfer after tenants complain. Tommy Sheridan MSP leads calls to have the funding arrangements for the transfer ruled invalid under European law September 2002
rumours circulate about a £100m funding gap in the transfer plans; anti-transfer campaigners prepare legal challenge November 2002
council misses self-imposed November transfer deadline December 2002 news of £100m contingency fund breaks as the council considers final transfer plans
Source
Housing Today
No comments yet