Budget Reaction - Huge Challenge for Scotland’s Housing Associations

Responding to the Scottish Government Draft Budget... the SFHA said the cut to the affordable housing budget presented a huge challenge to housing associations and co-operatives.

The funding available for new housing supply will fall from £268.5 this year (2011-12) (1), to:

• £155.31m in 2012-13;
• £133.45m in 2013-14 and;
• £160.00m in 2014-15.

The overall Housing and Regeneration Budget will fall from £393.m this year to £276.4m in 2014-15, a huge cut of over £100m (2).

Dr Mary Taylor, CEO of the SFHA said:

"We welcome the announcement of a three-year budget; this means that our members know what resources might be available during the life of this parliament, rather than just one year ahead. This allows organisations to plan properly once they and we know the terms on which the funding can be used.

"However, the figures make disappointing reading. The affordable housing budget this year has already taken a cut of around 30 per cent, on a budget reduced from previous years. As a result we are witnessing a steep decline in the number of new homes supplied by our members, at a time when need is increasing.

"These deep cuts proposed for public funding for new affordable housing in Scotland amount to a further 50 per cent in the next two years alone. This leaves housing associations and co-operatives with a difficult challenge in developing much -needed new affordable homes for rent.

"These homes would represent an investment in our communities and provide a vital economic boost."

Dr Taylor added:

"We would also point out that the Scottish Government will face difficulty in meeting its own target of 30,000 affordable homes over the life of the parliament - despite changing rules to enable it to count homes started in previous years.

"We recognise that the Scottish Government is dealing with a significant cut to its own capital budget, and we will work together with the Scottish Government, local authorities and others to try and deliver the maximum number fo affordable rented homes."

"We also welcome further details on what funding arrangements will be made for fuel poverty, Wider Role (which helps housing associations carry out regeneration work) and home adaptations - which should be a vital part of the preventative spending ethos."

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For further information, contact Claire Munro on t: 0141 567 6224 m: 07771926778 or e:

Visit our website at www.sfha.co.uk

NOTES:

1) Detailed figures supplied by the Scottish Government.

2) The Scottish Draft Budget 2012-13 is available here http://www.scotland.gov.uk/Resource/Doc/358356/0121130.pdf

3) The SFHA was established in 1975 and has around 170 members providing affordable housing and wider community services in Scotland, as well as a further 200 commercial members. The SFHA is owned by its membership and exists to support the work of housing associations and co-operatives in Scotland by providing services, advice and good practice guidance.

4) The SFHA is the voice of the principal builders and managers of new affordable housing for rent in Scotland. Housing Associations own and manage around 40% of the country's affordable rented housing stock, over a quarter of a million homes across Scotland.

5) Housing associations and co-operatives are not-for-profit bodies regulated by the Scottish Housing Regulator.