The Conservative shadow housing secretary says the investment is not new, and “a drop in the ocean” compared to cuts made to affordable housing in Scotland
The Scottish government will provide funding to issue £22m in bonds to Link Housing and Cairn Housing Association to support the delivery of 150 affordable homes.
Link’s bond value is £16m and Cairn Housing Association’s bond value is £6m.
The funding for these two new bonds was included in the published 24/25 Scottish Government budget, but the announcement that the loans will be given to Edinburgh-based Link Housing and Cairn Housing Association in Dundee was confirmed yesterday.
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Miles Briggs, Scottish Conservative shadow housing secretary, referred to the housing minister’s funding announcement as “out-of-touch”.
He said: “Paul McLennan should be ashamed of his out-of-touch statement, which seems to be an embarrassing attempt from the SNP to congratulate themselves on their own failures.”
Briggs added: “The £22m of funding he mentioned is not new and is a drop in the ocean compared to the £200m that the SNP slashed from the housing budget.”
The funding will be provided as part of Scotland’s Charitable Bond programme, which has been running since 2014 and provides loans to social landlords to deliver new affordable homes.
The interest generated from the bonds is reinvested by the Scottish Government into the affordable housing budget to support more homes for social rent.
This latest extension will see the total number of bonds issued increased to 40 and a total investment of more than £482m.
The housing minister, Paul McLennan, said: “Tackling the housing emergency requires bold thinking and investment in charitable bonds is another tool we can use to increase investment in our affordable housing budget while also allowing social landlords to access vital funding to build new homes.”
He added that this funding model has been successful in the past, “but is reliant on financial transaction funding from the UK government”. Financial transaction funding, which McLennan noted is vital in housebuilding, has been cut by 62% since 2022.
McLennan continued: “While we are demonstrating what we can do with the devolved powers and levers we have, it is vital that the UK government reverses that cut so we can increase investment in the affordable housebuilding sector.
“We have a strong track record in affordable housing with 133,000 homes delivered since 2007, 93,000 of which are for social rent. However, tackling the housing emergency requires joint working from the Scottish and UK governments and local authorities.”
In February, the Scottish government passed its 2024/25 budget, which saw funding for affordable housing supply cut by £196m to £556m.
Last month, the first minister John Swinney said the government remains committed to investing nearly £600m in affordable housing, with £40m allocated for turning existing homes into affordable housing.
The government will also provide a further £100m to support the construction of around 2,800 mid-market rent homes.
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