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Chancellor urged to give councils freedom to build more homes
GOVERNMENT restrictions on what local authorities can spend on housing are hampering efforts to tackle homelessness in a North-East town, a report has claimed.
Darlington Borough Council has been named as one of nine councils in the country that have been unable to borrow a single penny for social housing in recent years, as a result of Government caps.
The Local Government Association (LGA), which represents councils in England and Wales, is urging Chancellor George Osborne to use Thursday’s (December 5) Autumn Statement to lift the restrictions.
This would allow councils to invest in housing under normal responsible borrowing guidelines.
The LGA found that 2,068 people in Darlington are on a waiting list for a council house.
Darlington council leader Bill Dixon said the amount local authorities borrow to invest in housing should be calculated by multiplying rental income over a period of time.
He said: “If we say we were getting £1million coming in in rent, take that over 30 years, you soon see how much we might be able to borrow if the cap was removed.
“That would enable us to make a huge dent in the housing need in the borough.”
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.
"The Chancellor has an opportunity to use this Autumn Statement to create jobs, provide tens of thousands of homes and help the economy without having to find a single extra penny.
"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.
"Councils could build up to 60,000 additional new homes over the next five years if the Treasury removed the housing borrowing cap and allowed councils to invest against normal borrowing guidelines."
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