Post by dirth on Jul 4, 2014 18:52:03 GMT
Agree with the article, and comment on the sections below
"Most public sector housing in Scotland was built by councils and funded by loans secured from the Public Works Loan Board. Such loans came at low interest rates and were repaid by councils over an extended period - often as long as 60 years - representing good value for money for the public purse." If the councils used the income from sales to settle these liabilities early,they would not have the debt service charges incurred
"This long-standing method of funding and providing much-needed, low-cost homes to rent in the public sector was comprehensively undermined by the introduction of Right to Buy legislation, and further by the subsequent switch to the Tory/New Labour method of funding capital projects, initially called the Private Finance Initiative and latterly Public Private Partnerships" Unfortunately the idiots in charge of finance had absolutely no concept of well, finance .the system was discredited well before UK councils latched on , securing money at what would be colossal rates of interest over far too long a term
"When Right to Buy was introduced in 1980, councils were forced to sell property at discounted prices, despite the fact local authorities would have to continue servicing the long-term loans taken out to build the houses." That essentially shouldn't have happened as each was sold the money raised by the sale should have cleared the debt on that property , much like any other mortgage,if you like because that was what it was all be it in a larger scale, they mis-managed the finances
" In addition, under Right to Buy, councils were prevented from using receipts from the sale of houses to build replacement properties to rent. The consequence of the Tory policy is that the public sector in Scotland has lost almost 500,000 homes that previously would have been available to rent in local communities. This is why young couples now languish for years on council lists, waiting to be allocated an affordable home to rent." That I was unaware of,however with a little thought and I've spent about 5 minutes on how to circumvent that issue. It's probably fair to say in that period Labour controlled most Scottish Councils and treated the income as "bonuses" to be frittered away
Not very clever at all
"Most public sector housing in Scotland was built by councils and funded by loans secured from the Public Works Loan Board. Such loans came at low interest rates and were repaid by councils over an extended period - often as long as 60 years - representing good value for money for the public purse." If the councils used the income from sales to settle these liabilities early,they would not have the debt service charges incurred
"This long-standing method of funding and providing much-needed, low-cost homes to rent in the public sector was comprehensively undermined by the introduction of Right to Buy legislation, and further by the subsequent switch to the Tory/New Labour method of funding capital projects, initially called the Private Finance Initiative and latterly Public Private Partnerships" Unfortunately the idiots in charge of finance had absolutely no concept of well, finance .the system was discredited well before UK councils latched on , securing money at what would be colossal rates of interest over far too long a term
"When Right to Buy was introduced in 1980, councils were forced to sell property at discounted prices, despite the fact local authorities would have to continue servicing the long-term loans taken out to build the houses." That essentially shouldn't have happened as each was sold the money raised by the sale should have cleared the debt on that property , much like any other mortgage,if you like because that was what it was all be it in a larger scale, they mis-managed the finances
" In addition, under Right to Buy, councils were prevented from using receipts from the sale of houses to build replacement properties to rent. The consequence of the Tory policy is that the public sector in Scotland has lost almost 500,000 homes that previously would have been available to rent in local communities. This is why young couples now languish for years on council lists, waiting to be allocated an affordable home to rent." That I was unaware of,however with a little thought and I've spent about 5 minutes on how to circumvent that issue. It's probably fair to say in that period Labour controlled most Scottish Councils and treated the income as "bonuses" to be frittered away
Not very clever at all