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What’s going on in Scottish local authority housing finance?

This briefing paper assesses the implications of the long term trends identified in recent government statistics on Scottish local authority housing revenue account data.

Overall, local authority housing finance is strong and on a positive trajectory (though it may be plateauing) but there is considerable local variation. The authors conclude that:

  • Local variations are one reason why we need a serious investment in research into individual local authority Housing Revenue Account (HRA) business plans and their assumptions.
  • It appears under reasonable assumptions and standard summary measurement techniques, that considerable financial capacity exists in the sector to invest more in new homes and that this may be further increased if local authorities switched from pool rates to spot rates for borrowing.
  • There is an affordability trade-off for rent levels between individual councils funding strategies between borrowing or using surpluses – this is another reason why we need forensic research into HRA business plans to understand how these long term decisions are being made.

Authors: Tony Cain and Professor Ken Gibb


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Date: March 26, 2020 8:00 am

Author(s): and

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