By Chris Smith, 24housing editor.
Investment or bribe?
In fact, £1bn of EU investment is a lifeline we cannot refuse.
Bill Clinton famously won the presidency on a simple campaign slogan: “It’s the economy, stupid”.
The announcement by the European Investment Bank of a £1bn loan to build social housing is a lifeline for a sector facing severe financial constraints.
In the housing sector, access to finance is the critical issue which has to be solved if we are to build thousands of new homes.
David Orr, chief executive of the National Housing Federation has long warned that there are not enough lending mechanisms to lever in the funding needed by the sector.
This announcement will go some way towards changing that as it will add to the social housing sector’s proposition to global banks and pension funds. It’s a massive vote of confidence that will attract further private funding and increase innovation.
There has been a shortage of initiatives – the local authority bond scheme has yet to get off the ground and a lot of uncertainty has been generated by the Right to Buy legislation.
But this will further complicate the status of housing associations which have been added to the UK borrowing figures.
The Leave campaign is quick the call the loan as “cosmetic”.
They will have to do better as, bluntly, £1bn is not small change.
The exiters will have to make clear exactly how a Britain outside the EU would fund investment for thousands of new homes. We have been very short on detail and long on rhetoric.
We have a long-term housing crisis that won’t be solved by hoping something will turn up.