October 8, 2018 8.54 am This story is over 65 months old

Council leader calls for caution on home borrowing

Councils ‘should approach borrowing with caution’

The leader of North East Lincolnshire Council has called for caution on plans to let councils borrow more to build homes.

Councillor Ray Oxby said that more detail is needed before the authority can “commit” itself to further developments in the area.

It comes as Prime Minister Theresa May announced that local governments would be able to borrow more to build homes in her speech before the Conservative Party conference.

Mrs May said the government would scrap the cap on the amount local authorities can borrow against their housing revenue account.

“Solving the housing crisis is the biggest domestic policy challenge of our generation,” she said.

“It doesn’t make sense to stop councils from playing their part in solving it.”

Prime Minister Theresa May said the plan would help council’s to build more homes.

It is understood the change could potentially lead to an extra £1 billion borrowing and tens of thousands of new homes.

But, Councillor Oxby said that council finances are stretched and that any plan for further borrowing would need to be considered “carefully”.

“Although this does look like good news for councils, we must wait for the detail before we can commit to further developments in our area,” he said.

“Council finances are stretched and we will need to consider the proposals carefully to make sure we do the best we can for our residents.

“In recent years we have been working very closely with housing associations and the private sector to build homes for the future. We hope to continue this work going forward.”

South Kesteven District Council leader Matthew Lee.

Meanwhile, the leader of South Kesteven District Council said he was “delighted” with the plan.

Councillor Matthew Lee added that it was an “inevitable” policy for the government to unveil, but that the authority was still committed to building more affordable homes.

Elsewhere, City of Lincoln Council leader councillor Ric Metcalfe said the announcement was ‘long overdue, but welcome nonetheless’.

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