Housing Debt Won’t Be Cancelled for High Council

According to recent word from the chief secretary to the Treasury, the government of the United Kingdom will not be able to write off £146 million in housing debt for Scotland’s Highland Council in the short term. As it turns out the MP for Iverness, Nairn, Badenoch and Straspey, Danny Alexander, is actually known for having campaigned to have that debt be written off in his earlier campaigns. While it does not surprise political observers that government officials would be caught reversing their positions once in office, it does come as a shock to the Highland Council that had high hopes for a solution to debt woes.

The visit by Alexander to the Scottish Parliament led him to make a statement that the importance of the overall financial situation in the UK trumped that of the Highland Council’s debt troubles for housing. Right now, Highland is having to spend £15 million per year on loan charges simply to keep the debt at bay. With the situation being so serious, debt at the consumer level is also getting tougher, so many Scottish citizens who also face tough times are entering into a Scottish trust deed to try to find their way back to financial freedom. A clear indication of what economists commonly refer to when they mention that the higher levels of government are often engaging in financial behaviours that are reflective of their citizenry – no matter which government one is referring to.

Highland maintains that if the debt were cancelled so that the burden were removed, it would be able to commit more money towards the goal of improved housing stock. Alexander has assured the Council that he can not offer any hope for the situation at this time. He claims that the UK must solve overall debt woes before helping out any specific part of the country.

The tenants of the local authority voted in 2006 to not transfer ownership of over 14,000 homes to a privatized housing association (the Highland Housing Association) by a vote of 60 per cent having the majority say against the plan. This went against the ministers and leaders of the Highland Council who had encouraged the tenants to support the transfer of ownership. That move would have yielded not only a clearing of £160 million in debt, but more than 1,000 new houses constructed.