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10
Aug
Housing company using council 'like bank of mum and dad', say Greens
The Green Party has criticised North Yorkshire Council for making “huge loans and subsidies” to its own housing company “behind closed doors”.
Brierley Homes, which was founded in 2017 and oversees housing developments across the county including in the Harrogate district, was granted a £1.4 million loan last month.
The funding was approved after a council report said the company required “additional loan headroom” to assist with cashflow while it delivered affordable housing and to "allow the company time for sales to be received”.
But the Green group on the council has questioned why authority officials are continuing to “prop up” the company, which they say is using the council like “the bank of mum and dad”.
Cllr Arnold Warneken, who represents Ouseburn division, said:
I’m deeply concerned that officers have been making these huge loans and subsidies to a private company behind closed doors. If they want public funding, there must be public scrutiny. If they were investing in council housing, that would be a different matter, because it’s an investment in Yorkshire people and their wellbeing.
The move comes as the council approved an extension to a maximum loan facility for the company to £25 million in April.
The loan facility was first introduced in March 2018 as a means of funding the firm to construct and sell homes.
In February 2020, the company exercised its ability to draw upon the loan facility and was approved £22.9 million to construct and sell homes.
Five years later, the council has made a decision to extend the facility to £25 million.
In a report, Vicki Dixon, assistant director of resources at the authority, said the new loan was “not envisaged” when the maximum loan facility was agreed in April.
Ms Dixon added that the loan was “proportionate and necessary” to the company’s affordable housing programme as it was delivering a number of homes above the policy requirement.
However, Cllr Kevin Foster, leader of the Green group on North Yorkshire Council, said he questioned how the council could justify further money for the company.
He said:
We have a housing crisis and what we need most is council houses. How can we justify this kind of money when Brierley Homes does not contribute to the council’s target of 500 council houses?
Affordable housing still isn’t affordable to many - I have families coming to me every week saying they can’t find suitable housing they can afford.
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