The Highland Council is urging the UK and Scottish Governments to invest more on affordable housing in the Highlands.

Members of the Housing and Social Work Committee highlighted the need for persistent lobbying of Westminster and Holyrood for additional funding to allow more houses to be built and to cushion the impact of the "credit crunch" on the Highland economy.

The Council's case has been set out in a letter Convener Sandy Park has written to John Swinney, Cabinet Secretary for Finance and Sustainable Growth.

In his letter to Mr Swinney, the Convener said the impact of the "credit crunch" was having a significant impact on the local construction industry, which was consequently affecting the ability of the Council to deliver affordable housing in the Highlands.

The Council, he said, had been successful in delivering affordable housing working in strong partnership with the Scottish Government and local housing associations, using its enabling role to prioritise surplus Council land for affordable housing. It had set up a £10m land bank facility with the Scottish Government and implemented a strong affordable housing planning policy.

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Currently the Council's affordable housing policy had delivered 70% of new affordable housing in the Highlands. However, due to the credit crunch, developers had significantly reduced the building of new private housing, with the result that very little affordable housing was being built. In addition, most land was still in farming interests or with landowners with low debts therefore there was no incentive for landowners to sell for affordable housing land values.

Councillor Park added: "There is a real need to increase the level of public investment in housing in order to increase supply of affordable housing in housing stressed areas, keep the construction industry viable in Highlands and stimulate demand and confidence in housing market through low cost homeownership options. This would enable the Scottish Government, Council and housing associations to work together with developers and contractors to unlock sites currently shelved, to develop new affordable houses for rent and sale.

"Specifically, the Council would request that additional funding is made available to fund sites which are in housing association control and are currently being delayed due to the limited public finance available to housing associations, and sites which are in developers control which will are not proceeding because of the credit crunch."

The Council is planning to convene a "Highland Housing Conference" in October which will invite all stakeholders in the Housing agenda to work together to find new ways to tackle these challenges. Details will be announced soon.

(GK/JM)