The Scottish Building Federation has welcomed the Scottish Parliament's Rural Affairs and Environment Committee report on rural housing finding that many more affordable houses need to be built in rural parts of Scotland.

But it has warned that Scottish Government proposals to overhaul the system for allocating public funding for affordable housing will exacerbate the current problems.

In a recent consultation, the Scottish Government proposed to reorganise prospectuses for the allocation of affordable housing investment in Scotland around five large regions, with the Cities of Edinburgh and Glasgow retaining their responsibility for awarding subsidy within their own areas and investment decisions for Orkney, Shetland and the Western Isles also each remaining separate.

The Federation is concerned that the five regions proposed are far too large to be workable - and that, combined with the proposed system of appointing Lead Developers, the new system risks freezing out smaller construction companies who have considerable local knowledge and expertise.

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Responding to yesterday's Rural Affairs and Environment Committee report, SBF Chief Executive Michael Levack said: "I fully support this report's recommendation that a shortage of housing - and particularly affordable housing - is hampering the development of many rural areas within Scotland.

"I also agree that more could be done to overhaul the planning culture and alleviate pressures on rural housing provision. However, I also think it's important to understand the vital role that smaller construction firms play in delivering more affordable housing in Scotland's rural areas - and the need to ensure that they can continue to fulfil this role in the future."

He spoike of the SBF's concerned over the Scottish Government's recent proposal to re-organise the system for allocating public funding for affordable housing around 5 large regions - and the negative impact this will have on rural housebuilding.

"Our main fear is that the new system will naturally discriminate against smaller local construction companies who have built up a lot of valuable local knowledge and an ability to understand and cater to the specific housing needs of those more rural communities, where the shortage of affordable housing is particularly acute," he continued

"I therefore support the committee's focus on the need for more rural housing. But I hope also that they will resist the Scottish Government's plans to reform funding for affordable housing in a way which will actually make the problem worse not better."

(GK/JM)