It’s probably a telling data point that I, and quite a few other people, thought Faisal Islam was being sarcastic about this story and the councillor had somehow finagled the money. Perhaps he got the council to buy the property from himself? Emerging low trust society, h’ware ya.
obviously I meant Stevenage Council bought 20 houses using borrowed money, with interest serviced by rents.. pic.twitter.com/S5NIkuMf40
— Faisal Islam (@faisalislam) September 24, 2013
But apparently not. Stevenage borrowed from the Public Works Loan Board (i.e. the Bundespicklesministerium) and bought up a bunch of houses, which they’re going to rent and use the (LHA-funded) rents to pay down the loan from central government. The annoying thing is that PWLB funding is relatively dear, and is contingent on approval from people like Eric Pickles and George Osborne. But it’s a start on the Simple Plan.
If this is the transaction, they got 2.37% from government over 9 years, 6 months, but there’s a further twist because of the process of transition from handing all housing revenue to central government to keeping it in-house. This apparently involves councils taking out loans from the PWLB (presumably to reflect the central government contribution in the past?).