SCOTTISH ministers have pledged to help Shetland Islands Council sit down with the Westminster government to resolve the long standing £40 million housing debt.
The SIC is also proposing to put up £10 million towards halving the debt, if Westminster matches the figure.
Under the proposal the Scottish government would grant fund the building of new social housing in the isles to help reduce the waiting list for affordable homes.
During the Scottish cabinet visit this week various ministers, including first minister Alex Salmond, promised pressure would be put on the chief secretary to the treasury Danny Alexander to honour his promise last December of a tripartite meeting.
SIC leader Gary Robinson said: “We need to get that level of engagement if we are ever going to get a solution to the problem.”
He said that the SIC’s proposal would give all three parties some credit.
“What we propose is that we would put in £10 million, we have already factored that into a medium term financial plan,” he explained.
“We would have that matched by Westminster so in effect £20 million would go towards writing off the debt and what we would seek from the Scottish government is a grant to build new houses, because that’s the real difficulty.”
It would also mean the council could avoid double figure council rent rises which tenants face if the debt issue is not resolved.
The proposal would leave Shetland with a £20 million housing debt, which was more in line with the level other local authorities carried.
Orkney, he said, had a housing debt in the “mid teens of millions”.
“We wouldn’t write the debt off, but I don’t think there is a local authority in Scotland that doesn’t have a housing debt or a debt on its housing revenue account.
“This would be a manageable amount of debt, and put us back in a position where we wouldn’t have to raise rents as high as we would have done otherwise and we would also be able to look forward to build some houses.”
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