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Carmichael hits back over housing debt

MP Alistair Carmichael "disappointed" by comments from some councillors.

NORTHERN Isles MP Alistair Carmichael has insisted he is doing all he can to persuade the UK Treasury to write off a share of Shetland Island Council’s historic housing debt.

Carmichael said he was “disappointed” by comments from some councillors earlier this week as the SIC’s executive committee reluctantly backed plans to raise council house rents by five per cent in each of the next two years.

At Monday’s committee meeting, councillor Michael Stout said he felt as if the Tory-Lib Dem coalition was “standing with its arms folded doing damn-all” to help alleviate the £40 million millstone around the local authority’s neck.

Carmichael, who was recently appointed secretary of state for Scotland, said he was “doing everything I can to deliver what [the council] have asked”.

He had explained the situation behind the scenes to political leader Gary Robinson and chief executive Mark Boden, but could not talk publicly about it at present.

“They have heard from me and other people in the government that there is a willingness to assist if they can identify the means of doing it,” Carmichael said.

“To hear some of the comments in the earlier part of the week was a little disappointing, and it appeared to me that they [backbench councillors] were not interested in this information that I have passed on.”

He is optimistic there will be a positive announcement “fairly soon” – but would not be drawn on whether it would be contained in Thursday morning’s autumn statement from chancellor George Osborne.

Carmichael said he wasn’t about to “go out breaching my own duties in government and as a member of parliament to accommodate a timetable set by Shetland Islands Council”.

He added: “I don’t actually think it’s in their interests, and I don’t think it is reasonable, that they should be demanding it.”

SIC councillors have committed to writing off £10 million of the debt from the local authority’s oil reserves to help pay for the debt.

Earlier this year it tabled a proposal that would see Westminster and Holyrood cough up a similar figure to reduce the debt, which was incurred building houses to cope with the influx of oil workers in the 1970s.

Carmichael said he did not understand why councillors were pointing the finger of blame squarely at Westminster when “as far as I can see, the Scottish Government have done absoslutely nothing so far”.

An SIC delegation at Downing Street a year ago to plead with Westminster to take action on the housing debt.

He said the current situation had been created by Holyrood’s decision to cease paying a housing support grant to the SIC “which, incidentally, they still get from Westminster – but for some reason that doesn’t seem to attract criticism”.

Scottish government officials have privately indicated a willingness to contribute, though its assistance could take the form of money to build new homes rather than an upfront cash payment.

Robinson said on Monday that, with preparations for the SIC’s 2014/15 budget advancing, things were “really running up to the wire” regarding the housing debt.

“We have done everything we can over the past year to try to resolve this situation,” he said. “However, without confirmation that the UK government is willing to play its part, we’ve had to make sure we put forward an affordable solution for tenants.”